Banking bonuses in Dubai a windfall for art sales
Banker bonuses in Dubai are up, and so too are purchases of fine art to decorate their boardrooms and living rooms.
The rebound in the investment banking sector is boosting bonuses and the disposable income of the industry’s big earners – traditionally prolific buyers of art. That is good news for Art Dubai, which got under way in the emirate this week.
Junior bankers in Dubai are earning up to 36 per cent more than their counterparts in London, according to a new report from Emolument, and the booming economy and tax-free incomes across the country are boosting interest in the art world.
“There is a direct correlation. If people are feeling the pinch, art is one of the first industries to suffer,” said William Lawrie, the founder of Lawrie Shabibi art gallery. “Dubai as a business destination means so many people come through for business trips and spend an extra day for leisure and pop into the galleries. We find a lot of the works we sell are to people on business trips.”
Art purchases began to recover in 2010 and have been growing ever since. Many of the buyers are from around the region, mainly the GCC countries, Lebanon and Egypt, and work in the finance sector or are entrepreneurs.
The recent boom in the construction and property sectors in the UAE is stimulating the economy back into action. HSBC expects GDP growth of 4.5 per cent this year.
“Growth in the UAE economy is gaining speed and incomes are rising, and so too is construction activity. That kind of environment can only be supportive for the local art market,” said Simon Williams, the chief economist at HSBC Middle East.
Last night Christie’s, whose art sales account for 74 per cent of the region’s auction market, sold US$10.6m of artworks, an increase of 65 per cent on last year’s sales.
“It is very noticeable that Dubai itself is thriving at the moment. The situation we’re seeing here with Dubai Art Week is there are so many events going on, so many art collectors and art enthusiasts here at the moment,” said Michael Jeha, the managing director of the Middle East at Christie’s. “Since 2011 the art market has been thriving and going up considerably. In 2013, $13bn of art was sold at Christie’s [worldwide].”
Year-on-year bidding by Middle East clients in Christie’s art auctions around the world have been increasing by 30 per cent, according to Mr Jeha.
Last year Art Dubai welcomed 25,000 visitors and is expecting more this year. It has also increased the number of galleries exhibiting to 85, up 10 from last year, with greater interest from international museums and galleries.
“We have 17 international museum groups and we have a wide global reach this year,” said Savita Apte, director of Art Dubai. “So many creative artists from this region are being highlighted regionally as well as internationally which is what’s driving this interest from abroad.”
One first-time buyer at the show was on the lookout for something “eye-catching” for his new office in Erbil, Iraq.
“I am in town for business and decided to come take a look here,” said Daban Mustapha, an entrepreneur in communications. “I want some art to put around the meeting rooms and the office and Dubai is good for things like this. There is a lot of choice here, and it is an investment too.”
Follow us on Twitter @Ind_Insights
Updated: March 20, 2014 04:00 AM