(Bloomberg) — Some of Australia and New Zealand’s biggest financial institutions are selling down their vast art collections after decades of holding pieces by some of the region’s best-known painters.
In the next few days, the Melbourne-based Construction and Building Unions Superannuation Fund is auctioning the last of about 300 pieces, which included works from noted Australian artists Arthur Boyd, Emily Kngwarreye, Margaret Preston and Brett Whiteley. The final tranche to go on sale features about two dozen Indigenous artists.
The pension fund purchased the pieces over several years three decades ago for about A$2 million ($1.2 million) and has made what looks like a tidy profit — A$11 million haul raised so far. Yet for the institution, which handles A$70 billion in pension investments on behalf of 850,000 members, the gain is barely a rounding error on a slow day.
The sale comes as Australian pension funds face heightened scrutiny of their balance sheets. Last year, new rules required funds to file detailed reports on their holdings every six months across a range of asset classes and derivatives. In contrast, the world’s largest banks and institutions are still buying art, acting as patrons and being described as the new Medicis, the Florentine banking family that famously supported Renaissance artists.
The union pension fund, known as Cbus, declined requests for interviews. “To get the best outcomes for our members we are now offering the collection for sale,” Cbus deputy chief investment officer Brett Chatfield previously said to Australian publication Money Mag.
The original goal of the superannuation fund’s collection was to bolster the community at the same time as making a tidy profit, and the works had been hung in regional galleries, Melbourne artist and collector Norman Rosenblatt said.
“Every company — everybody — should have an artistic conscience in this country,” said Rosenblatt, whose uncle bought for the Cbus collection starting in the late 1980s. “We’ve lost our corporate soul in helping the arts — we’ve just lost it.”
The auctions have been successful, with record prices for paintings that exceeded estimates, during a banner time for art valuations. The global art market recovered strongly in 2021 after a dip in 2020, according to an Art Basel and UBS report. Aggregate sales of art and antiques by dealers and auction houses reached an estimated $65.1 billion, surpassing the pre-pandemic levels of 2019, the report said.
The auction of the remaining 26 Indigenous artworks ends Tuesday, with works from artists including Johnny W. Tjupurrula, Timmy Payungka Tjapangati and Pansy Napangardi. The sale is expected to total between A$120,000 and $160,000, said Damian Hackett, director of auction house Deutscher and Hackett.
Cbus is the latest regional institution to auction off artworks. A few months ago, one of Australia’s largest banks, NAB, sold the majority of its collection and redirected the funds to philanthropy. “While the art is appreciated, it is clearly not core to NAB’s role as a bank and supporting customers,” the bank said in a statement.
Earlier this year, former New Zealand Prime Minister Helen Clark criticized the Bank of New Zealand for offloading its collection of 200 pieces.
Clark said the bank shouldn’t have sold work acquired while it was a state-owned company, before it was privatized.
“These are very significant New Zealand works of art which were acquired by a state company,” she told Radio New Zealand. She called for the Ministry of Culture and Heritage to intervene.
The bank said it had consulted over a “two-year period” on the future of the collection, and funds from the sale would be put towards its philanthropic foundation. “BNZ has retained a curated collection of works that are of particular significance to the bank, and these will continue to be displayed within our shared spaces and available on loan for public exhibitions,” a spokesman told Bloomberg.
Rosenblatt lives in the affluent Melbourne suburb of Brighton. His expansive personal art collection adorns the walls of his home of 35 years, and he has a glossy, hardcover catalog of the Cbus collection. It is a heavy tome of hundreds of pages, documenting each artwork in great detail.
Rosenblatt said that while his uncle was tasked with building a collection that would make a return over time, he also strongly believed the works should benefit the community. “It’s petty cash to this company,” he said.
Philip Hoffman, founder and chief executive officer of The Fine Art Group, based in London, said rising demand for fine art would be fueling decisions to sell now.
“Despite Covid and all the talk of the downside, the very wealthy made a huge amount of money, maybe doubled their wealth, and they’ve been plowing their money into alternative assets,” Hoffman said. He said hundreds of families are looking to spend anywhere between $1 million and $3 billion in art.
The BNZ collection — which included works by artists Colin McCahon, Rita Angus, Gordon Walters, Toss Woollaston, Gretchen Albrecht, Milan Mrkusich, Don Binney and Ralph Hotere — was estimated to go for NZ$10 million but shook out at NZ$15 million — “far more than any other auction” in New Zealand, said Charles Ninow, the director of Webb’s Auction House, which handled the sale.
“The market is going through something that’s quite amazing,” Ninow said.
Part of Rosenblatt’s own extensive personal collection is currently on display at a suburban gallery in Melbourne. He has seen how the arts industry has suffered through the pandemic, and he wants corporations to think about how they can give more back to the arts community.
He wished Cbus would consider giving some of the money from the sale back to the arts community.
“I personally think it’s been handled, artistically, very callously,” he said.
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