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Since the founding of Bespoke, we have found success in refining unique, customized experiences for the members of our community, constantly challenging the status quo with continuous innovation. In that spirit, we are excited to bring to you Bespoke Luxury Magazine: The Prosperity Report, where we delve into the meaningful insight behind those industries which inspire our niche community’s work and lifestyle.
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EXECUTIVE SUMMARY
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T HE PROSPERITY MARKET
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DIAMOND DEMAND
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DRIVING A NEW COURSE
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TA K I N G O F F P R I VAT E
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IN THE FAST LANE
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C U R AT I N G A N E W L E G AC Y
T H E S Y M B O L T H AT REDEFINED AN INDUSTRY
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EXECUTIVE SUMMARY
As we set our sights towards a summer of long-awaited gatherings and springing markets, it feels the world is shaping into a likeness we once knew. Under the surface it is different, though, because after a year of challenge, necessity is the mother of invention, and invention the mother of change. The events of the last year indeed sparked profound change in major industries, particularly ultra-luxury ones, inevitably shaping the future of global business. As purveyors of acute insight into the world of ultra-luxury, we at Bespoke aim to capture that future with this special edition magazine, The Prosperity Report, a data-driven dive into the major influences on today’s business of luxury. Compiling insight and perspectives from trailblazers in real estate, diamonds, golf, collector cars, private aviation, and fine art, The Prosperity Report highlights what shape each market will take in the coming years, and what catalysts, amid Covid-19, helped sculpt that future. We trace how these key markets reacted, pivoted, and grew in the face of challenge, and what innovations and abundance we can expect for the future. Erwan Rambourg, author of best seller Future Luxe, told us so poignantly: “People will be buying less, but buying better, more iconic investments. Ultimately, luxury reflects the cultural zeitgeist of the moment.” At Bespoke Luxury Magazine, we ardently tap into and make meaning of that zeitgeist, and are honored to take part in exploring it with our greater community. Join us.
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VOICES
ERWAN RAMBOURG
LUXURY EXPERT & AUTHOR OF FUTURE LUXE
REES JONES
F O U N D E R & P R E S I D E N T, REES JONES, INC.
JAY K A R E N ZACHARY VICHINSKY CEO & FOUNDING PA R T N E R , B E S P O K E
C E O , N AT I O N A L G O L F C O U R S E O W N E R S A S S O C I AT I O N
DAVID PILLSBURY CODY VICHINSKY
CEO, CLUBCORP
PRESIDENT & FOUNDING PA R T N E R , B E S P O K E
ANDRE KIKOSKI
F O U N D I N G P R I N C I PA L , A N D R E K I KO S K I A R C H I T E C T
ANDREW SHEINMAN
P R E S I D E N T, P E M B R O O K E & I V E S
M AT T E O AT T I
E V P O F M A R K E T I N G & I N N O VAT I O N , V I S TA J E T
ALEXIS FECTEAU
GLOBAL DIRECTOR OF MARKETING, BOEING BUSINESS JETS
EDMUND HOLLANDER
P R E S I D E N T, H O L L A N D E R D E S I G N LANDSCAPE ARCHITECTS
JOHN KRAMAN
CAROLINE SCHEUFELE
DAVID GOODING
R AY M O N D S A N C R O F T- B A K E R
SANDRA BUTTON
CO-PRESIDENT & ARTISTIC D I R E C T O R , C H O PA R D
J E W E L R Y C O N S U LT A N T, THE FINE ART GROUP
ROBERT CORNFIELD & JOSHUA ALLEN P R I N C I PA L S , F A B R I K A N T
MARC HRUSCHKA
PRESIDENT & CEO, GRAFF USA
D I R E C T O R O F C O M PA N Y R E L AT I O N S , MECUM AUCTIONS
F O U N D E R & P R E S I D E N T, G O O D I N G & C O M PA N Y
CHAIRMAN, PEBBLE BEACH CONCOURS D’ELEGANCE
DUSTYN KIM
CHIEF REVENUE OFFICER, ARTSY
M A R I YA G O L O V I N A
DIRECTOR OF ACQUISITIONS, MASTERWORKS
PAU L Z I M N I S K Y
P R I N C I PA L , PA U L Z I M N I S K Y D I A M O N D A N A LY T I C S
SIMON DE PURY
A R T A U C T I O N E E R , D E A L E R & C U R AT O R
THE PROSPERITY MARKET
INSIGHT INTO THE U LT R A - L U X U R Y M A R K E T O F R E A L E S TAT E
BESPOKE LUXURY MAGAZINE
With new migrations and lifestyles, the national real estate market is more dynamic than ever.
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THE PROSPERITY REPORT | VOL 2
115 Beach Lane, Wainscott, NY.
Oceanfront | 2.55 Acres | 11,000 SF+/BespokeRealEstate.com – $49,500,000
29
The Bristol, Palm Beach, FL.
BESPOKE LUXURY MAGAZINE
Waterfront | 10,350 SF+/7 Beds | 9F/2H Baths BespokeRealEstate.com $29,450,000
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U N I T E D S T A T E S U LT R A - L U X U R Y R E A L E S T A T E
NATIONAL MARKET REPORT “The Hamptons doesn’t have a season anymore, and I don’t believe that will change any time soon,” says Cody Vichinsky, President and Founding Partner of Bespoke. “We are seeing secondary home upgrades, full time residents, and new purchases at higher rates than ever. Coming off an already successful Q4 of 2019, Covid really compounded the success of the market. It’s all really fluid.” Still, he maintains: “New York City is not over.”
This bullish climate was largely led by vacation or secondary-home markets like the Hamptons, South Florida, and Colorado, each breaking records for total sales volume and quantity. However, new residents in those markets meant lost trades for more urban markets, particularly New York City, which saw a sharp 58% decline in ultra-luxury sales.
“The same is true for Florida,” says Zachary Vichinsky, the CEO and Founding Partner of Bespoke. Having moved to service the influx of new $10 million+ property buyers there, he believes that “recent events have shown us that a life outside of buzzing urban areas is viable.” The demand for full time residence in South Florida, he says, is due to the region being both a climate and tax haven.
This reversal signals the most glaring trend of 2020: facing quarantine and lockdowns, many New York City residents flocked to areas with more open space and warm weather, ideal for outdoor and socially distant, safe activities. Rather than upgrading their primary residence in the city or its immediate surroundings, many chose to purchase a secondary home in the Hamptons or Florida, some even declaring it their primary residence, attracted by open space, and in the case of Florida, more favorable tax rates and warmer weather year-round.
THE PROSPERITY REPORT | VOL 2
In 2020, the U.S.’s overall ultra-luxury real estate market soared, despite discrepancies for individual markets. Between record-low interest rates and Covid-19, many people either purchased new secondary homes, outfitted vacation-homes to accommodate year-round living, or in many cases, fully relocated. This shifting resulted in unprecedented rates of moving, investing, and ultimately, an overall prosperous U.S. real estate market.
As we cover each ultra-luxury market in the following pages, we benchmark different cities based on population, demand, and inventory, with starting prices ranging from $7 million to $10 million.
Join us as we break down the top ultra-luxury markets in the country, top trades, and top trends.
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I N S I G H T I N T O T H E U LT R A - L U X U R Y R E A L E S T A T E M A R K E T
HAMPTONS MARKET REPORT
BESPOKE LUXURY MAGAZINE
151
TOTA L $ 1 0 M + S A L E S 2019 - 2020
58 SALES IN 2019
As a primary locale for vacation homes, the Hamptons market has seen unprecedented trade volume in 2020, and is continuing to thrive in 2021.
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93 SALES IN 2020 ↑60.3%
Even before 2020, property sales volume in the Hamptons had been steadily on the rise, due to low interest rates and a generally improved economy. By the fourth quarter of 2019, that slow rise culminated in the highest quarterly trade volume in nearly a decade. An already
improved market, coupled with a rush of individuals looking for a permanent residence outside of New York City in 2020, resulted in a 60.3% sales quantity increase, and an 83.3% sales volume increase.
2 0 2 0 $ 1 0 M + TOTA L S A L E S BY LO C AT I O N
The data shown below includes the top 6 performing locations of the 11 total locations surveyed within the Hamptons $10M+ real estate market in 2020.
11
EAST HAMPTON
SAGAPONACK
+8 SALES FROM 2019
NO CHANGE FROM 2019
27
12
SOUTHAMPTON
BRIDGEHAMPTON
+14 SALES FROM 2019
+2 SALES FROM 2019
6
6
WAT E R M I L L
WAINSCOTT
+2 SALES FROM 2019
+4 SALES FROM 2019
THE PROSPERITY REPORT | VOL 2
17
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BESPOKE LUXURY MAGAZINE
The number of turnkey property trades more than doubled between 2019 and 2020, growing 147%.
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This is best reflected in the sharp surge of turnkey Hamptons properties sold in 2020. From 2015 to 2019, newly renovated properties made up an average of 27% of all trades, performing at nearly the same rates as new construction trades and at about half the
number of land or teardown properties. Yet in 2020, turnkey properties constituted 51% of all trades, double that of both new construction and land/teardowns the previous year. This marked a 147% jump from 2019, from 19 trades to 47.
THE PROSPERITY REPORT | VOL 2
Burnt Point, Wainscott, NY.
Waterfront | 25 Acres | 25,000 SF+/#1 Hamptons Waterfront Sale Sold by BespokeRealEstate.com Q1 2021 LP – $56,000,000
Jule Pond, Water Mill, NY.
Oceanfront | 42 Acres | 20,000 SF+/#1 Hamptons Single Property Sale Sold by BespokeRealEstate.com Q1 2021 LP – $145,000,000
“This shift is because the majority of turnkey properties sold in 2020 fell in the $10 to $20 million range, lower hanging fruit when put into context of the whole ultra-luxury Hamptons market,” explains Joe DeSane, Managing Director of Bespoke in the Hamptons. Trades in Q1 2021 indicate a return to the vintage distribution before 2020, with 7 turnkey sales and 6 land and teardown sales.
Interestingly, while the $20 to $40 million range homes across all types performed the same as years prior, there was a 300% surge in trades in the $40 million+ range, from 3 trades in 2019 to 9 in 2020. As owners of several legacy and iconic properties anticipated the market’s falling interest rates and recognized a growing list of captivated buyers, 2020 proved itself an optimal year to sell.
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NEW YORK CITY MARKET REPORT
BESPOKE LUXURY MAGAZINE
398
TOTA L $ 1 0 M + S A L E S 2019 - 2020
261 SALES IN 2019
Manhattan $10M+ trades declined 47.5% in 2020 compared to 2019, an inverse of the Hamptons market.
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137 SALES IN 2020 ↓ 4 7. 5 %
Manhattan was one of the only ultra-luxury markets in the country that dropped in 2020, by 47.5% in sales quantity, 53.6% in sales volume, and 11.1% in average sale price, across all neighborhoods, locations, and nearly all price segments. The sudden ubiquity
of remote work and the increasing desire for outdoor, socially-distant activities are the primary causes for the rapid relocation of the ultra-high-networth community to secondary vacation markets, including the Hamptons, South Florida, Connecticut, and Colorado.
2 0 2 0 $ 1 0 M + TOTA L S A L E S BY LO C AT I O N
The data shown below includes all locations surveyed within the Manhattan $10M+ real estate market in 2020.
26
DOWNTOWN EAST
MIDTOWN WEST
-7 SALES FROM 2019
-26 SALES FROM 2019
52
28
DOWNTOWN WEST
UPPER EAST SIDE
-28 SALES FROM 2019
-36 SALES FROM 2019
9
12
MIDTOWN EAST
UPPER WEST SIDE
-10 SALES FROM 2019
-17 SALES FROM 2019
THE PROSPERITY REPORT | VOL 2
10
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BESPOKE LUXURY MAGAZINE
Midtown West had double the average sales price of other neighborhoods at $34.2M, a direct effect of increasing development.
The ten most expensive 2020 trades in Manhattan all occurred in the same building on Park Avenue South, between $53.6 and $99 million, each to anonymous buyers. While all ten units went into contract before 2020—some as early as 2015—the fact that the trades were finalized, if not expedited, in 2020 is notable. Of the remaining $10 million+ trades in Manhattan, the majority occurred in
38
THE PROSPERITY REPORT | VOL 2
24 Leonard Street PH, Tribeca, NY.
Custom Triplex Penthouse | 7,261 SF+/BespokeRealEstate.com – $35,950,000
Downtown West, which had the lowest average sales price, indicating that the majority of trades occurred in the $10 to $15 million range. Despite having the lowest sales quantity, Midtown West was the area which held the highest average sale price—about double that of all other neighborhoods— in 2019 and 2020 trades. Kristen Lukic, New York City Portfolio Manager at Bespoke, explains, “this is a direct
effect of increasing development and revitalization of residential property in the neighborhood, first initiated by the opening of Hudson Yards in March 2019.” She continues, “the city is definitely not dead. I believe in regeneration, and we’re starting to see signs of an upturned demand in NYC markets for the coming year.”
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I N S I G H T I N T O T H E U LT R A - L U X U R Y R E A L E S T A T E M A R K E T
CALIFORNIA MARKET REPORT
BESPOKE LUXURY MAGAZINE
387
TOTA L $ 1 0 M + S A L E S 2019 - 2020
110 SALES IN 2019
In California, nearly half of all $10M+ trades in 2020 were concentrated in one county: Los Angeles.
277 SALES IN 2020 ↑151.8%
In 2020, California proved itself as the market with the most growth for $10 million+ properties in the United States, with a 151% sales quantity increase, from 110 in 2019 to 277 in 2020. Even before the pandemic, the number of prospective buyers
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in California outnumbered the number of properties available. With the rush of people out of New York City who worked equally between the city and Los Angeles, many found hardly a better time to permanently shift to L.A.—with better weather and more space than New York—than in the last year.
2 0 2 0 $ 1 0 M + TOTA L S A L E S BY LO C AT I O N
The data shown below includes the top 6 performing locations of the 8 total locations surveyed within the California $10M+ real estate market in 2020.
9
S A N M AT E O C O U N T Y
S A N TA C L A R A C O U N T Y
+42 SALES FROM 2019
+8 SALES FROM 2019
126
54
LOS ANGELES COUNTY
ORANGE COUNTY
+73 SALES FROM 2019
+15 SALES FROM 2019
25
8
SAN DIEGO COUNTY
SAN FRANCISCO COUNTY
+20 SALES FROM 2019
+8 SALES FROM 2019
THE PROSPERITY REPORT | VOL 2
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BESPOKE LUXURY MAGAZINE
The number of San Mateo County $10M+ sales grew by 1400% between 2019 and 2020.
Overall, the biggest determining factors for price came down to acreage, house size, and the year the house was built, highly favoring key locations like Beverly Hills and Malibu. A significant majority of the 2020 $10 million+ sales occurred in Los Angeles County, namely Beverly Hills, Malibu, and the city of Los Angeles. The top sale in 2020 was the Jack Warner Estate for $165 million.
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Bel Air Home Designed by Paul McClean, McClean Design. Courtesy Simon Berlyn
THE PROSPERITY REPORT | VOL 2
Los Angeles County is followed by Orange County’s Newport Beach, Laguna Beach, and Corona Del Mar, which collectively made 54 trades with a $15.3 million average price, and San Mateo County, with 45 trades at a $16.3 million average price. Notably, the counties with the greatest growth were San Mateo and San Diego. In 2019, San Mateo had 3 $10 million+ sales; its 45 2020 sales indicated a
1400% increase. San Mateo is in the heart of Silicon Valley and includes San Francisco, which historically had prices per square foot on par with New York City. Unlike New York City, however, San Mateo is spacious and has a mild climate, which, combined with low interest rates, spelled opportunity for ultra-luxury buyers.
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FLORIDA MARKET REPORT
BESPOKE LUXURY MAGAZINE
279
TOTA L $ 1 0 M + S A L E S 2019 - 2020
82 SALES IN 2019
In 2020, Palm Beach County had 82 $10M+ trades, the same number as the entire state of Florida in 2019.
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197 SALES IN 2020 ↑140.2%
Like other secondary markets, Florida’s staggering increase in sales quantity reflects a major migration to the region, one offering better climate and more space. The entire state of Florida made a total of 279 sales above $10 million in a two-year period, with 82 in 2019 and 197 in 2020. Every county in Florida
with ultra-luxury inventory saw an increase in sales, except Indian River County, which had one sale each year. The counties leading in yearover-year sales quantity growth were Palm Beach at 164% and Miami-Dade at 125%.
2 0 2 0 $ 1 0 M + TOTA L S A L E S BY LO C AT I O N
The data shown below includes the top 6 performing locations of the 7 total locations surveyed within the Florida $10M+ real estate market in 2020.
5
MIAMI-DADE COUNTY
S A R A S OTA C O U N T Y
+45 SALES FROM 2019
+3 SALES FROM 2019
82
7
PA L M B E A C H C O U N T Y
W A LT O N C O U N T Y
+51 SALES FROM 2019
+7 SALES FROM 2019
12
5
BROWARD COUNTY
MARTIN COUNTY
+5 SALES FROM 2019
+5 SALES FROM 2019
THE PROSPERITY REPORT | VOL 2
81
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BESPOKE LUXURY MAGAZINE
Between 2019 and 2020, the number of $10M+ sales grew by 164% in Palm Beach and 125% in Miami.
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It is notable that before 2018, MiamiDade County dominated the ultra-luxury market, yet in the last three years that sensation has shifted to Palm Beach. Bucking its reputation as a place for an older demographic, younger people are steadily moving there, both last year and this year. This is a main contributor to the recent increase in $10 million+ trades, and enabled Palm Beach to take first place in sales volume and average sales price over Miami-Dade County.
Echo Brickell – Apex Penthouse, Miami, FL. 10,100 SF+/- | 5 Beds | 7F/1H Baths BespokeRealEstate.com – $45,000,000
THE PROSPERITY REPORT | VOL 2
This increase also meant that in 2020, Palm Beach County, with 82 $10 million+ trades, had the same number as the entire state of Florida in 2019. “The key cities in Palm Beach County and Miami-Dade possess beaches that are alluring to visitors and prospective home buyers, and subsequently did well during the pandemic,” says Harlan Goldberg, Managing Director of Bespoke’s operations in South Florida.
Before the pandemic, the majority of those who moved from New York City and its surrounding areas to South Florida were either retired or among the few able to work remotely. However, Florida’s milder year-round weather and the convenience of being near a major city, have made the region attractive to young families. What’s more, increasingly favorable tax rates have made the region particularly attractive to ultra-capable buyers looking for a permanent yearround residence.
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COLORADO MARKET REPORT
BESPOKE LUXURY MAGAZINE
324
TOTA L $ 7 M + S A L E S 2019 - 2020
101 SALES IN 2019
72% of all $7M+ trades occurred in Pitkin County, home to Aspen.
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223 SALES IN 2020 ↑ 1 2 0 .7 %
Like many secondary vacation markets, Colorado sales saw an incredible 120% increase of $7 million+ trades between 2019 and 2020. Though Colorado had been predominantly a winter sports destination for West Coast residents, even before the pandemic, Aspen,
Denver, and Vail have become increasingly popular as a yearround vacation destination for East Coasters and West Coasters alike. As such, 160 of the 223 total sales in 2020 occurred in Pitkin County, home to Aspen, culminating in just over $2 billion in residential sales.
2 0 2 0 $ 7 M + TOTA L S A L E S BY LO C AT I O N
The data shown below includes the top 6 performing locations of the 8 total locations surveyed within the Colorado $7M+ real estate market in 2020.
8
EAGLE COUNTY
SAN MIGUEL COUNTY
+4 SALES FROM 2019
+4 SALES FROM 2019
160
3
PITKIN COUNTY
ROUTT COUNTY
+115 SALES FROM 2019
+1 SALE FROM 2019
4
3
BOULDER COUNTY
A R A PA H O E C O U N T Y
NO CHANGE FROM 2019
-2 SALES FROM 2019
THE PROSPERITY REPORT | VOL 2
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BESPOKE LUXURY MAGAZINE
Home in Aspen Designed by Pembrooke & Ives. Courtesy JC Buck
Between 2019 and 2020, the number of $10M+ sales grew by 255% in Pitkin County.
Similarly, 38 transactions occurred in Eagle County, home to Vail, resulting in $439 million total sales volume. Pitkin also earned the spot for the highest average sales price in the $7 million+ range compared to all other Colorado counties, at $13.3 million, and for the greatest growth, at 255%. It is notable that unlike other secondary markets like South Florida and the
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THE PROSPERITY REPORT | VOL 2
Hamptons, which experienced the largest sales transactions during peak summer seasons of Q2 and Q3, most of the uptick in sales in Colorado occurred towards Q3 and Q4, during its peak winter skiing months, where people could safely be outside and use their own gear. Colorado’s hilltops and mountains also makes each home incredibly private and spaced out, ideal for social distancing. With record-high coronavirus cases in California in November and December,
and the state’s subsequent strict lockdowns, many opted to purchase a home toward the end of the year. Additionally, many people who may have had a passing interest in Colorado found last year an ideal opportunity to purchase a luxury home above the value of a typical luxury estate, as Colorado often offers more square footage, upgrades, and amenities per dollar compared to other luxury markets.
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I N S I G H T I N T O T H E U LT R A - L U X U R Y R E A L E S T A T E M A R K E T
CONNECTICUT MARKET REPORT
BESPOKE LUXURY MAGAZINE
71
TOTA L $ 7 M + S A L E S 2019 - 2020
28 SALES IN 2019
The greatest trade in Connecticut was in Greenwich, at 110 Field Point Circle, for $48M.
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43 SALES IN 2020 ↑ 5 3 . 6 %
Connecticut appears to be one of the pandemic’s most prominent beneficiaries, as its already stable real estate market thrived even more, with a 53.6% increase in the quantity of $7 million+ sales in 2020, compared to 2019. Fairfield County, which includes Greenwich, was responsible
for 95% of all $7 million+ real estate transactions in Connecticut in 2019 and 2020 combined, taking 41 of the 43 total sales, with the other two in Litchfield County. This culminated in a $475,437,000 total sales volume for Fairfield County alone.
2 0 2 0 $ 7 M + TOTA L S A L E S BY LO C AT I O N
The data shown below includes all locations surveyed within the Connecticut $7M+ real estate market in 2020.
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FAIRFIELD COUNTY
THE PROSPERITY REPORT | VOL 2
+15 SALES FROM 2019
2
LITCHFIELD COUNTY +2 SALES FROM 2019
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In 2020, the average sales price for Greenwich in the $7M+ segment was $10.8M.
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110 Field Point Circle in Greenwich took the title as the most expensive home sold in Connecticut, for $48 million, more than four times the maximum sale prices for homes in Litchfield County, Middlesex County, and New Haven County. The average sales price in Greenwich alone was $10,810,000.
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Interestingly, this increased trend in a predominantly suburban locale, traditionally home to primary residences, is inconsistent with other primary residential markets in the tri-state area such as New York City and North Jersey. In these markets, many residents choose to purchase a secondary home or even switch their primary residence to South Florida or the Hamptons, rather than upgrading locally.
Fletcher Development Residence - Darien, CT.
Courtesy Fletcher Development
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INSIGHT INTO INTERIORS, ARCHITECTURE, AND LANDSCAPE DESIGN
DESIGN THINKING IN 2021
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Given the shifting lifestyles toward warmer, outdoor spaces, amid significantly more time spent at home, many have reconsidered the dynamic of their living spaces. “From a design point of view, we started seeing the rise of the home as its own sort of mini resort, as its own self-contained entity, with incredible amenities that you would find in a luxury resort,” explains leading New York architect Andre Kikoski, such as an incredible pool deck, dramatic architecture, and transitional outdoor to indoor spaces. For New York City residents moving to Palm Beach, for example, many have taken to artfully retrofitting contemporary design in traditional Palm Beach-style homes, in compliance with the city’s architectural regulations. “Palm Beach used to be very formal, and I think that’s changing a lot,” says Andrew Sheinman, President of renowned interior design firm Pembrooke & Ives. “Now, certainly, there's an influx of much younger people in Palm Beach, and with that has come a much more relaxed atmosphere, which is reflected in the design.”
Additionally, Covid-19 revealed a trend towards transitional spaces. “The spaces that people love to occupy are not necessarily indoors and not necessarily up to full sun,” says celebrated landscape architect Edmund Hollander. “People like being outdoors, where youʼre in a covered space, but open to the fragrance of the garden, where you can hear the birds, you can smell the flowers, yet you’re not being attacked by mosquitos.” The work his firm, Hollander Design Landscape Architects, has prioritized, with both contemporary and traditional architecture, has been responding to demand for such spaces. Transitional spaces also allow for the home to evolve through a lens of “safety and comfort” says Kikoski, allowing it to shift away from a place of statement to one where “you are inspiring your visitors with a place of comfort, health, and wellness.”
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Villa Dol, Pointe Milou St. Barths, F.W.I.
6,452 SF+/- | 5 Beds | 6F/1H Baths BespokeRealEstate.com – $29,950,000
THE PROSPERITY REPORT | VOL 2
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DIAMOND DEMAND
I N S I G H T I N T O T H E U LT R A LUXURY DIAMOND MARKET
With a decreasing natural supply and stronger-thanexpected demand, the rare diamond market is glistening.
Round Brilliant Diamond 12.52 Carats
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I-Color VS11 Ideal Cut
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In March of 2020, diamond mines closed. Unlike closures in other sectors of the luxury economy, however, mine closures gave the diamond market the jolt it needed after years of stagnation. Though sales volume suffered in the immediate aftermath of the pandemic, the demand for rarer and fancy diamonds soared in the following months. As a result, prices have risen dramatically.
the last five years. The pandemic, however, resulted in a 20% larger decrease in 2021 than predicted. Consequently, prices for diamonds above three carats rose approximately 20% between 2019 and 2020. Raymond SancroftBaker, Jewelry Consultant at The Fine Art Group and former European Jewelry Director at Christie’s, says that this decrease in global production caused a disproportional surge in demand specifically for large, colored diamonds, the rarest of all mined diamonds, “of which there are only about ten sold at auction per year.” Notably, this contrasts with the lesser demand for small “commercial” white diamonds, for which consumer purchasing power was more negatively influenced by the pandemic.
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According to the Zimnisky Index, a popular tool used to analyze global diamond prices, formulated each year by industry analyst Paul Zimnisky, global diamond production fell approximately 23% between 2019 and 2021. Before the pandemic, experts had already expected diamond production to decrease between 2021 and 2025, due to oversupply over
Rough Diamond Price Performance by Size Over Past 6 Years 5 - 9 C A R AT
3 - 4 C A R AT
> 1 . 5 C A R AT
120 *Data curated by Paul Zimnisky, Zimnisky Diamond AnalyticsTM.
PRICE INDEX
110
100
90
80
70
Q1
2015
Q2
Q3
Q4
Q1
2016
Q2
Q3
Q4
Q1
2017
Q2
Q3
Q4
Q1
2018
Q2
Q3
Q4
Q1
2019
Q2
Q3
Q4
Q1
2020
Q2
Q3
Q4
2021
The price growth for diamonds above 3 carats is starkly greater than for diamonds below 1.5 carats, signaling a higher demand for large, fancy diamonds over commercial ones.
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INSIGHT
A “red” diamond is simply a brilliant intensification of pinkness.
Purchased for $8,750,360 by Laurence Graff
THE PROSPERITY REPORT | VOL 2
13.33 Carat Rough Pink Diamond
Graff Has Cut and Polished into a 5.63 Carat Fancy Pear-Shape
Graff Lesotho Pink Diamond. Courtesy Graff
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INSIGHT
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The 302 carat Graff Lesedi La Rona, the worldʼs largest square emerald diamond, was 1 of 67 cut from this 1,109 carat rough diamond.
GRAFF LESEDI LA RONA SOLD FOR $53M
Before – 1,109 Carat Rough Diamond.
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As a result of a heightened interest in large, colored diamonds, a 14.83-carat fancy purple-pink diamond, called “Spirit of the Rose,” sold for $26.6 million at auction in November of 2020. This set a record price for a purple-pink gem and ranked it among the most valuable polished diamonds in the world. To be sure, demand for large colored diamonds was not down before the pandemic, per se. Caroline Scheufele, the Co-President & Artistic Director of Chopard, explains that “the increased appearance of important stones that we’ve seen in the last couple of years did not have the adverse effect of lowering value and price, rather it stabilized the market.
Courtesy Graff
T H E L A R G E S T, H I G H E S T C O L O R , HIGHEST CLARITY DIAMOND EVER CERTIFIED BY THE GIA
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Graff Lesedi La Rona Diamond.
In addition to the lower supply of diamonds on the market, consumer behaviors shaped by the pandemic also contributed to demand. Joshua Allen, a Principal at Fabrikant, esteemed New York jewelry house founded in 1895, notes that clients who would have otherwise spent money on luxury travel opted to invest in a timeless jewel instead, with the added benefit of safeguarding against inflation. No good on the planet has a similar value-to-weight ratio as a fancy colored diamond, says Zimnisky, which can reach over $1 million per carat, and which can hold its value indefinitely over time.
After – Graff 302 Carat Square Emerald Cut.
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Graff Tribal Emerald & Diamond Earrings & Necklace. Courtesy Graff
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Emeralds: 60 Carats Diamonds: 9 Carats
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Emeralds: 418 Carats Diamonds: 76 Carats
INSIGHT
Prices for diamonds above three carats rose approximately 20% between 2019 and 2020.
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INSIGHT
Last year, the $26.6M sale of a 14.83 carat stone broke the record for a purple-pink diamond ever sold at auction.
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Fabrikant – Assortment of Diamond Necklaces & Bracelets, 134 Carats Total. Courtesy Bespoke Luxury Marketing
Looking towards the next few years, industry indices predict diamonds will trade for higher prices than they are today, as diamond production is anticipated to continue to decrease at an average rate of 20% until 2025, from 144 million carats produced globally to about 120 million. “As long as the market continues to trend in a positive direction, I believe
we will see more of these everyday diamond purchases,” says Marc Hruschka, the President & CEO of Graff USA. “For many, it’s a way to celebrate leading a more ‘normal’ life then we have in the last year.” Scheufele agrees; one can “put on a most prized piece and simply enjoy its intrinsic beauty,” she says. Maybe that’s the meaning of true luxury.”
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BRILLIANT
PRINCESS
MARQUISE
The most popular—and most expensive—diamonds are round brilliant cuts. They have the most sparkle and brilliance, as the circle shape encourages rays of light to reflect against different facets in the diamond.
A princess diamond combines the best of both worlds: a square-rectangular shape with a brilliant cut. Princess diamonds are popular as they can work in almost any style of ring, so are often used in engagement rings.
Marquise diamonds have a unique shape, often described as lips or eyes. Due to its elongated shape, this cut creates an illusion that the stone is a greater size, while making the finger appear longer and slimmer.
INSIGHT
Elongated cuts make the diamond appear bigger and the finger more slender.
THE PROSPERITY REPORT | VOL 2
CUSHION
OVA L
EMERALD
Combines a square cut with rounded corners, much like a pillow. The cushion cut has been around for almost 200 years, and must be very carefully shaped as minor facets can easily change the stone’s appearance.
A modified brilliant cut, ovals possess a similar fire and brilliance to brilliant cuts, with the added advantage of an elongated shape. A limited supply of beautifully cut ovals has led to a 25 to 30% price increase over the last year.
Emerald diamonds have chiseled step cuts with straight linear facets, producing a hall-ofmirrors effect. Their unique pavilion and large, open table makes them appear larger than a similarly-sized round diamond.
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Fabrikant – Fancy Vivid Yellow – Radiant Cut 10.32 Carat, 1.28 Carat Side Stones. Courtesy Bespoke Luxury Marketing
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INSIGHT Raymond Sancroft-Baker
Jewelry Consultant, The Fine Art Group
“Yellow diamonds derive their color from an overabundance of nitrogen.”
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Chopard Haute Joaillerie Earrings – Two 5 Carat Fancy Vivid Yellow Diamonds, Two 1 Carat White Diamonds in 18k White and Yellow Gold. Courtesy Chopard
Color Colored diamonds, also known as “fancy” diamonds, are those whose natural color range extends out of the D to Z color range used by most gemologists to classify the blue and yellow hues in a classic white diamond. Pink diamonds, the rarest of all colors, get their tint from a “slippage of crystallographic lattice,” explains Raymond-Sancroft-Baker, the Jewelry Consultant at The Fine Art Group and former European Jewelry Director at Christie’s. Pink diamonds are followed in popularity and rarity by yellow diamonds, which retain an over-abundance of nitrogen, and then by blue, which get their color from an increased presence of boron.
Still, fluctuations in each gem vary within a color. More desirable than pink diamonds are “red” diamonds, which are simply a brilliant intensification of pinkness. In the case of blue diamonds, boron itself is rare, which, depending on its deposits in a diamond, can result in Light blue, Fancy blue, Intense blue, or Deep blue. “The best is Vivid blue, which is super rare,” says Sancroft-Baker. “I do have a particular fondness for pink diamonds,” says Caroline Scheufele, the Co-President and Artistic Director of Chopard. “For me, pink diamonds exude a fusion of femininity and boldness.”
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FL
IF
VVS2
Very, very small inclusions
VS1
VS2
Very small inclusions
S1
Clarity Unlike the classic vision of an expert gemologist scrupulously analyzing a diamond under the microscope, clarity is not the greatest determinant of a diamond’s value. In reality, collectors may weigh clarity less than cut or color. Flawless diamonds are stones whose internal lattice structure has no inclusions or irregularities, which appear as small scratches under a 10x microscope. Since inclusions are completely invisible to the naked eye, if one stone has a rare color or brilliant cut, most often it can be appraised at a higher rate.
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S2
Small inclusions
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Flawless
VVS1
I1
I2 Inclusions
I3
THE PROSPERITY REPORT | VOL 2
INSIGHT Robert Cornfield
Principal, Fabrikant
“The average price per diamond increases about 10-15% with each upgrade in clarity and color grade.”
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An Elevated Landscape An Elevated Lifestyle
2000 Ocean by Enrique Norten – TEN Arquitectos, a contemporary 38-story glass tower showcasing panoramic views of the Atlantic Ocean, Intracoastal Waterway and surrounding beaches, is located just north of South Floridaʼs Golden Beach. Proudly positioned on the beach, and closer to the ocean than any of its neighbors, it is bathed with sunlight from sunrise to sunset. Sixty-four families will have the privilege to call 2000 Ocean their home. 3-5 bedroom oceanfront residences starting at 2,913 sq. ft., featuring kitchens by Boffi and interior design services by Minotti. Concept design by Kobi Karp. Priced at $2.7M - Delivering Summer 2021.
For inquiries, or to schedule a private preview of 2000 Ocean at our on-site sales gallery, please calll 786.245.5453 or visit 2000ocean.com.
Connect with Bespoke at our Newest Destination in Miami
119 Washington Ave, Suite 500, Miami Beach, FL 33139-7228 | 305.800.9030
B E S P O K E R E A L E S TAT E . C O M
© 2021 Bespoke Real Estate LLC (“Bespoke”), a licensed Real Estate Broker. All rights reserved. All transactional data and statistics are powered by Bespoke Luxury Market Data. All creative content is powered by Bespoke Luxury Marketing LLC. Bespoke fully supports and complies with the Fair Housing Act, Equal Housing Opportunity Act and related state and local laws that prohibit discrimination.
Unlock Your Access Bespoke invites you to access our compelling data-driven platform for precisely pairing the world’s finest properties with their most qualified audience; benefit from the specialized resources of the collective Bespoke brand as we work purposefully on your behalf —Tailored for $10M+. We are grateful to be of value. Over $5Billion in $10Million+ Transactions
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DRIVING A NEW COURSE
INSIGHT INTO THE U LT R A - L U X U R Y M A R K E T OF GOLF
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Offering an ideal setting for outdoor play, golf has grown into one of the most popular sports of the year.
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The Reserve at Moonlight Basin, 5th Hole – Cameron, Montana. Courtesy Evan Schiller Golfshots.com
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THE PROSPERITY REPORT | VOL 2
In 2020, golf had a renaissance. Offering an ideal setting for outdoor play, the sport grew profoundly, breaking decade-old records. There was a 13.9% increase in the number of rounds played compared to the previous year, the highest increase in 23 years, from 441 million to 502 million rounds. Equipment sales grew by 10.1%, reaching $28 billion nationally. The number of new golfers flourished,
particularly among new demographics, with increased interest among women and younger players.
Punta Espada Golf Club 2nd & 12th Holes – Dominican Republic. Courtesy Evan Schiller
Unlike most contact sports, golf provides an outdoor and socially distanced environment, making it attractive to those who prioritize being active and social despite a pandemic. Additionally, remote work allowed for greater schedule flexibility and more time for recreation.
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Mauna Kea Golf Course, 11th Hole – Waimea, Hawaii – Designed by Rees Jones. Courtesy Larry Lambrecht
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INSIGHT The National Golf Performance Report Golf Datatech
Golf equipment sales reached $2.8B in 2020, a 10.1% increase compared to 2019.
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Notably, golf has been taken up at an astonishing rate by younger players. The National Golf Foundation estimates 630,000 players under the age of 18 played golf for the first time in the last twelve months. David Pillsbury, the CEO of ClubCorp, the largest owner and operator of private clubs in the country, says that even among slightly older groups, 47% of all new players were between the ages of 30 and 50.
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According to Jay Karen, the CEO of the National Golf Course Owners Association, or the NGCOA, the latent demand of golf players, defined as those who demonstrate
interest but have yet to play, has also skewed younger. This is one of the most important metrics in the industry. W H AT I N N O VAT I O N M E A N S FOR GOLF
To accommodate the new influx of players, innovation in golf course architecture and technology has been a huge focus for Rees Jones, renowned course architect, and the designer of The Atlantic Golf Club and The Bridge in Bridgehampton. One of his recent priorities has been innovating drainage systems to ensure a course’s longevity and efficiency.
Rounds of Golf Played Annually Over Past 5 Years
# O F R O U N D S P L AY E D ( I N M I L L I O N S )
500
500M
480
460
469M
456M
440
441M
425M
420
400 2016
2017
2018
*Data curated by National Golf Foundation and Golf Datatech.
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2019
2020
INSIGHT The Graffis Report
National Golf Foundation
In 2020, there were 13.9% more rounds of golf played than in 2019. Among private clubs, it was a 19.9% increase.
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Nantucket Golf Club – Siasconset, MA Designed by Rees Jones. Courtesy Larry Lambrecht
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California Golf Club, 3rd Hole – San Francisco, California. Courtesy Evan Schiller
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INSIGHT The Graffis Report
National Golf Foundation
There were an estimated 500M rounds of golf played in 2020.
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When luxury clubs, homes, and communities are built around golf courses, Jones explains, their accompanying watershed areas bring more water to the courses and make them prone to flooding. To accommodate these increased drainage loads, new and remodeled courses feature technologically improved drainage systems.
Andalusia Golf Course, 4th Hole – La Quinta, California Courtesy Rees Jones
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For example, Jones’ courses place new liner technology in sand bunkers, to prevent sand erosion and contamination. This both preserves functional drainage and extends the life of the sand. Additionally, Jones is designing courses to meet the needs of an evolving player demographic. According to the USGA,
the average driving distance increased 16 yards since 1997, making courses shorter and less challenging for highly skilled players. In order to accommodate people of all ages and abilities, including beginners, Jones creates multiple tees, which provide different angles of play and levels of challenge on the same hole.
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Pebble Beach Golf Links 7th Hole – Pebble Beach, California. Courtesy Evan Schiller
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INSIGHT The Graffis Report
National Golf Foundation
630,000 players under the age of 18 took up golf for the first time in the last twelve months.
As far as making the play itself more efficient, Karen predicts advanced gaming technologies will infiltrate the golf world. This will allow players to track strokes, birdies, or putts, and will enable more complex and gamified betting systems. The PGA ShotLink system, which captures and reports insight about every shot in real-time, is used at about 93 professional events per year, suggesting similar technology will become mainstream on recreational courses.
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If a course offers only limited tee options, “it makes it difficult for the shorter hitter or beginner to play the course.” By creating multiple tees, “the course is more playable for every caliber of player,” including different golf handicaps and seniors. “We really have to rethink our designs,” he concluded.
Top courses across the country such as BallenIsles in Florida, Pebble Beach in California, and the Hamptonsʼ Shinnecock Hills or National Golf Links of America in New York, are accommodating these new architectural and technological efficiencies. With more players outside than ever, they must be, creating a new future for a classic game.
Redstick Golf Club 9th & 18th Holes – Vero Beach, FL – Designed by Rees Jones. Courtesy Jeffrey Bertch
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Sebonack Golf Course, 2nd Hole – Southampton, NY. Courtesy Larry Lambrech
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Iconic Architecture + Interior Design
AKARCH.COM
Tw o We s t Wa t e r , S a g H a r b o r
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TAKING OFF PRIVATE
INSIGHT INTO THE U LT R A - L U X U R Y M A R K E T O F P R I VAT E AV I AT I O N
Offering a safe haven in the skies, the private aviation market is rising to new heights.
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Bombardier Challenger 350. Courtesy Sandro Koster
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INSIGHT Air Charter Services Market Analysis Technavio
Despite a 55% plunge in commercial travel, the air charter services market grew 4.52%, from $26.6B in 2019 to $27.8B in 2020. 106
Soaring through the sky on a private flight has often spelled comfort, convenience, and ease. Over the last twelve months, it has also provided another more critical offer: health and safety. As a result, the market for private aviation is prospering. During a year that witnessed a 55% plunge in commercial travel, the air charter services market grew 4.52%, from $26.6 billion in 2019 to $27.8 billion in 2020, according to
THE PROSPERITY REPORT | VOL 2
a market report by business research firm Technavio. Market growth is expected to continually increase over the next three years, reaching a market value of $33 billion, at a CAGR of 5%. Likewise, rates of new travelers taking to private aviation more than tripled last year, marked by a 320% increase in inquiries for new memberships with top private charter services since July 2020.
Boeing Business Jets (BBJ). Courtesy Sandro Koster
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In a pandemic world, the primary reason for this growth is intuitive: private flight is innately more hygienic and thus safer. According to a recent McKinsey analysis, private jets have only 20 to 30 touchpoints of contact with other people and objects, while the average commercial flight risks about 700 points of contact. Private passengers typically encounter a mere 8 people door-to-door, compared to 600 for a standard commercial passenger and 136 for a business class passenger.
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Alexis Fecteau, the Global Director of Marketing at Boeing Business Jets, explains, “while commercial airline staff and private jet staff maintain sanitization as a top priority, and while both meticulously clean cabins between flights, private jets have fewer passengers, which streamlines and simplifies the process.” Private flyers also see this reduced number of passengers they can potentially come into contact with as a benefit to private flying.
Boeing Business Jets (BBJ).
Courtesy Boeing
Conceptual Design.
Courtesy Jet Aviation
“Before the pandemic, only 10% of people who could afford to fly private did,” says Matteo Atti, the Executive Vice President of Marketing and Innovation at VistaJet, a global private aviation company. He explains that private airline providers are able to take dramatically better safety precautions, resulting in stable consumer demand even after moments of initial panic subsided. “While standard passengers haven’t all switched over to private, former business class flyers in particular have digressed,” opting instead for private travel, says Atti. Recreational flyers have contributed to the surge as well, many of whom were bound to take strict health precautions yet were especially motivated to travel in the face of lockdowns.
INSIGHT
McKinsey & Company
Private flights have only 20-30 points of contact with other people and objects. The average commercial flight has about 700.
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Gulfstream 650.
Courtesy Sandro Koster
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Top 10 Most Traveled U.S. Private Jet Airport Routes in 2020
YOY % INCREASE
ROUTE
↑467%
PALM BEACH, FL
WESTCHESTER COUNTY, NY
KPBI ▶ KHPN
↑457%
BOCA RATON, FL
FARMINGDALE, NY
KBCT ▶ KFRG
↑392%
PALM BEACH, FL
WESTHAMPTON BEACH, NY
KPBI ▶ KFOK
↑357%
VAN NUYS, LOS ANGELES, CA
↑275%
PALM BEACH, FL
LAURENCE HANSON AIRPORT, BOSTON, MA
KPBI ▶ KBED
↑231%
PALM BEACH, FL
FARMINGDALE, NY
KPBI ▶ KFRG
↑219%
WESTCHESTER COUNTY, NY
↑141%
BROWNSVILLE, TX
↑131%
HOUSTON, TX
↑131%
MIAMI OPA-LOCKA AIRPORT, FL
AIRPORT PA I R
ASPEN-PITKIN COUNTY, CO
PALM BEACH, FL
MONTERREY, MX
ASPEN-PITKIN COUNTY, CO
LA ISABELA, DOM
*Data curated by WingX.
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KVNY ▶ KASE
KHPN ▶ KPBI
KBRO ▶ MMAN
KHOU ▶ KASE
KOPF ▶ MDJB
INSIGHT
6 of the top 10 routes with the most growth were between New York and South Florida.
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Global 7500.
Courtesy VistaJet
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INSIGHT Matteo Atti
EVP of Marketing & Innovation, VistaJet
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“Private aviation is a highly fragmented market, with the top players only accounting for 10% of it.”
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According to an analysis of private flights between 2019 and 2020, 5 of the top ten routes with the most yearover-year growth were all between South Florida and New York; from the Hamptons, Westchester or North Jersey to Palm Beach or Boca Raton. The greatest growing route, between Palm Beach International Airport and Westchester County Airport, increased 467% between 2019 and 2020.
Looking optimistically to the future, experts predict the market will consolidate, driven not only by demands for top health safety, but also by accident prevention. Today, about 80% of the market is made up of small charter companies. In Europe particularly, this fragmentation has led to the rise of “gray” charter airlines, or airlines flying passengers out of the scope of government regulators and routine safety inspections.
Global 7500.
Courtesy VistaJet
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INSIGHT
WingX
BESPOKE LUXURY MAGAZINE
The number of private flights between Palm Beach and Westchester County grew 467% between 2019 and 2020.
Global 7500.
Courtesy VistaJet
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Top 10 Most Traveled U.S. Airports via Private Plane in 2020
AIRPORT
CITY
36,508
TETERBORO AIRPORT
BERGEN COUNTY, NJ
29,809
DALLAS LOVE FIELD AIRPORT
DALLAS, TX
2 7,7 8 1
PALM BEACH INTERNATIONAL AIRPORT
PALM BEACH, FL
2 4 ,7 3 9
VAN NUYS AIRPORT
LOS ANGELES, CA
24,243
CENTENNIAL AIRPORT
DENVER, CO
21,859
WESTCHESTER COUNTY AIRPORT
WHITE PLAINS, NY
2 1 ,7 9 4
SCOTTSDALE AIRPORT
SCOTTSDALE, AZ
20,539
DEKALB-PEACHTREE AIRPORT
ATLANTA, GA
2 0 ,1 4 5
WILLIAM P. HOBBY AIRPORT
HOUSTON, TX
18,910
NAPLES AIRPORT
NAPLES, FL
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# OF FLIGHTS
*Data curated by WingX.
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Global 6500.
Courtesy Bombardier
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INSIGHT Matteo Atti
EVP of Marketing & Innovation, VistaJet
“VistaJet saw a 29% increase in new subscription memberships between 2019 and 2020.”
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Four Seasons Private Jet.
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Courtesy Four Seasons
Historically, private aviation has had higher per capita accident rate because of this laissez-faire nature of the industry. As a result, private flyers increasingly are demanding more accountability from private airlines to uphold safety regulations, which larger providers can more reliably guarantee. The consolidation of small charter companies into larger full-service providers, such as VistaJet, will mean less small charter
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companies flying under the radar, as it were, and therefore safer rides. Additionally, as a marketing strategy to ensure that people continue flying private after the pandemic, airlines have built out product offerings in the form of partnerships with related but distinct hospitality vendors that provide door-to-door luxury experiences. According to a study by Barton Consulting and VistaJet surveying luxury hospitality
THE PROSPERITY REPORT | VOL 2
brands, around 80% of businesses believe that an enhanced “ecosystem” of partnerships across the travel sector will improve their resilience. A primary example of this ecosystem is the Four Seasons Private Jet Experience, whose 2022 itinerary will include private ultra-luxury tours across Africa and Southeast Asia. With a soaring demand for holistic experiences, the demand for end-to-end providers is likewise taking off.
INSIGHT Air Charter Services Market Analysis Technavio
The global air charter service market is expected to surpass $33B by 2024, at a 5% CAGR.
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INSIGHT INTO THE U LT R A - L U X U R Y M A R K E T OF COLLECTOR CARS
BESPOKE LUXURY MAGAZINE
A dynamic collector car market is racing toward unprecedented sales, broken records, and better technology.
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Original Porsche 550 Spyders. Courtesy Stephan Bauer
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INSIGHT
This 1934 Bugatti, Type 59 Sports, was the most expensive car sold at auction in 2020 for £9.5M.
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Collector cars have always set the standard for driving in the luxury lane, especially in 2020, when the open road provided a much-needed taste of freedom. Last September, the $12.6 million sale of the 1934 Bugatti, Type 59 Sports, formerly a Works Grand Prix in 193435 and once owned by King Leopold III of Belgium, became the most expensive
THE PROSPERITY REPORT | VOL 2
single collector car trade in 2020. It sold at the Passion of a Lifetime auction hosted by leading automotive auctioneer Gooding & Company, at the Hampton Court Palace in London. Despite the auction's online bidding and social distancing, Passion of a Lifetime had $47 million in total sales and a $3.2 million average sale price, breaking the record for the highest average sale per car at a single public auction.
#1 SALE IN 2020
1934 Bugatti Type 59 Sports. Sold: £9,535,000
≈ $12,661,526 Courtesy Gooding & Company and Mathieu Heurtault
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This auction is among the many highlights in the collector car industry’s year. Gooding & Co.’s five car auctions since January 2020—three of which were online only—collectively fetched $144 million in total, with an average sale price of $767,371 and 91% sellthrough rate. Similarly, Mecum Auctions, the largest auction house in volume for ultra-luxury
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collector cars, is riding on an 80% sellthrough rate from its 2020 auctions, three of which were exclusively online. Coming off a strong year, their recent January 2021 auction grossed $110 million in sales volume, breaking their own previously-held volume record by 15%. The top single sale at this 2021 auction was Caroll Shelby's 1965 Shelby 427 Cobra Roadster, for $5.94 million.
#3 SALE IN 2021 YTD
Carroll Shelby's Personal 1965 427 Cobra Roadster. One of Only Five 427 Cobras, Originally Finished in Charcoal Gray. Original body and chassis.
Sold: $5,940,000 Courtesy of Mecum Auctions, Inc.
THE PROSPERITY REPORT | VOL 2
INSIGHT
This 1965 427 Cobra Roadster was one of Caroll Shelbyʼs personal cars for over 50 years.
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INSIGHT
The top five trades in 2020 were all from the same manufacturer and the same era: 1920s-‘30s Ettore-era racing Bugattis.
“In this market,” says David Gooding, Gooding & Co.ʼs Founder and President, “we are observing a greater divide between good, better, and best, and clients are increasingly selective with their purchases.” In large part, that is due to the increasing free time the pandemic afforded to everyone, as well as travel limits and canceled vacations that encouraged collectors to turn their attention to at-home luxuries.
THE PROSPERITY REPORT | VOL 2
LOCAL LUXURIES
The advent of efficient online bidding has been another major factor driving sales during 2020, says John Kraman, the Director of Company Relations at Mecum Auctions. Auction houses that quickly adapted to seamless online bidding experiences have seen outsized success compared to those that did not. For Mecum, online and absentee participation constituted 3 to 5% of all bidding before the pandemic; by January 2021, online bidders made up 30% of all trades.
#2 SALE IN 2020
1937 Bugatti Type 57S Atalante. Sold: £7,855,000 ≈ $10,430,654 Courtesy Gooding & Company and Mathieu Heurtault
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INSIGHT
BESPOKE LUXURY MAGAZINE
This 1932 vehicle is 1 of 14 Super Sports including the coachwork of Jean Bugatti, the son of Ettore, the founder.
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#3 SALE IN 2020
1932 Bugatti Type 55 Super Sport Roadster. Sold: $7,100,000 Courtesy Bonhams
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INSIGHT John Kraman
Director of Company Relations, Mecum Auctions
“Popular among younger buyers are Resto-Mods, or vintage cars updated with modern mechanicals.” 136
G E N E R AT I O N A L TA S T E S D I V E R G E
Notably, Gen X and millennial buyers are also participating in the market at higher rates. Unlike Boomer “nostalgia” buyers who remember mid-20th century cars as new models, the younger “legacy” collectors fantasize about “stories and the hype, the television shows and the styling of the cars,” says Kraman. Most popular
THE PROSPERITY REPORT | VOL 2
in this group is a Resto Mod, or a vintage car updated with all modern mechanicals. John Wiley, a senior analyst at Hagerty’s Automotive Intelligence Group, says that in the Porsche market, Baby Boomers tend to favor air-cooled, long-hooded models, whereas Millennials opt for “newer, watercooled cars—namely 997 and 991—but also show plenty of interest in the aircooled 911 of their youth, the 993.
Original Porsche 550 Spyders. Courtesy Stephan Bauer
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INSIGHT
Debuted in the 1932 Le Mans 24-Hour Race, this vehicle was later rebodied by Italian coachbuilder Figoni. 138
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#5 SALE IN 2020
1931 Bugatti Type 55 Two-Seat Supersport. Sold: £4,600,000 ≈ $5,543,460 Courtesy Bonhams
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Aston Martinʼs DB3S set a new Australian land speed record in 1957 at 143.19 MPH.
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Sandra Button, the Chairman of Pebble Beach Concours d’Elegance, one of the most prestigious collector car shows in the U.S., adds that, “authenticity, whether in a preservation or a restored car, is increasingly important. Collectors want cars that are true to themselves and true to their
era.” She adds that there is a shift toward favoring newer cars as well. “Tastes have shifted away from the more formal, chauffeured cars that won Concours in decades past,” she says. Small cars can be elegant, “as long as the designer practices restraint. On a small car, thereʼs no room for error.”
INSIGHT Sandra Button
#8 SALE IN 2020
1955 Aston Martin DB3S. One of Only 20 Customer DB3S Examples Built. Raced in Europe and the UK as Part of David McKay and Tony Gaze’s Kangaroo Stable. Sold: £3,011,000 ≈ $3,998,306
Chairman, Pebble Beach Concours d'Elegance
“Environmental converter kits are being made for postwar cars, such as Jaguar E-types and Aston Martins.”
Courtesy Gooding & Company and Mathieu Heurtault
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1966 Ferrari 275 GTB Long Nose.
BESPOKE LUXURY MAGAZINE
Sold in 2020: $3,080,000 Courtesy Gooding & Company and Brian Henniker
H I S TO R I C B U G AT T I S C R O W N 2020 TRADES
While the Bugatti make is among the best in the world, the most expensive collector cars at auction have historically been Ferraris. However, the fact that in an already bullish year, the top five sales at public auction were all from the same manufacturer and the same era—the Ettore and Jean Bugatti era, or 1920s to late 1930s racing Bugattis—suggests
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that collectors are prizing the marque’s longevity of performance. 2020 was the first time that the top five cars sold at auction were made by a single manufacturer. Despite a declining interest in pre-war vehicles, Bugatti is an exception, as their value increases directly with their age. “Every historic Bugatti vehicle is unique,” says Frank Wilke, Managing Director of Classic Analytics. “Those built between 1920
THE PROSPERITY REPORT | VOL 2
and the end of the 1930s set standards in both performance and design. However last year’s auctioned vehicles were particularly outstanding in terms of history and originality,” he says.
INSIGHT
Carrozzeria Scaglietti, the coachwork designer, built just 205 examples of Ferraris with the long nose body style.
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As of mid-April, the top 2021 sales have been cars that date from the late ‘50s to early ‘70s.
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That said, as of mid-April 2021, the top four sold cars date from the late ‘50s to early ‘70s, the top sale being the 1972 Matra MS 670, auctioned by Artcurial auction house, for $8.3 million.
Looking to the future, experts say that the collector car market will accommodate environmental concerns. “Converter kits are being made for some collector cars—primarily post-war cars like Jaguar E-types and Aston Martins,” explains Button.
THE PROSPERITY REPORT | VOL 2
#7 SALE IN 2020
1971 Lamborghini Miura P400 SV Speciale. One of Only 150 SVs Built. 385 BHP at 7,850 RPM. Sold: £3,207,000 ≈ $4,258,575 Courtesy Gooding & Company and Mathieu Heurtault
“But the collectors considering such a conversion usually want assurance that their car can be returned to its original state without any damage.” The infiltration of self-driving technologies are also unlikely, she says. “If you have a collector car, and you want to enjoy it on drives and rallies, then you want to do the driving.”
With this yearʼs upcoming events— from the Goodwood Revival to the Pebble Beach Concours d’Elegance, Amelia Island Concours d’Elegance, and the Villa d’Este Concorso d’Eleganza—time will tell if the same trend materializes throughout the rest of 2021, favoring historic racing as last year, or if a new favorite will win the hearts of collectors. Either way, there’s a promising road ahead.
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1974 Lamborghini Contouch LP400. Courtesy Stephan Bauer
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Top 10 Most-Expensive Cars Sold at Public Auction, 2020
LOT
CAR
PRICE
AUCTION HOUSE
1934 BUGATTI TYPE 59 SPORTS
$12,661,526
GOODING, LONDON
2
1937 BUGATTI TYPE 57S ATALANTE
$10,430,654
GOODING, LONDON
3
1932 BUGATTI TYPE 55 SUPER SPORT ROADSTER
$7,100,000
BONHAMS, AMELIA ISLAND
4
1928 BUGATTI TYPE 35C GRAND PRIX
$5,225,286
GOODING, LONDON
5
1931 BUGATTI TYPE 55 TWO-SEAT SUPERSPORT
$5,543,460
BONHAMS, PARIS
6
2001 FERRARI 550 GT1 PRODRIVE
$4,290,000
RM SOTHEBY'S, SHIFT/MONTEREY
7
1971 LAMBORGHINI MIURA P400 SV SPECIALE
$4,258,575
GOODING, LONDON
8
1955 ASTON MARTIN DB3S
$3,998,306
GOODING, LONDON
9
1965 SHELBY GT350 PROTOTYPE
$3,850,000
MECUM, INDIANAPOLIS
10
1968 FORD MUSTANG GT “BULLIT”
$3,740,000
MECUM, KISSIMMEE
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*Data Curated by Top Classic Car Auctions.
A N N UA L C A R C O L L E C TO R E V E N T S TO AT T E N D, 2 0 2 1
Given last year’s travel and event limitations, we’ve curated the most anticipated events for collector car enthusiasts to attend in 2021.
MILLE MIGLIA (EST. 1927) | JUNE 16-19, 2021 | BRESCIA TO ROME GOODWOOD FESTIVAL OF SPEED (EST. 1993) | JULY 8-11, 2021 | GOODWOOD HOUSE, CHICHESTER, WEST SUSSEX PEBBLE BEACH CONCOURSE D’ELEGANCE (EST. 1950) | AUGUST 15, 2021 | CARMEL, CALIFORNIA GOODWOOD REVIVAL (EST. 1998) | SEPTEMBER 17-19, 2021 | GOODWOOD HOUSE, CHICHESTER, WEST SUSSEX CONCORSO D`ELEGANZA VILLA D´ESTE (EST. 1929) | OCTOBER 1-3, 2021 | VILLA D'ESTE HOTEL, LAKE COMO
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ARRIVING HOME, BEAUTIFULLY.
The Marina at Aston Martin Residences provides a unique and exclusive means of getting to and from the heart of Miami. The ample depth of mooring means even the super yachts can berth on your doorstep. Unparalleled convenience designed for living life beautifully. Riverwalk East Developments, LLC, a Florida limited liability company is the owner of the property on which the Condominium is to be constructed and the seller of the units in the Condominium and is for purposes of the Florida Condominium Act the “developer” of the Condominium (“Developer”). Developer has engaged G & G Business Developments, LLC. (“G & G”) to assist with the development and marketing of the Condominium and its units and Developer has a limited right to use the trademarked names and logos of G & G. Any and all statements, disclosures and/or representations relating to the Condominium shall be deemed made by Developer and not by G & G and you agree to look solely to Developer (and not to G & G and/or any of its affiliates) with respect to any and all matters relating to the development and/or marketing of the Condominium and with respect to the sales of units in the Condominium. All images and designs depicted herein are artist’s conceptual renderings, which are based upon preliminary development plans, and are subject to change without notice in the manner provided in the offering documents. All such materials are not to scale and are shown solely for illustrative purpose. For New York Purchasers only, the complete offering terms also require reference to that certain CPS-12 Application available from the Offeror under file number CP18-0005. ORAL REPRESENTATIONS CANNOT BE RELIED UPON AS CORRECTLY STATING THE REPRESENTATIONS OF THE DEVELOPER. FOR CORRECT REPRESENTATIONS, MAKE REFERENCE TO THIS BROCHURE AND TO THE DOCUMENTS REQUIRED BY SECTION 718.503, FLORIDA STATUTES, TO BE FURNISHED BY A DEVELOPER TO A BUYER OR LESSEE.
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CURATING A NEW LEGACY
I N S I G H T I N T O T H E U LT R A LUXURY MARKET OF FINE ART
The famously traditional art market is finally embracing technology, propelling it into the modern business of luxury.
THE PROSPERITY REPORT | VOL 2
Clyfford Still, 1964.
Sold in 2020: $18,442,500 Courtesy Phillips
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The art market is one of the largest legal unregulated markets in the world, and yet despite its stature at the helm of luxury, it has always been rather traditionalist. However, in the face of a year where by March 2020, auction sales descended almost 76% from the previous year, the pandemic’s economic disruption became the cannon the market needed to catapult it into a new era of global reach and democratized access.
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Specifically, galleries, art fairs, auction houses, and institutions were forced to embrace new sales platforms and technologies, despite decades of reluctance. Simon de Pury, the renowned art auctioneer, dealer, and curator, attests to the market’s technological revolution, as well as its historical hesitation to have one; “In the first ten months of Covid, the market progressed more than it has in the ten preceding years,” he says.
Jean-Michel Basquiat – Portrait of A-One A.K.A. King, 1982. Sold in 2020: $11,500,000 Courtesy Phillips
Barnett Newman – Onement V, 1905-1970. Sold in 2020: $30,920,000 Courtesy Christie's Images LTD. 2021
INSIGHT Art Market Report 2021 Art Basel & UBS
By March 2020, sales in the global art market decreased by 76%; by December 31, that eased to -22% YoY, due to the market movement towards online sales.
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INSIGHT Artsy Gallery Insights 2021 Artsy
BESPOKE LUXURY MAGAZINE
Online marketplace Artsyʼs e-commerce sales rose 150% YoY between 2019 and 2020.
In an Artsy analysis surveying 1,758 art businesses in 97 countries, 87% of respondents sold art online in some way last year, while one-third reported closing their physical space and moving to a purely online model. On the purchasing side, 30% of collectors who purchased art online did so for the first time in 2020. Digital platforms also encouraged increased price transparency, making for a better user experience for collectors. Galleries had been wary about listing the prices of artworks online “out of a fear of appearing too transactional,” says Dustyn Kim, the Chief Revenue Officer of leading online art sales marketplace, Artsy. Transparent price listings that do not require a buyer inquiry, however, typically make sellers 6 times as likely to sell their work, a critical advantage in a year where inperson access to buyers was severely limited. As a result, there was a staggering 300% year-over-year increase in the ratio of gallery sales to inquiries at Artsy, says Kim.
George Condo – The Age of Reason, 2010. Sold in 2020: £2,082,369 ≈ $2,869,930 Courtesy Phillips
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YOUNGER COLLECTORS EMERGE AS GALLERIES GO VIRTUAL
Notably, online platforms attract much younger collectors, for whom purchasing big ticket items digitally is customary. In 2020, the number of 18 to 34-year-old collectors doubled from the previous year.
Access to larger global audiences also allowed galleries to participate in greater social movements and cause-driven work. For example, Artsy raised $8 million in online benefit auctions in 2020, for varied nonprofits and charitable causes. Demand also increased for work by a diverse array of artists, including female artists and artists of color.
Cy Twombly – Untitled (Bolsena), 1928-2011.
Sold in 2020: $38,685,000 Courtesy Christie's Images LTD. 2021
Roy Lichtenstein – Nude with Joyous Painting, 1994.
Sold in 2020: $46,242,500 Courtesy Christie's Images LTD. 2021
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Jean-Michel Basquiat – Ancient Scientist, 1984. Sold in 2020:
HK$58,330,000
≈ $7,509,579
Courtesy Phillips
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A D I G I TA L S E C O N DA R Y MARKET
Technology was similarly embraced in the secondary market. In 2020, the world’s three top international auction houses organized 644 onlineonly events, triple the amount of virtual auctions compared to the previous year, according to a 2021 report by Barron’s Consulting.
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This online embrace also democratized participation and helped auctioneers nurture the aspirational collector. “At each one of the big auctions, there have been up to 30% new buyers,” says de Pury, “which shows that there’s a massive renewal of the buyer base, much faster than usual.”
Roy Lichtenstein – White Brushstroke I, 1923-1997.
Sold in 2020: $25,417,000 Courtesy Sotheby's
Willem de Kooning – Women (Green), 1904-1997.
Sold in 2020: $23,260,000 Courtesy Christie's Images LTD. 2021
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INSIGHT Art Market Report 2021 Art Basel & UBS
The U.S. remained the leader of global sales between 2019 and 2020, commanding a 42% share in total sales volume.
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During Covid, online auctions at the major houses reached somewhere between 650,000 to 750,000 attendees. While auctions were broadcasted online before the pandemic, Covid massively accelerated not only online viewership, but online bidding and purchases themselves, despite a small percentage
of viewers being active bidders. Still, even with increased access, online sales did not completely replace in-person ones, as sales in both the primary and secondary art and antiquities markets fell an estimated 22% from their 2019 levels, according to Art Basel and UBS’s recognized annual Art Market Report.
Edvard Munch – Summer Day or Embrace on the Beach (The Linde Frieze), 1904. Sold in 2021: £16,284,000 ≈ $22,341,517 Courtesy Sotheby's
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W E LC O M I N G A N E W WAV E OF COLLECTORS
Masterworks, an online platform that allows individuals to invest in bluechip artwork, has also met newfound success as the art world moves online. Catering to a larger market of individual, smaller investors, rather than institutional investors or ultra-high-net-worth collectors, Masterworks is much like Robinhood
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for art collectors. It is paving the way for understanding what a digital art market can look like. In doing so, Masterworks is capturing a millennial collector audience whose buying power will only grow with time and age. According to a recent ART31 survey, 67.8% of young people considered the arts important, but cost and accessibility deterred them from becoming collectors.
Pablo Picasso – Femme Dans un Fauteuil, 1881-1973.
Sold in 2020: $29,557,500 Courtesy Christie's Images LTD. 2021
Sanyu – Fleurs Dans Un Pot Bleu Et Blanc, 1895-1966. Sold in 2020: HK$187,055,000
≈ $24,082,583
Courtesy Sotheby's
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Yayoi Kusama – Pumpkin, 1993. Courtesy Masterworks
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INSIGHT Simon de Pury
Art Auctioneer, Dealer, & Curator
“ The top auction houses held triple the number of virtual auctions in 2020 compared to 2019.”
Another trend to note is the recent 2021 arrival of NFTs, or non-fungible tokens, brought to fame by a Christie’s-brokered $69 million sale. The piece, Everydays: The First 5000 Days, a digital collage by artist Mike Winkelmann, also known as Beeple, was sold on Makersplace, an NFT art trading marketplace. NFTs are a blockchain token that can represent or back any asset and can be purchased with cryptocurrency Ether on a marketplace. This year, many of those backed assets have been digital art. While an NFT collector technically does not purchase any copyrights to the art itself, they simply own the blockchain token that backs it. That token, or NFT, is rendered valuable because it is issued as an exclusive limited edition by the artist him or herself. For the collector, the value and incentive of owning an NFT is the same buy-low-sell-high strategy used in stock trading.
THE PROSPERITY REPORT | VOL 2
Mariya Golovina, Masterworks’ Director of Acquisitions, says Masterworks has successfully “addressed the issue of access to the art market by lowering the financial threshold,” so that more admirers can participate.
Wayne Thiebaud – Four Pinball Machines, 1920. Sold in 2020: $19,135,000 Courtesy Christie's Images LTD. 2021
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INSIGHT Artsy Gallery Insights 2021 Artsy
BESPOKE LUXURY MAGAZINE
Between 2019 and 2020, the number of small galleries increased by 90%, while the number of medium galleries decreased by 29%.
Change in Gallery Size 2019-2020
SMALL GALLERIES (1 Employee)
2019
22%
2020
42%
MEDIUM GALLERIES (2-4 Employees)
2019
2020
62%
44%
* Data curated by Artsy’s Gallery Insights 2021 Report.
Between a growing global collector base, increased accessibility, and brand-new investment platforms, the art world is abundant with opportunity. Over the
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next decade, a new generation of gallerists, sellers, artists, and collectors will take reign, fundamentally transforming the industry for good.
Joan Mitchell – Untitled, 1953-1954. Sold in 2020: $11,297,500 Courtesy Phillips
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Sandro Botticelli – Portrait of a Young Man Holding a Roundel, 1480. Sold in 2021: $92,184,000 Courtesy Sotheby’s
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