(Part 2 of an exclusive Pinkwater Report three-part series)
As the art market has exploded, so has the property market. Both are now seen as alternate investment classes, not just lifestyle choices. As art has become bigger, and property development is on a hot streak, with the buyers of both being exactly the same people, how is property development reflecting the collection of bigger art, and how are the synergies starting to show in new development property?
The mingling of art and real estate has a history nearly as long as life itself, from the caves of Lascaux, to the pyramids, to Rockefeller Center right here in New York. But the current incarnation of this trend, moving front and center in the selling of ultra expensive residences comes in many forms.
“We see a direct correlation between trophy paintings and trophy properties. Someone will buy a work of art, then want to buy a property to display it in,” according to Giles Hannah, senior vice-president of Christie’s International Real Estate. “Increasingly, developers are using art as a major feature in their projects as good art sells a property, almost like dressing an apartment well. It gives a wow factor and adds value.”
The mingling of art and real estate has a history nearly as long as life itself, from the caves of Lascaux, to the pyramids, to Rockefeller Center right here in New York.
“Art adds timeless value to a building and is a way to add energy and inspiration to the interiors,” says Cheryl Urban, VP of marketing and branding for Equity Residential in NYC. These artworks increasingly being integrated into luxury properties are estimated to add 3% to 4% to the value of the buildings.
They also, of course, help differentiate the projects.
“People like to be able to talk about their building and have others know it, for people to feel they live somewhere unique” says Raphael De Niro, a Douglas Elliman broker. DeNiro is referring to 135 W. 52nd Street, for which his firm hired famed lighting designer Thierry Dreyfus to create a 423-foot installation to adorn the front of the building.
In a recent article in the New York Post Emily Santangelo, who consults with residential developers on weaving art into their projects, says “When you go to see four to five properties a day, what is going to stand out? The one with the Jeff Koons …or…the one with the really cool, 12-foot-long Orly Genger watercolour (at 400 Park Avenue South, which Santangelo is working on with Toll Brothers City Living.) Everyone recognizes a piece that makes you feel good — especially when it might be placed at your front door.”
“There is a very strong art market right now, with a much more diverse and large collector base than at any other time I can remember,” said Yvonne Force Villareal, who recently founded Culture Corps, an art consulting business that advises real estate developers. The expanded art collector base has resulted in more buyers of high-end condos wanting artwork to be part of the experience of shopping for a new home.
Culture Corps is consulting to 30 Park Place, the condominium that will also feature a Four Seasons hotel. Culture Corps has chosen eleven pieces of art for the space, including both works by established artists like Richard Serra and Sam Gordon as well as those by newcomers.
The developer, Silverstein Properties, bought some of the works; the others are on loan. “It is not the normal kind of art you would see in a model apartment,” said Ms. Villareal. All abstract, the paintings “are very tasteful, but they also have an edge to them.”
One developer, Time Equities, has even gone so far as to add an artist-in-residence program to booming downtown 50 West Street building. Time Equities CEO, Francis Greenburger, has also brought in an in-house curator, Jennie Lamensdorf, and has traded free studio space to emerging artists in exchange for their artistic works documenting the creation of the building itself. When 50 West is complete, these works will hang in its common spaces.
According to Greenburger, “The lobby is like a gallery, with the work on display visible from inside and outside the building. It’s even become an ‘alternative’ arts venue, and what we show here is reviewed by the art press.” Much of the art in Time’s buildings belongs to the building itself, and is considered part of the structure.
Contemporary New York City was defined by artist-led gentrification. The city is the birthplace of loft living culture and a pivotal player in the global art scene, home to the major auction houses and galleries. In some respects, New York has come full circle, from abandoned warehouses transformed into art studios and then sold off to become loft apartments and galleries. In recent years, developers have realised the importance of the collector, creating properties for buyers schooled in the visual arts and demanding the best way to display their own collections.
One such property is The Schumacher.
A former printworks in NoHo, The Schumacher has been painstakingly restored to its original shell with decoration reinstated and tough, hardwearing materials exposed. Its developer, Roy Stillman, partnered with gallerist Cristina Grajales on the marketing of the building.
“I’m lucky to be collaborating with someone like Roy,” says Grajales. “He really gets it – he cares about the quality, the details in all the building he creates. He goes the extra mile in order to create something that is timeless.”
The building lends itself to monumental scale, with thick floors designed to take hefty printing equipment. “From the minute I saw the Schumacher, when I looked at its foundation and structure, it spoke to me as a sculpture,” says Grajales, “it was very refreshing to look at a building that had substantial walls. I immediately thought of collectors of art and sculpture.”
Collectors see the Schumacher’s robust qualities as a suitable place to display the increasingly substantial output of contemporary artists. They were helped along by Grajales’s carefully presented sales suite, resembling an elegant art gallery and described as such. “The only thing we had to work from were blueprints, so we enlarged them almost as if they were paintings. It became like an exhibition in Chelsea.”
Artwork by José Parlá and bespoke design by Christophe Côme will grace the shared spaces of the Schumacher when it opens in 2015. Stillman has other projects – and more collaborations with Grajales – on the horizon, mindful that the city’s relentless torrent of condo-building needs more and more specialisation if properties are to find a buyer.
Our sources tell us that the entire building is sold out except for two penthouses. Two well-known art aficionados have purchased in the building — RFR Holding CEO Aby Rosen and art collector/dealer Alberto Mugrabi.
Mugrabi visited the sales center with the developer with “no intention of buying an apartment” but soon “fell in love with the project.” He has acquired the rights to display a sculpture in the courtyard.
We recently spoke to Roy Stillman about The Schumacher:
Early on, the developer’s job is to discern the soul of the building and to understand its orientation.
Royce Pinkwater: Some developments are more suitable to the culture of art collectors than
others. Is that a conscious part of design process?
Roy Stillman: Yes. Early on, the developer’s job is to discern the soul of the building and to understand its orientation. In the case of the Schumacher, the voice was loud and clear, insistent in fact, in being a champion of the art cultures. The first chord in the voice was the original structure of the building. Powerful, fortress-like exterior walls create an environment that protects the residents from the noise and vibration of the city. They also establish a perfect setting for the placement of art.
RP: The individual apartments have a “gallery” feel.
RS: My intention was to make the Schumacher attractive to the art community. The design team preserved large expanses of solid walls on the interior of most homes, enabling owners to curate their own museums. In fact, one owner requested demising walls made of cement block and steel – a veritable vault to ensure no unwanted visitors to the collection when the owner is away.
RP: In the Schumacher, you’ve also created a courtyard space that can be used as sort of a communal gallery.
RS: That’s right. The design team expanded the confines of the traditional art space by creating an inner courtyard that is both an art installation in its own right, and the exhibition space for the placement of monumental sculptures. In that way, the world-class collections of some residents can be enjoyed by other owners. To accomplish this feat, the developer hired world-renowned landscape architect Ken Smith, of Museum of Modern Art fame. Ken Smith is a visionary; he transformed a courtyard into a unique piece of art, worthy of the world stage.
RP: What did you see in the market that led you to develop the Schumacher as you have?
RS: I saw that the big contemporary art collectors were looking for properties that would best display their collections. So I looked for and found a building with the perfect characteristics. After that, the team gave a great deal of thought to what other elements would enhance a world class art collection.
RP: Has the development of the Schumacher worked out as you hoped?
RS: It has. Ultimately, the vision of the developer and design team turned out to be prescient. The Schumacher has attracted art patrons and industry insiders from the highest echelon of the field.
The last quarter of 2014 saw Manhattan prices rise 20%, exceeding the levels reached in 2008, with 2,718 properties achieving an average sale price of $1,718,531 in Q4. NYC’s status as an art-driven city was consolidated by the arrival of Frieze NY in 2011 and there’s a parallel between the rise of the big name architect and the big name artist; both present acquisitions that combine cultural worth with investment potential.
And indeed the big names are out in force on the New York skyline, and the High Line is a main artery, from Zaha Hadid at 520 West 28th Street to SCDA Architects, led by Soo K. Chan, Soori High Line and Peter Marino and Michael Shvo’s The Getty at 239 Tenth Avenue. The latter is described as ‘the intersection of art and architecture,’ with Marino telling an audience at Design Miami that the black bronze building’s eight apartments will each be ‘unique works of art,’ with six artists – as yet unnamed – collaborating on ‘various aspects of the project.’
Across town, Jean Nouvel’s super-tall MoMA Tower, a decade in the making, makes explicit reference to its near neighbour and former owner of the 240,000 square feet of air rights which it will occupy. The 82-storey tower, which will contain 139 apartments, including duplexes and full-floor apartments, will also house three lower floors occupied by MoMA, creating museum spaces open to the public, part of larger expansion plan by MoMA. Buyers of the tower’s residences will qualify for special membership at the museum.
Downtown, Herzog and de Meuron’s 215 Chrystie, in collaboration with John Pawson and Ian Schrager, takes a boutique approach to styling supersize apartments. Further downtown, in Tribeca, the Swiss firm has a more overtly art-centric undertaking — they envisioned their one-of-a-kind development itself as a piece of modern art planted in the middle of the old manufacturing neighborhood.
Their 60-storey 56 Leonard St has been nicknamed “Jenga Tower” for its cantilevered modern art glass façade. In addition, a monumental dazzling new steel installation by Anish Kapoor, his first in NYC, is seamlessly integrated into the base of the building, spilling out into the street. Art has become an integral part of the city’s economic story, a synergy made explicit by Kapoor’s polished, gleaming sculpture.
Also in Tribeca is 93 Worth St, a former knitting factory converted into lofts. Its developer, IGI USA is stocking the building with the work of young Israeli photographer David Kassman, who is producing a series of nature-themed photographs. Eldad Blaustein, CEO of IGI USA, says, “Art is a valuable aspect. Our buyers are mainly local families who are buying to live here. Kassman’s photos give the building a sense of locality so that it’s more than just bricks and walls; it’s inspirational and brings an elegance, colour and freshness to the project.”
Elsewhere, the new breed of Chelsea apartment is epitomised by 505 W19, Thomas Juul-Hansen’s twin ten-storey condo towers, clad in grey limestone with full-height interior spaces that make perfect private galleries. Outside, the life and activity of the High Line itself winds between the two towers. Priced from around $3.8m, 505W19 is a statement address in the heart of a transformed city, surrounded by new architecture, new galleries and the possibility of growth.
The marriage of art and prime development that we’ve seen in Miami and New York, we’re also seeing in Los Angeles. In the last part of this article we’ll take a look at
what’s happening in the City of Angels.
(This ends Part 2 of an exclusive Pinkwater Report three-part series. In Part 3, we take a look at Los Angeles.)