With an art market that takes up roughly one-fourth of global art sales, a growing population of over 1 million millionaires, and the second-largest increase in luxury hard asset investment in the world, China has a group of collectors showing a strong and rising interest in buying art for investment purposes. That’s not the only thing for which they have growing demand, however: the fast and furious market boom in recent years has also led to the desire for both business and art expertise, and Sotheby’s Institute of Art is jumping in to fill the gap.
On March 12, Sotheby’s Institute marked its official expansion into mainland China when it announced its new partnership with Beijing’s Tsinghua University to create two new art and business education programs. This decision comes at a time when the Chinese art auction market is poised for massive expansion. Chinese art has been regularly setting records at recent auctions: earlier this month, a Zhang Xiaogang piece sold for the artist’s record at Sotheby’s Hong Kong, netting $12.1 million. This follows Sotheby’s $23.3 million sale last October of Zeng Fanzhi’s The Last Supper, the most expensive piece of Chinese contemporary art ever sold at auction. The market has ample room to grow: prices of top blue-chip Western contemporary art show that global collectors are now willing to pay upwards of $140 million for a single piece, as exhibited by the record-setting sale of Francis Bacon’s Three Studies of Lucian Freud last fall.
Sotheby’s Institute clearly believes in this enormous growth potential. The Institute chose Beijing to accompany only three additional campuses worldwide in global art centers London, New York, and Los Angeles. That choice was not just a coincidence, according to Sotheby’s Institute CEO Michael Chung and President David C. Levy. “There is clearly a tremendous amount of growing interest in all of the art areas in China,” said Levy when asked about the reasons for starting the program. According to Chung, the Chinese art market is quickly gaining ground on markets in the United States and Europe as it rapidly expands. “I think it’s going to eclipse those markets by a big margin” in the next 10 to 20 years, he said. “Our strategy was to put our flag in a market that has those characteristics, and it was very important for us to do it with a school like Tsinghua.”
Held over the course of short, intensive time periods spread throughout the year, both sets of courses—a six-week, cross-continent field study for a professional certificate, and a two-year Master’s in Art Business Management in Beijing—are aimed at Chinese collectors and art professionals. According to Zhang Gan, the deputy dean of Tsinghua’s Academy of Arts and Design, the program will attract many business-minded Chinese professionals who want to develop their art expertise. “Many successful people in management lack knowledge of art. Today, more and more business leaders are developing a great interest in art,” he said. “It is, indeed, one of the important reasons we cooperate with Sotheby’s.”
Classes will be conducted jointly with the Tsinghua University School of Economics and Management and the Tsinghua University Academy of Arts & Design, providing both art and business education in order to respond to art’s rising role as a prime source of investment. “You can’t think of it as a traditional art history type of program. This is a program that combines knowledge of the art—which is the product—and the market, which makes us a unique educational venture in the sense that we are looking at both aspects of this very important cultural enterprise,” said Levy.
According to Chung, today’s art market requires business knowledge now more than ever as it rapidly evolves—especially in China’s investment-driven auction scene. “It’s becoming a real asset class just like some of the other derivative securities that are out there,” he said, noting that numbers are now more publicly available, art investment funds are springing up all over the world, and major galleries are rising to become “mini-conglomerates.” “We’re seeing the same trends happen that have happened in the hedge fund industries; that have happened in investment banking.” This is especially true for China, where Chinese investors prefer hard assets like real estate and collectible items over the mainland’s volatile stock market.
However, art management “is still a brand new course in our country,” says Zhang. “We really hoped to partner with a world-class international school that has a lot of practical experience. Sotheby’s is the best option for sure.”
Sotheby’s Institute isn’t the only major auction house responding to the Chinese art world’s demand for these types of courses. The education wing of global auction company Christie’s launched its first mainland education program in December 2012, in partnership with the China Europe International Business School (CEIBS), and Chinese competitor Beijing Poly recently announced a new art management and research center at the Guanghua School of Management at Peking University.
While Sotheby’s Institute and Sotheby’s auction house are separate entities, the Institute’s expansion to the mainland comes soon after a push by both Sotheby’s and Christie’s to establish a mainland auction presence. Sotheby’s held its first mainland auction in Beijing in December 2013, which followed soon after Christie’s own inaugural mainland auction that was held in September 2013 in Shanghai. Sotheby’s Institute also previously hosted short, intensive courses in Hangzhou and Hong Kong this past fall, which are often held based on individual requests.
For now, both of the six-week and two-year Tsinghua programs are expected to attract mainly Chinese attendees, and the six-week program will provide simultaneous translation from English to Mandarin. According to Zhang, the program’s global focus is a must for Chinese students hoping to work in the art world. “I believe the students who really want to work in the art field must have international perspectives,” he said.
Levy points out that as the Chinese art market becomes increasingly global, the program will lead to more opportunity for international connections. “There’s a growing interest in Chinese contemporary art in the West. If we are training a population of Chinese specialists who have an intimacy with the Chinese art world—not just the Chinese market, but the art world itself—I wouldn’t be surprised if some of those people actually find themselves moving into the Western markets from China rather than simply staying in China,” he said. “This is very likely, over a period of time, to become a two-way street.”