Georgina Adam provides a rare and valuable glimpse into an art fund with some results from Gil Brandes of Artpartners who has made 30% on the sale of 5 works from his Artpartners fund which invested $9m with a 5yr horizon. (Adam doesn’t make it clear whether the 30% return is based upon the $9m total or the purchase price of the five works sold.)

“We did well on two [Haruki] Murakamis, [Rudolf] Stingel, [John] Chamberlain and in a small way on Cindy Sherman,” says Brandes: “And we are hoping to do well on a [Donald] Judd. But we have taken hits on a Jonathan Meese sculpture, a Jack Pierson, a Franz West and Anselm Reyle.” The worst case, not surprisingly, was a large Damien Hirst butterfly piece that the fund bought for $1.5m, now being resold for just $1m.

Artpartners is raising a second fund that will invest $25m over 10 years according to Adam.

The Art Market: Top of the Charts (Financial Times)

“Investible Art Market” Is 3k Pictures Sold Yearly; We Buy 100

Philip Hoffman claims Qatar are buying $2.5bn in art each year which accounts for a quarter of the $10bn investible art market, according to his calculations. He sees Abu Dhabi and soon, Saudi Arabia, close behind with this buying setting up a 10-year art boom:

Click on the image to see the CNBC WEX clip.

The muted Impressionist & Modern sales in New York raise the real possibility that investment-grade sector of the art market has lost some of its demand. When you think about it, there’s a certain macro-sense to all of this. During the height of the deflationary moment from 2009-2011, many business owners were still generating a great deal of cash and saw no place in the financial universe to store it.

Prominent investors were extolling the value of art as a strong-box. But as the worst of Euro crisis has subsided (for now) and corporate earnings seem stalled, there may simply be less demand for storing value in art; therefore, there’s less demand for blue chip Picassos & Monets.

Then, again, Bloomberg announces the launch of another art fund. This one heavily skewed toward the asset management side of the business instead of being driven by a strong art thesis:

“Tangible assets remain firmly in investors’ focus,” Raymund Scheffler, the manager of Berenberg Art Advice and head of the bank’s Dusseldorf branch, said in an e-mailed release. “Because their value moves independently of classic investments like shares, bonds or even real estate, an art investment can complete every well-structured portfolio.”

The bank will cooperate with museums and collectors to identify top-quality artworks, according to the bank’s statement. The Fine Art Fund Group, an art investment company established in London by Philip Hoffman in 2001, will advise it on acquisitions.

Beckham Speedboat Sale; Chinese Auctions Shrink: Art Buzz (Bloomberg)

Everyon, including The Guardian, has the story of the soon-to-be-authenticated Turner:

Experts will present evidence next week claiming to have uncovered a long-lost painting by JMW Turner, bought for £3,700 but now valued by one insurance firm at £20m.

Jonathan Weal, 54, who works for an art investment fund, spotted the seascape eight years ago in an auction at a Kent golf club.

After years of research, his belief in the work – entitled Fishing Boats in a Stiff Breeze – has apparently been backed by art experts and by scientific tests that investigated everything from pigments to the signature.

Missing Turner Painting to be Unveiled (The Guardian)

The Kansas City Star spends some time with Sandy Kemper and learns more about his plans for a new investment vehicle to launch this fall. The fund’s American Masters Collection has an interesting definition of American art:

Kemper launched the Collectors Fund in 2007. Its first investment vehicle, the American Masters Collection I fund, deals in 20th century American art pieces costing less than $500,000. Artists represented in the collection include Marsden Hartley, Thomas Hart Benton, Robert Motherwell and photographer Cindy Sherman. Among paintings sold in 2010 are works by Helen Frankenthaler and Franz Kline. To join the fund, an investor originally had to put up at least $100,000. Because of the gains it made, the minimum was raised to $135,000. It was closed to new investors in December. The fund is now valued at $20 million. [...]

The fund distributes 40 percent of the profits made from each sale to its members and uses the rest to buy more art. Kemper said the fund’s internal rate of return, a way to measure the growth of investments over time, has averaged 28.5 percent annually. The fund will liquidate around 2017, the exact date depending on market conditions, and distribute its assets to the shareholders. Kemper said that although most members invested in the Collectors Fund for financial reasons, it provided a few unique perks: visits to artists’ studios, behind-the-scenes tours of auction houses and opportunities for members to display the art in their homes.

“It’s financial. It’s aesthetic. It’s social,” Kemper said. “Having appreciation for art and doing well financially are not opposing forces.” This fall the Collectors Fund will launch its second venture, the American Masters Collection II. It will invest in pieces starting at $500,000.

Kemper-Led Collector’s Fund Banks on Art, Not Stocks (Kansas City Star)

There’s been lots of talk this past year about art funds but one under-appreciated aspect of the idea is that many other institutions are already operating as de facto art funds. Take the example of Australia’s Artbank which is described in this Sydney Morning Herald profile of its director, Geoffrey Cassidy:

”We’re about supporting living artists,” says Cassidy, 51, who spends about $1 million each year on works from emerging and mid-career artists. ”We want to spread the love.” Artbank was set up by the federal government in 1980 to support young Australian artists by buying their work and then renting the pieces out to companies, government offices, embassies and private art lovers. It now owns more than 10,000 works by 3000 artists, making it the biggest collection of Australian contemporary art, valued at more than $35 million.

Profile: Geoffrey Cassidy (Sydney Morning Herald)