Majority of Art Collectors Would Consider Sustainable Options--With One in Four Willing to Pay Over 25 Percent More for Them, Reveals New Report by UBS Global Wealth Management

In a special edition of its Investor Watch Pulse Report, produced in collaboration with Art Economics, UBS presents new findings and insights on the habits of US high-net-worth art collectors:

- Six in 10 art collectors have thought about sustainable options when purchasing art or managing collections--with one in four willing to pay 25 percent or more above normal price for sustainable options

- Over half of women surveyed (51 percent) spent over $1m in the past two years on art, compared to just 15 percent of men

- Collectors still see important roles for museums, with women more likely to leave some or all of their collection to them (68 percent)

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Dec 03, 2019, 10:39 ET

MIAMI, Dec. 3, 2019 /PRNewswire/ -- UBS Global Wealth Management released a new report today, produced in collaboration with Art Economics, that reveals collectors are increasingly valuing sustainable art options—and are willing to pay more for them. This special edition Investor Watch Pulse Report, titled "The new modern," surveyed 404 investors in the US with at least $1 million USD in investable assets.

Collectors are valuing sustainable options

Sustainability ranks as one of the top art market concerns for collectors alongside accountability of museums and public institutions, legal issues in the art trade (e.g. restitution cases and forgeries) and barriers to the free movement of art internationally.

As the world increasingly focuses on sustainable options for investments and everyday consumer purchases, we're seeing more sustainable options being considered in the art market—59 percent of collectors have thought about sustainable options in purchasing art and managing art collections. Millennials in particular have weighed it even more heavily, with 86 percent considering more sustainable ways to purchase art and manage their collections.

What's more, 86 percent of art collectors are willing to pay more for sustainable options, with one in four willing to pay 25 percent or more above normal price for it.

"Collectors increasingly see no need to compromise their values when making decisions about something as personal as their art collections," says John Mathews, Head of Ultra High Net Worth Americas at UBS Global Wealth Management. "This mindset is only going to continue to become the norm as millennials increasingly adopt sustainable practices and more options become available on the market."

Women are active art spenders with the collections to show for it

Over half (51 percent) of women surveyed have spent over $1m in the past two years on art, compared to just 15 percent of men. And the size of their collections reflect this spend—women have a median collection size of 88 works while men's collections are smaller at 27.

"In UBS's recent Own Your Worth study, we found that 83 percent of women participate in large purchase decisions. It's great to see passion for art is a key component of this, and with the great wealth transfer well underway, where we will see women controlling 32% of all wealth (US $72 trillion)^[1], this is opening up opportunities for women to get more involved with art and collecting,"said Karl Ruppert, Private Wealth Management Market Head for Florida at UBS Global Wealth Management.

Women are more likely to leave their art collection to museums (68 percent) and charitable organization (69 percent).

Museums maintain an important role for collectors

When it comes to museums, collectors value them as important sources of education, guardians of cultural history, venues for cultural exchange for lending and displaying collections and centers for social change. That's why it comes as no surprise that more than half of collectors (53 percent) plan on leaving their art to museums—with millennials especially keen on doing so at 73 percent.

Still, many plan on leaving parts of their collection to family as well. More than three quarters plan to leaving some or all of their collection to their children/grandchildren/spouse/partner.

As collectors think about transferring their collections onto the next generation, half of art collectors (51 percent) are worried their heirs won't get a fair selling price. To help prepare for a seamless change in hands, seven in 10 (73 percent) have already taken steps to show heirs how to manage their collection.

"Many collectors have worked hard over the years to carefully curate their collections and planning can help keep collectors' passions alive, whether that's within the family or outside," continues Mathews. "As tastes change over generations, we're seeing collectors have conversations about how their families can continue caring for collections—some even engaging with museums and charitable organizations as part of that process."

For more insights and to download the report, visit ubs.com/investorwatch.

^[1] Boston Consulting Group, New Strategies for Nontraditional Client Segments, 2016

SOURCE UBS