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Engaging Consignment Services to Sell a Noteworthy Art Collection at Auction

Patrons viewing artwork

CLIENT PROFILE

A couple with a substantial art collection—worth tens of millions of dollars—had been in the process of estate planning with a U.S. Trust wealth strategist. When the wife passed away unexpectedly, the husband was determined to simplify his affairs by selling their collection of modern art. His U.S. Trust wealth strategist introduced him to the Art Services group to discuss various disposition options.

APPROACH

The Art Services group suggested that selling the art at auction could be a solution to raise cash for the client. However, approaching an auction house directly could result in significant seller fees as well as a standard auction listing, which would not have done the impressive collection justice. Therefore, to help the client attract some of the best potential buyers and competitive auction prices, the Art Services group recommended that he take advantage of U.S. Trust’s Consignment Services.

  • The group’s knowledge of the art market, combined with a consignment agreement with several auction houses, allowed our client to access preferred pricing and other services to significantly enhance his net profit from the sale.
  • The team orchestrated conversations with top auction houses to lay out the objectives of the sale and gauge interest.
  • For the top two lots being sold, our client requested a guarantee—a payment for the works even if the reserve price was not met.
  • For the remaining lots, the Art Services group asked that our client receive an enhanced hammer deal, eliminating seller’s fees on the lots. In addition, we proposed that he collect a portion of the buyer’s premium.

SOLUTIONS

After reviewing the offers from the three auction houses with his advisor, the client chose the one providing the most advantageous package.

  • The arrangement guaranteed $8 million for each of the top two lots with an upside split: any amount above $8 million would be divided so the client received 75%.
  • The auction house also eliminated seller’s fees on the remaining lots, while also providing an additional 8% of the hammer price (known as an “enhanced hammer”) for our client.
  • It also was agreed that the auction house would strategically market the collection with videos, a special catalogue, a dedicated sale landing page, and a special tour of the works in Paris and San Francisco.

RESULTS

By working with his U.S. Trust® private client advisor and a team of art specialists, our client:

  • Took advantage of U.S. Trust’s relationships with auction houses to secure a favorable contract from an auction leader.
  • Saved significantly on fees as compared to going directly to an auction house.
  • Connected with an audience of buyers who appreciated the collection, which may have led to overall higher bids and profits.

BANK OF AMERICA CORPORATION’S COMMITMENT TO THE ARTS 

Bank of America Corporation’s Arts & Culture program reflects its belief that the arts matter. Bank of America Corporation supports nonprofit arts institutions globally that deliver visual and performing arts, educate and inspire, anchor communities, create jobs, and sustain local businesses.

Through its Art in Our Communities® program, Bank of America Corporation has lent more than 100 full exhibitions to nonprofit museums throughout the world at no cost. Museums in 28 countries have preserved nearly a hundred works of historic and cultural significance through Bank of America Corporation’s Art Conservation Project. For individual patrons, our Museums on Us® program has let millions of people enjoy no-cost admission to popular cultural institutions.

Learn more about our commitment to the arts at bankofamerica.com/arts.

MANAGING YOUR WORTH WITH U.S. TRUST

Your wealth is not measured by numbers alone, but by the extraordinary opportunities and complex challenges that define your life. At U.S. Trust, we apply our deep insight and broad expertise to help you make the most of the things that matter most to you.

We begin by listening to you, learning about your life, and we work with you to understand your priorities. Your advisor and your team of specialists then build a wealth plan that aligns with your personal values and family goals.

Whether we are managing your portfolio, serving as trustee, or administering an estate, our focus is what best meets your objectives. Together, we develop personalized solutions that address the dimensions of your worth today and the legacy you’re building for future generations.

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