The Covid-19 pandemic has affected every aspect of life around the globe, and the art market is no different. As the number of confirmed Covid-19 cases has risen, art events have been cancelled or postponed. One of the world’s largest art fairs, TEFAF Maastricht, was closed early after an exhibitor tested positive for the virus. (Our founder was scheduled to speak at an art conference held in conjunction with the event, but the conference has been postponed for a date in the near future.) Other art fairs followed suit, as well as cultural institutions, including museums, performance venues, and libraries. Despite these uncertain times, art transactions are still occurring, and we continue working with new and former clients on a variety of art and cultural heritage matters. We consult with individuals and entities, including artists, collectors, dealers and other industry professionals, as well as institutions and foundations, to craft short-term and long-term plans, and to successfully transact legal exchanges and actions. 

One financial vehicle available to collectors and dealers is the exploitation of their art assets as collateral for new art purchases and loans. Lending transactions involving art and luxury goods have become commonplace, and that has resulted in a variety of lenders offering this service, including boutique lenders (such as Athena), auction houses (such as Christie’s) and large banks (such as Emigrant Bank). We work with both collectors and dealers to maximize the value of their assets, including not only art, but other valuable holdings, such as watches, fine jewels, and musical instruments. We had the privilege of working with one of Manhattan’s most notable art collectors on successfully securing a $150 million-dollar loan against his artworks. In that particular instance, we attended to the transaction from the start to finish, and that gave us all the necessary information to successfully negotiate the terms of the agreement between the client and the bank, with a result that exceeded the client’s expectations. We work with a variety of clients, whether they are novice buyers or if their collections are valued in the hundreds of millions of dollars.

A number of issues we handle for clients under these circumstances include the process for securing collateral, the rights of a secured creditor in and to collateral, as against the rights of other creditors, and the risk assumed by a consignor that a dealer may convey to a third-party good title purchaser. Whether an art collector is interested in collateralizing his or her collection in order to take out a personal or business loan for covering expenses incurred as a result of the pandemic, sell assets, or acquire additional art pieces, we invite you to contact us about how we can work with you to assist with your art needs.