Collect art for fun and profit

Written by Rhea Seymour

Walk through the doors at 404 6th Avenue, and you could easily mistake the headquarters of Calgary-based Arcis Corp. for a thriving art gallery. Every available inch of wallspace is covered with dramatic photography and vibrant paintings by some of Canada’s most talented artists. But Arcis is a provider of oilfield services run by Peter Boyd, an entrepreneur with an attraction to the aesthetic.

Since 1986, when Boyd bought his first pieces of art — sculptures by Calgary artist Claude Luneau for $7,000 — he has amassed an impressive collection that includes hundreds of photographs, sculptures and paintings. “I’m always falling in love with art,” says Boyd. “I love color and how it’s put on canvas. It’s extraordinary that within certain artists is the ability to evoke emotion through a brush.”

In fact, collecting art is more than Boyd’s passion — he considers it his duty. Since governments lack the funds to support Canadian artists, says Boyd, it’s important for individuals and corporations to support Canada’s cultural heritage. “Some corporations don’t consider collecting art an appropriate use of funds,” he says. “I strongly disagree.”

Whether responsibility or recreation, collecting art can produce rich rewards. Great art can move you spiritually and financially. Collect wisely, and you can develop a money-making portfolio that also enhances your corporate image. Best of all, you can start small and without the benefit of a trained eye.

Boyd’s affair with art began as a child when he experienced works by the Group of Seven at the McMichael Gallery near Toronto. It wasn’t until he graduated from university and had some discretionary income that he invested in his hobby.

Today, with the help of art dealers across the country, Boyd scouts for works by Canadian emerging talents, such as Calgary’s Chris Cran, whose oil-on-canvas painting “Double Self-Portrait: Wanting to Know Why I Am Home So Late”, hangs in the Arcis lobby and is among Boyd’s favorite pieces.

In keeping with his give-back philosophy, Boyd regularly donates pieces to institutions, including the Glenbow Museum in Calgary. He recently gave $50,000 worth of drawings and paintings to the University of Lethbridge to educate visual arts students. “I believe quite strongly that if I’m collecting artists of national importance,” says Boyd, “then it’s my responsibility to pass it on.”

Salah Bachir is another CEO in the entrepreneurial art club. But unlike Boyd, Bachir launched his collection with two drawings in charcoal and Indian ink priced at $100. Today, the president of Famous Players Media Inc., publisher of movie magazines Premiere and Famous, owns about 500 works, including pieces by Andy Warhol and photographer Herb Ritts. “Art is an addiction for me,” explains Bachir. “Even at university, I figured, ‘Why put up posters if you can put up original art’.”

He got serious about collecting in his early 20s, developing friendships with artists and buying contemporary paintings through galleries and auction houses. Canadian artists Attila Richard Lukacs and Betty Goodwin are among his favorites. “[Goodwin’s] pieces are quite deep and I fall in love with her work,” he says. Of her piece “Distorted Events,” Bachir says: “It’s an incredible Holocaust piece. It speaks volumes to me about death, loss and life. It moves me.”

While buying art is usually predicated on passion, no one can deny its financial potential. Boyd typically keeps a piece for 10 years, then donates it at what’s likely to be an appreciated value. Since Boyd’s gifts are certified by the Canadian Cultural Review Board as Canadian cultural property, he gets a tax deduction and uses that money to buy more art. But be warned: Don’t expect to buy and flip art quickly for tax benefits. New Canada Revenue Agency rules deem the value of gifted property will be limited to the donor’s cost if it’s donated within three years of acquisition.

Still, Boyd believes collecting art is a smart financial investment. “You get the use and enjoyment out of the art, and if you buy smart, I believe you’ll have above-average returns.” According to David Heffel, president of Heffel Gallery Ltd., an art auction house with offices in Toronto and Vancouver, in 2002, paintings by Emily Carr and David Milne returned 8% to 10%, although the average return is roughly 5% annually.

Art has been a good investment for Gabe and Rossana Magnotta, too. Along with their personal art collection, the owners of Vaughn, Ont.-based Magnotta Wineries reproduce their favorite artwork on the labels of some 200 wine products.

In the early 1980s, the pair purchased their first piece of art from Greek-Canadian artist Manos Rovithis for $1,500. “We didn’t have a dining-room set, but we had beautiful art on our walls,” recalls Rossana. “Art brings me happiness. I love landscapes. I’m so busy, and landscapes make me feel like I’m part of a beautiful world and they give me solace.”

The idea of marrying their love of art and wine struck the couple when they were starting the winery during the recession in 1990. “We put everything we had into the company and didn’t have a lot of money for marketing initiatives,” recalls Rossana, “so we thought we’d use the art from our personal collection on the labels of our first two bottles of wine.” After getting permission from Rovithis to reproduce his work, the harvest scene graced the first red and white bottles of Magnotta’s Festa wine. Says Rossana: “That first bottle put us on the map.”

Art is not just pretty pictures. It can also enhance your professional image. “It’s difficult to measure, but I think the quality of your work environment and the stimulation of your employees are key ingredients in productivity improvement,” says Boyd. Bachir agrees: “When you have original art on your walls, you don’t seem like an operation that has just set up shop. It gives you a professional look.”

Whatever the professional advantages, collecting art is first about Bachir’s appreciation of art. Before you buy a piece, he advises, “You have to be in love with it.”

How to start your own art collection

You don’t have to be an art aficionado to get in on the collecting game. Start right with these tips from David Heffel, president of Heffel Gallery Ltd., an art auction house with offices in Toronto and Vancouver:

Do your research. Spend some time in galleries and museums to determine what areas of art interest you. Read survey books such as Canadian Art to find out how much an artist’s work sells for.

Look for a solid résumé. Typically an artist with a history of exhibitions in galleries and museums has better potential than an unknown street artist.

Find a dealer. Look for an art dealer who is a member of the Art Dealers Association of Canada. Dealers tend to specialize in certain areas, so if you’re interested in art by the Group of Seven, for instance, work with a dealer specializing in modern art.

Buyer beware. Treat investments in art as you would a speculative stock. While you’ll always enjoy the work, there’s no telling if it’ll pay dividends. Keep in mind you’ll get a better return on the most sought-after works of an artist.

Hold on. The art world tends to work in 10-year cycles. It usually takes a couple of years to recoup what you’ve spent in GST and PST alone.

© 2004 Rhea Seymour

Originally appeared on PROFITguide.com