What to Buy Instead of Art

You could spend millions of dollars on a single painting at auction this week, or you could buy 111 Ferraris. Here's how to make those tough calls.

By James Tarmy • November 13, 2017

It’s November in New York, which means billionaires far and wide are about to fly in (or pay an advisor to fly in) to bid on art that often costs more than a hundred-thousand dollars per square inch. Some of the artworks lined up for sale at Sotheby’s and Christie’s evening sales should sell for tens of millions of dollars, if not more than a hundred.

Remember: these are paintings, mostly. Sometimes small paintings. And a “disappointing” result where one “only” sells for its low estimate could still represent an amount of money that could purchase a fleet of Ferraris or a private island.

So without further ado, let’s look at what you could buy instead of art this week, and why you might want to.

You have $100 million to spend...

Leonardo da Vinci’s Salvator Mundi, c. 1500

Pros

  • You’d get to own one of a handful of known Leonardo paintings in existence, an item that, if it were in a museum, would be regarded as priceless.
  • Even so, if you paid the estimated price, you’d be getting a bargain; its last owner paid a reported $127 million.

Cons

  • However sought-after a Leonardo might be, it’s a definitively nonliquid asset. If there’s a downturn and you need to sell it off, there’s a finite number of billionaires out there who could possibly take it off your wall.
  • It might be too famous for its own good—works of this stature are constantly being requested for museum exhibitions and loans, which means it’d be on the road as often as it’s on your walls.
Source: Christie's
VS

The 2017-18 academic year’s room, board, tuition, and other fees for the entire Princeton University Class of 2021

Pros

  • Princeton has actually led the field in awarding full rides to students whose families earn less than $140,000 a year; even so, fully subsidizing an entire Ivy League class would go a long way to making a traditional bastion of the elite even more diverse.
  • Imagine the thank-you notes.

Cons

  • In terms of return on investment, Harvard, Penn, and Columbia’s graduates end up wealthier.
  • You’d have to listen to stories about eating clubs.
Source: Getty Images
You have $50 million to spend...

Andy Warhol’s Sixty Last Suppers, 1986

Pros

  • The Warhol market has lost steam in recent years: In 2016, his market volume had plunged almost 74 percent from its high. But that temporary fatigue could represent a profound buying opportunity, given that of all the market stars to rise and fall, Warhol almost certainly will surge again.
  • Who needs wallpaper when you have a 33-foot-long painting?

Cons

  • The work was painted very late in his career, during a period that’s generally considered less desirable by collectors.
  • Very large-scale artworks are sometimes harder to sell. (Wall space, you know.)
Source: Christie's
VS

Christie Brinkley’s Hamptons Real Estate

Pros

  • Comprising two properties (one $20 million colonial on 4.44 acres in Sag Harbor, and another $29.5 million, 20-acre compound in Bridgehampton North), the 1990s supermodel is selling more than 16,000 total square feet of houses; while the market for mega mansions has dipped slightly over the last season, prices for property—especially property that can be turned into a compound—have continued to steadily increase.

Cons

  • “Bridgehampton North” is real estate broker code for “very far from the beach.”
  • In the world of the Hamptons, these are almost considered teardowns.
Source: Douglas Elliman Real Estate
You have $65 million to spend...

Fernand Léger’s Contraste de Formes, 1913

Pros

  • Let’s say you’ve begun estate planning (for a very large estate). You could conceivably purchase this work, transfer it (for a minimal sum) into an irrevocable trust that benefits your heirs, thereby avoiding traditional estate taxes. (When the work is sold, however, the trust would have to pay capital gains tax.) As an added plus, to continue to enjoy the art, you would pay rent—transferring yet more wealth– into the trust for the privilege of looking at this lovely Léger.

Cons

  • If you paid full price you’d be setting a record for a Léger at auction—the highest price for a Léger was set nine years ago, when a work sold at Sotheby’s New York for $39 million. The highest price paid for a Léger from the same period as Contraste de Formes was all the way back in 2003, when someone spent $22.4 million at Christie’s New York. You wouldn’t just be buying at the top, in other words, you’d be soaring well above it.
Source: Christie's
VS

Purdue’s new football performance complex

Pros

  • The 112,000-square-foot complex is meant to put the Big Ten’s team back on top. Much more than that, if you had a particularly good year in the market (and this year, pretty much everyone has), you’ll be looking at a hefty capital gains tax; by donating stock instead of hard cash, you’d be able to write off the market value of the equities but dodge the gains tax altogether.

Cons

  • You’d be backing a long shot—Purdue hasn’t appeared in a bowl game since 2012.
Photographer: Christy Radecic
You have $50 million to spend...

Vincent Van Gogh’s Laboureur dans un Champ, 1889

Pros

  • You’d be hard-pressed to find a work that’s more representative of his style than this, which means it will remain among his most sought-after.
  • It has a sterling provenance, most recently having remained in the collection of the oil billionaires Nancy Lee and Perry R. Bass for more than 30 years.

Cons

  • The market for Impressionist and modern art isn’t going away, but it’s slowed down considerably since the category’s highs in the late 1980s. You’d be buying an asset, in other words, that won’t appreciate nearly as quickly as comparables, both in the art market and in the broader US and global equity market. Given that you’re probably not buying it purely out of love for landscapes, it’s worth considering how much you’re willing to lose on it in terms of opportunity costs.
  • And don’t forget about insurance!
Source: Christie's
VS

A Gulfstream G500 jet

Pros

  • You’ll never have to deal with a boarding gate again.
  • In case of nuclear war, or an Independence Day style attack Washington, it can seat up to 19 people or sleep as many as 8, and has a max range of 5,200 nautical miles, which would easily get you from New York to the Azores.

Cons

  • $50 million is just the beginning. You’ve got to pay for air hours, fuel, cabin crew, champagne, and so forth.
  • There’s your carbon footprint to consider.
Source: Gulfstream
You have $45 million to spend...

Francis Bacon’s Three Studies of George Dyer, 1966

Pros

  • An early triple portrait of Bacon’s lover, the haunting series is a prime example of his trademark, quasi-surreal, semi-abstract style. The work’s obvious personal significance to the artist, plus its clear identifiability (no one’s going to think that’s anything but a Francis Bacon), will go a long way to helping it retain its value.
  • Several U.S. states, including Oregon, New Hampshire, and Delaware, offer incentives for wealthy buyers: If immediately after buying the work, a collector loans it to a museum in one of those states, the buyer can avoid paying sales tax; assuming a New York buyer would be paying an 8.875 percent tax on the estimated price of the Bacon, you’d be looking at a savings of about $5.8 million.

Cons

  • The Bacon market has been fairly volatile recently—after a painting estimated at $78 million failed to find a single buyer in London, people are skittish. This triptych, in other words, is by no means a guaranteed winner.
  • These aren’t exactly sunny paintings; you’d better make sure you’ve got a place to hang them that won’t feel like a funeral parlor.
Source: Sotheby's
VS

A 500-acre private island in the Caribbean

Pros

  • With more than 500 acres of island surrounded by white sandy beaches, this fragment of literal paradise is just 250 miles from Miami.
  • The highest elevation is around 80 feet, an unusually lofty clearance for the Bahamas. Most important, you can develop it: The seller already has a “proposed development plan” in its prospectus, and the island has already been confirmed to support a 3,000 to 5,000 foot runway. Turn it into a private compound or monetize it by creating a luxury resort.

Cons

  • As we’ve seen recently, hurricanes present more than a little bit of trouble in paradise.
  • It’s almost totally undeveloped, so any buyer would have to sink millions into making it habitable.
Source: Private Islands Inc.
You have $40 million to spend...

Cy Twombly’s Untitled from 2005

Pros

  • It’s a massive canvas, more than 10 feet high and 16 feet wide, which means you’d certainly be getting bang for your buck ($233,918 per square foot, to be exact).
  • It’s also a striking one. Unlike many works by Twombly, this one is bright, bold, and unsubtle—the definition of a statement piece. (And given you’d be paying 54,571 percent more than the average US household income for an artwork, you’d be forgiven for wanting people to know about it.)

Cons

  • It hung in a New York hotel lobby for several years before going up to auction, which means you aren’t exactly buying a hidden gem.
  • It’s from his late period, which many consider less important than his works from the 1960s.
Source: Christie's
VS

Every single work in Sotheby’s Nov. 15 impressionist and modern art auction

Pros

  • The 303 scheduled lots carry total estimates of $39.9 million to $57.9 million; assuming they meet but don’t exceed expectations, you could be the proud owner of lovely paintings by Edgar Degas, Paul Cézanne, Joan Miró, and dozens of others.
  • You’d never have to go to an auction again.

Cons

  • Three hundred artworks aren’t exactly easy to showcase.
  • Even someone buying lower-priced art is still often approaching it as a store of value. Despite the diversified portfolio you’d get from such a large stock of art, the impressionist and modern category, particularly when it comes to the lower end, isn’t going gangbusters. One mega-work like the Twombly, in other words, could represent a better monetary investment than hundreds of the works in the day sale.
Source: Sotheby's
You have $40 million to spend...

Andy Warhol’s Mao, 1972

Pros

  • This massive work has been in the same collection since the year it was painted, which is, as far as provenances go, as good as it gets.
  • Unlike some of the works in the Mao series, this one is gorgeous, with luscious blues and a light yellow hue.

Cons

  • Maos have performed unevenly recently. A smaller Warhol Mao, painted a year after this one, went up to auction in April in Hong Kong and barely surpassed its low estimate, selling, with premium, for $12.7 million. That’s certainly substantial, but charging nearly double that amount for a work (which admittedly is twice as large) just seven months later seems like an aggressive move, to say the least.
  • It’s a huge picture of Mao.
Source: Sotheby's
VS

A 5,000-acre Irish estate owned by the Guinness family

Pros

  • “Luggala,” a sprawling property set in a valley overlooking a lake, features a 19,000-square-foot, 18th century house that’s been magnificently maintained by its present owners, the Guinness family.
  • The property is a sort of Eden, with landscaped gardens, Irish oak woods, lakes, and follies, and one of the last great estates in Ireland.

Cons

  • 5,000 acres might feel a little excessive, lawn-mowing-wise.
  • Irish property taxes are relatively steep, and further hikes appear to be on the horizon. Currently, without deductions, annual local property taxes would be about $81,000. Don’t forget about maintenance, though.
Photographer: Antonio Martinelli
You have $35 million to spend...

Mark Rothko’s Saffron, 1957

Pros

  • This is as iconic as it gets, in terms of American modernism. An admittedly larger work by the artist in the same color palette set a record in 2012 when it sold for a stunning $86.9 million at Christie’s New York; all of the top 10 Rothkos at auction have sold for more than $44 million, and all of the top 20 have sold for more than $22 million. You might be spending a lot of money, in other words, but you’d be in good company.
  • Plus, the colors are Rothko’s most sought-after, being-it’s thought—sunny and light.

Cons

  • Rothko’s market is difficult to judge simply given the relative scarcity of his work at auction. That said, we’ve only seen a single work crack this lot’s price range in the past two years. The work that did, a 1957 painting (the same year as the present lot) was estimated to sell for $30 million to $40 million and barely made its low estimate, selling, with premium, for $32.6 million. The market for Rothko, in other words, might be weaker than auction houses would like to acknowledge.
Source: Christie's
VS

55-meter sailing yacht

Pros

  • The Marie has room for eight guests and a crew of eight to match, and features a light, open-plan interior.
  • You can’t get prettier lines on a boat than that.

Cons

  • If you’re going to buy a yacht, you might want one that doesn’t tilt to the side when it goes fast.
  • Always remember: The two most pleasurable days of boat ownership are the day you buy it and the day you sell it.
Source: Boat International
You have $35 million to spend...

Jean Michel Basquiat’s Il Duce, 1982

Pros

  • The Basquiat market has been on fire lately, and this one is priced relatively conservatively.
  • It’s from 1982, considered a prime year for the artist, and its gold, sparkling paint is a surefire draw if you like a little glitter with your “graffiti-inspired” blue chip art.

Cons

  • For the same reason that the market is on fire, there’s a chance that you’re buying into an overhyped field.
  • Given that the most prominent recent Basquiat collector, a Japanese internet billionaire named Yusaku Maezawa, has shown no signs of slowing down, there’s a good chance you’ll be bidding against someone with deeper pockets than yourself. He set a record earlier this year, when he spent $110 million on a Basquiat that carried an estimate of about $60 million.
Source: Christie's
VS

111 Ferrari 812 Superfasts at $315,000 apiece

Pros

  • You’d never have to drive the same car for more than three days a year.
  • Maybe you could turn it into a high-end Zipcar for friends and family?

Cons

  • You’d have to find somewhere to store 111 cars.
Source: Ferrari
You have $30 million to spend...

Pablo Picasso’s Femme Accroupie, 1954

Pros

  • A gorgeous, colorful Picasso, whose abstraction isn’t enough to obscure the sunny setting and the beauty of the sitter.
  • Art might be an uncertain investment, but this is like a money market fund: It could go down, but it probably won’t.

Cons

  • There are a lot of Picassos out there, and not all of them sell for 10-figure sums. The market structure for Picasso’s art is complicated and, at times, seemingly arbitrary, which means that anyone with a mere $2 million to $4 million could buy a gorgeous landscape by the artist at the same sale, or go uptown to Sotheby’s to buy his magnificent Homme Assis Au Casque et a L´épée, (estimate: $8 million to $12 million) saving up to $22 million in the process.
Source: Christie's
VS

48 of Rafael Nadal’s $725,000 Richard Mille watches

Pros

  • There is literally no reason to have this number of the same watch, and it’s doubtful Richard Mille would make them for you.
  • Unless, perhaps, for six kids: Best Hannukah ever!

Cons

  • Maybe you would like to wear a $700,000 watch that is a little more subtle.
  • Maybe you would like more than one kind of $700,000 watch.
Source: Richard Mille