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Quebec Art Market Offers Deals for Investors
Hidden North American gem could provide unique investment opportunity
Thomas Johansmeyer (tomj)     Print Article 
Published 2007-10-30 04:47 (KST)   
Buying art in Canada used to be a sure thing. A strong U.S. dollar made it easy to go north and take advantage of an implicit 30 percent discount -- sometimes more. The weak U.S. dollar has obliterated that advantage, but there still are reasons to check out Canadian art. Even with an unfavorable exchange rate, you can find deals without having to look too hard.

Step inside the walls of Vieux Quebec (Old Quebec), and you will see one gallery after another. Descend into La Basse-Ville, down the mountain from the walls and along the St. Lawrence River, and you will find a few streets that comprise a distinct art and antique district. Supply is seemingly endless, but what about quality?

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Not all art is investment grade in any market, and this is true in Quebec City as well. To find pieces with potential, expect to spend some time on the prowl. If you like winter landscapes, you do not have to look far. The lion's share of Quebec art features snow, trees and people in parkas (or on ice skates). Fortunately, there is more to Quebec than ubiquitous precipitation, and it is the "everything else" where you are most likely to find a winner. Large pop art pieces can be found in more than a few galleries, and they sell for a fraction of the prices they would fetch in the United States.

The style that appears to have the greatest potential for U.S. investors blends the traditional Quebec snowscape with vibrant colors and a geometric perspective that slices through the forests and hills.

Christian Bergeron exemplifies this approach and supports it with ample inventory. His work is widely available in Quebec City, both inside the walls and down in La Basse-Ville. Geometric forms affect a prismatic feel, intensified by stark reds, yellows and oranges. A simple barn, for example, is rendered three dimensional and abstract. The use of seemingly incongruous color nods to the autumn that precedes the scene rendered, resulting in a motion of the seasons that shows the passing of time over the static and mundane.

So, supply is sufficient, and there is a unique voice. An art collector or investor can find that anywhere. What makes the trip to Quebec City worthwhile?

The answer is price.

By American standards, Quebec art is cheap. Very cheap. In the United States, art investment advisor Richard Rabbito suggests a minimum price of $10,000 for art to be considered investment grade. But, in Quebec, a piece that could fetch $10,000 in Rabbito's Manhattan market lists in galleries at $3,000 to $4,000 and could sell for as little as $2,000 to $2,500. The result is an arbitrage situation for savvy art investors. It is possible to acquire pieces in Quebec and resell them fairly quickly in the United States at much higher prices.

There is anecdotal evidence to support this market opportunity. A gallery manager in Quebec has collectors who routinely visit the city to acquire art at seemingly bargain prices. Some come from as far away as Texas. The gallery manager has seen a decline in this behavior with the rise of the Canadian dollar but acknowledges that a price disparity between the Canadian and U.S. markets still exists. Also, New York artist Julio Aguilera confirms the disparity and has seen U.S. investors move substantial inventory from Canada to U.S. markets.

With such a wide price gap, one wonders why art investors in the United States have not moved into this market aggressively, bringing some price efficiency and shrinking the opportunity. The problem lies with the artists themselves. Many have been approached by U.S. dealers and galleries. When offered opportunities to enter more lucrative art markets in the United States, particularly in New York, Quebec artists simply do not believe the claims of their American suitors. And with a robust enough local market, they do not have to explore more exciting -- and riskier -- alternatives.

Since the primary market for Quebec art (i.e., the local galleries) is stabilized by local purchasers and lower artist expectations, the arbitrage opportunity for U.S. art investors is preserved. Until Americans move through Quebec in large numbers specifically for the purpose of investing in art, conditions are likely to remain favorable.
©2007 OhmyNews
Other articles by reporter Thomas Johansmeyer

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