© Louvre Abu Dhabi, Photography: Mohamed Somji.
Last week, when Sotheby』s finally closed its deal with the Abu Dhabi–based sovereign wealth fund ADQ for a $1 billion cash injection, the sense of relief was palpable. The investment will not only go a long way toward helping the debt-laden auction house clear the red out of its ledger, but also perhaps help position Sotheby』s for a more robust future. CEO Charles Stewart has been pushing to evolve Sotheby』s into a globally-recognized luxury brand beyond the art world. Maybe the cash helps the company get there.
Last month, the United Arab Emirates』 capital was named the world』s wealthiest city, as determined by assets managed by sovereign wealth funds. For over a decade, Abu Dhabi has been using that cash to chase a similar goal as Sotheby』s: to become a household luxury brand. In the mid-2000s, Abu Dhabi began its $27 billion project to develop Saadiyat Island into a cultural and tourism destination. The $650 million crown jewel, the Louvre Abu Dhabi, opened in late 2017 and was declared the 「world』s first universal museum」 for its global perspective on art history. In 2026, a new Frank Gehry–designed branch of the Guggenheim is slated to open next door; it will bring Western contemporary masterworks by Richard Prince, Frank Stella, and Donald Judd frame to frame with influential artists from the region and further east, among them Ghada Amer, Adel El-Siwi, and Zhang Hongtu.
Both the Louvre and the Guggenheim stem from the UAE』s 2005 plan to diversify its economy by pumping billions into cultural tourism. The third initiative from that era was the annual art fair Abu Dhabi Art, which began in 2007 as ArtParis Abu Dhabi and was rebranded and taken over by the Abu Dhabi Tourism Development & Investment Company in 2009. Not long after the takeover, Rita Aoun Abdo, the executive director of culture for TDIC, called the fair 「part of a greater vision to build transnational cultural institutions to ensure that the Arab world is not isolated.」 But, at least according to some art dealers, the fair—set to open its 16th edition later this month—has far from lived up to that hype.
Related Articles
AI Robot’s Painting Smashes High Estimate at Sotheby’s, Pompeii Victims Not Who Previously Thought, and More: Morning Links for November 8, 2024
Artwork Made by Humanoid Robot Ai-Da Using AI Algorithms Sells for $1 M. at Sotheby’s
One influential mid-size New York dealer with experience in the region, who, like many other sources for this piece, asked to remain anonymous to protect their relationships, told ARTnews that the fair is more 「a private trunk show than an actual art fair,」 especially when compared to Art Dubai.
As Ben Floyd, CEO of Art Dubai, put it, Dubai is the center of the Gulf』s art market, where the vast majority of galleries are based and where auction houses have placed their regional headquarters. Abu Dhabi, by comparison, has focused on institutional development, he said.
「Dubai has heart,」 Hattie Bowring, creative director at Citizen Global and Wild Media, told ARTnews. 「It』s where all the commercial galleries are, and though it still has bits that are rough around the edges, it』s being manicured as we speak. Abu Dhabi, by comparison, is the more staid older brother.」
That could soon change, if the rumors swirling in the art world are true. Numerous sources based in the US, Europe, and the Middle East told ARTnews that Art Basel is deep in negotiations to take over Abu Dhabi Art. The rough contours of the rumored deal would see Art Basel receive a $20 million investment in exchange for operating the Abu Dhabi fair.
When asked about the possible deal, a rep for Art Basel told ARTnews that 「as a general policy, we don』t comment on speculation.」 TDIC, which owns Abu Dhabi Art, did not respond to requests for comment.
It』s an open secret among the art world intelligentsia that Art Basel has been in financial trouble lately, despite the company』s recent success in Paris, which many believe will be the new European center of the art world. The fair』s parent company, MCH Group, has seen net income fall over 41 percent year-on-year from a loss of CHF9.01 million to a larger loss of CHF12.77 million, according to the Financial Times, due to 「an increase in the selling, general and administrative costs as a percentage of sales.」 MCH share prices have been on a consistent downward trajectory since 2020, to boot.
One source familiar with the deal told ARTnews that there』s a lot of pressure within MCH for Art Basel』s CEO Noah Horowitz to deliver big deals that could ease the financial pressure on the company.
That pressure is being felt across the art world. Endeavor Group Holdings, the parent company of Art Basel』s main competitor, Frieze, announced last month that it』s considering selling off some of its event assets, including Frieze magazine and art fairs in London, New York, Los Angeles, Seoul, and Chicago. It』s very likely, experts have told ARTnews, that art fairs are feeling the same pinch that galleries and auction houses are feeling, given high post-Covid interest rates and steep global increases in the costs of shipping, storage, and travel.
Like the auction houses and galleries that launched outposts during Covid, it』s very likely that Art Basel is going where the money is, one Europe-based art adviser told ARTnews. 「The Brits and Europeans are holding off spending or diversifying their portfolios. The Russians can』t spend and the Chinese are struggling to get money out. The big brands have to follow the money, and the reality is that the wealthy are already moving to the UAE for tax reasons,」 the adviser said.
Over the last few years the UAE has seen a massive influx of high-net-worth individuals and billionaires from the West who want to shield their assets from pesky tax collectors, and from the Middle East who see the UAE as a haven in a politically unstable region.
But does the world need another art fair? According to a soon-to-be-published Citizen Global report obtained by ARTnews that examines the Middle Eastern cultural landscape over the last 20 years, local communities in the UAE are skeptical about the priorities of big Western institutional projects coming into the region. Those communities worry about how relevant these projects will be to a strong network of regional artists and curators.
And what about the collector class, who, according to a recent survey of global collectors produced by Art Basel and UBS, have become increasingly concerned about where they show up, while art fairs slowly begin to skew more regional? Can they be convinced to attend another fair, this time in the UAE?
「Anyone who tells you that the narrative inside the industry isn』t one that points a critical eye at the frequency, scale, and complications of the current art fair circuit is either not up to speed or lying,」 Max Fishko, an art fair veteran who has produced over 100 fairs, told ARTnews. 「That』s the tip of the tongue for everyone. Collectors, consultants, dealers, everyone.」