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(Last updated: 16 Sep 2011)
Trends and opportunities
The market
Germany has traditionally been one of the world's most respected art centres, and Berlin, with about 400 galleries, has since become the country's most important art market. Thirty-five new galleries, most of them branches of foreign galleries in London, Amsterdam and New York, have opened their doors in the German capital since 2004. Since the financial crisis in September 2008, gallery owners seem to be playing it safe again and they are once again opting to showcase their work at various art fairs such as Art Cologne.
The financial crisis did not spare the art market. While hardly any galleries closed in Germany, most of them experienced a downturn in revenue. Gerrit Friese, chairman of Germany's Federal Association of Galleries, is convinced that the effects of the financial crisis are much worse than is commonly believed. "There are clear developments which show that revenues dropped around 20 to 25 per cent between 2007 and 2009," he said during the opening of Art Cologne in 2010.
In the few years prior to 2008, the market had filled with speculators. Rather than buying art for its quality or to fulfil a personal passion for collecting, they chose works based on artists’ names. In 2006, two years before the onset of the financial crisis, the art market had a turnover of nearly €1.3 billion. By the end of 2009, the German art market had grown to €1.84 billion, an increase of 41.5 per cent.
The three major sales channels: ‘own-account artists’, retail sale, and museum shops/art exhibitions accounted for 48.8 per cent, 26.75 per cent and 24.5 per cent respectively. In terms of employment, the German art market boasted a total of 12,250 companies employing a total staff of 16,570 in 2009. The overwhelming majority of them (over 10,700) were individual artists, not connected to any company or auction house.
Collecting and dealing
The German art market enjoys a significant advantage because of the country’s federalist system. Germany hosts many art centres that help enhance regional diversity. Artists’ houses support professional artists of all disciplines by providing them with studio space and accommodation for limited periods of time, often combined with the award of a stipend or grant. They are international meeting places and centres of cultural and creative exchange. Whereas a centralised art market allows a single leading institution to control trade, in Germany the diverse collection of museums with varying structures and styles express their influence and ideas. In terms of sheer number of galleries, art fairs and public art institutions Germany follows a close second behind the US. Measured by capita, Germany actually contains the most art institutions in the world.
Publications such as ART – Das Kunstmagazin, Artinvestor and Artnet provide interested readers with frequent updates about recent auctions, art fairs and exhibitions.
Most art galleries remain concentrated in the centres of German art dealing, ie. Munich, Berlin, Cologne and Dusseldorf. Auction houses are more widely dispersed and numerous. These houses organise several sales, mostly in spring and autumn. The most prestigious works appear for sale at the most famous galleries: Kunsthaus Lempertz in Cologne, Villa Grisebach in Berlin, Ketterer Kunst in Munich and Hauswedell & Nolte in Hamburg. Unlike other countries, no single location maintains a monopoly over the market. This highly regionalised structure produces lively competition among German auction houses. Christie’s have a location in Dusseldorf and Sotheby’s are present in Hamburg.
Germany has two particular galleries selling Australian aboriginal art:
Art Gallery Bähr in Speyer
The gallery exhibits and sells paintings from more than 70 artists from Australia and is specialised in contemporary art works of museum quality by renowned Australian Aboriginal artists. Gallery Bähr is also active in the organisation of exhibitions throughout Germany.
Brit's Art & Promotion in Übach-Palenberg
Brit-Susann Hanstein has been working for 15 years in the field of Australian indigenous art. The gallery is one of the first international aboriginal art galleries which signed the Indigenous Australian Art Commercial Code of Conduct.
Major trade shows
Preview Berlin – The emerging art fair, Berlin, Germany
Cologne Fine Art and Antiques – International fair, Cologne, Germany
Kunst 11 Zürich – International Art Fair, Zuerich, Switzerland
Art Karlsruhe – International fair, Karlsruhe, Germany
Art Cologne – International fair, Cologne, Germany
Art 43 Basel – International fair, Basel, Switzerland
ART Bodensee – Dornbirn, Austria
Opportunities
During the past decade, some trends emerged:
- The structure of markets changed due to the evolution of the Internet and the acceleration of online sales
- Competition grew due to increased numbers of art fairs (over 260 around the world)
- Investors and investment funds grew in importance as prices for pieces of art increased considerably
- ‘Art exchange’ became more popular, particularly as public museums could not afford to purchase pieces of art any longer
These developments had some consequences:
- Due to the growing wealth in the Chinese market, for the first time China overtook the US and the UK in 2010 as the world’s largest auction marketplace for fine art with a market share of 33 per cent. The US now ranks second with 29.9 per cent, the UK third with 19.4 per cent. France is on the decline with a decreasing share of 5.1 per cent while Germany is ranked fifth. With an international market share of only 1.9 per cent the German market is comparatively small and is likely to remain so in the future.
- The trends indicate that new players in terms of countries and distribution channels have a major influence on sales. The art market will become a global market dominated by investors and investment funds. Smaller niche markets can be of interest to Australian art.
Competitive environment
Even though things are improving, Germany lags behind other countries when it comes to the art trade. Big business is usually done in London or New York. The auction houses in New York traditionally make as much in sales during an auction week as they do in a year in Germany.
A recent study conducted by artprice.com showed that since last year, China has had the highest volume of sales, followed by New York and London. This strong regionalisation trend is having a negative impact on the German art trade. Unlike in the US, Great Britain and France, Germany does not have a set address where the art scene can convene. Instead, it has many centres, including Hamburg, Cologne, Berlin, Frankfurt, Dresden and Munich.
However, many art collectors believe that this variety gives the German art business a distinguishing feature. Germany has a thousand professional galleries which is very unusual on the international stage.
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