This post originally appeared on the Cultural Security Blog.
Art sales have shown time and again the veritable value of artwork. According to the TEFAF 2016 report global art sales reached $68.2 billion in 2014 and $63.8 billion in 2015–a year that culminated in the sale of Picasso’s Les Femmes d’Alger (Version ‘O’) for $179.4 million. The art market has become a genuine alternative to other global financial markets, and has proven its ability to withstand economic as well as geopolitical crises.
The art market reveals diversification in investment strategy with the “hard asset” status of artworks becoming increasingly discernible, and the collecting habits of high-net-worth collectors solidifying the “art-as-bullion” theory as artworks are purchased and then stored away in climate-controlled, top-security warehouses. A recent article by New York Times reporters Graham Bowley and Doreen Carvajal discusses how free ports have essentially become the “parking lot” of choice for these high-net-worth buyers looking to round out their investment portfolios with art.
The free port zone near the Geneva city center–an unremarkable compound characterized by lackluster buildings–is a prime example. Based on a 2012 audit of the free port, it’s postulated that roughly 1.2 million works of art–including Old Masters and an estimated 1,000 works by Picasso–have been squirreled away in this compound, aptly described in the NYTimes as “the kind of place where beauty goes to die.” Many of these artworks have not left the buildings in decades. Free ports, which originated in the 19th century for the temporary storage of teas and other goods, offer an ideal space to store art until it appreciates substantially in value. Not to mention the potential for enormous tax savings.
As the article highlights, for some collectors art is a capital asset. Collectors are becoming more financially savvy and free ports are now a pillar of all of this. There are, of course, innumerable arguments for and against the “art-as-bullion” approach to collecting, as well as for and against the use of free ports as art lockers for the super-rich. Concerns have been raised that these warehouse spaces may be used for illegal activities–such as storing contraband and money laundering–or that the very act of storing art long-term will be damaging to the pieces themselves. We also do not know exactly what artworks are hidden away. On the flip side, others argue that storing the artworks preserves them for longer. And dealers say that generally artworks eventually resurface.
There is also the opinion that art should not be treated as a commodity, that hiding masterpieces away is shameful, that perhaps the boxing up of millions of valuable artworks perverts the very essence of what art is supposed to do. It seems quite possible that these free ports may just be the greatest museums no one can see.
Is keeping artwork away from the public perverse? How do we walk that tricky line between art as heritage and art as commodity? And–as we ever should–we must keep that pessimistic, yet realistic, outlook that these warehouse may serve as the perfect sites for illegal activities, or even that these “great museums” of hidden treasures will be targeted by insurgent groups seeking to make a detrimental impact on humanity by destroying cultural heritage.