Hedge-Funders & Art Bets

New York art adviser Nilani Trent’s tweet a few days before Thanksgiving said it all. “David Ganek’s hedge fund was

New York art adviser Nilani Trent’s tweet a few days before Thanksgiving said it all. “David Ganek’s hedge fund was raided by the FBI according to NYTimes. Boy is this going to shake up the art world.”

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News that Mr. Ganek’s Level Global hedge fund, plus two other hedge funds founded by fellow alumni of collector Steve Cohen’s SAC Advisors, were being investigated for insider trading has chilled the art world in advance of the industry’s annual warm-weather bacchanalia, Art Basel Miami Beach. (No formal allegations have been made against Mr. Cohen or SAC.)

Together, Mr. Ganek and Mr. Cohen, along with a small handful of free-spending Russians, have been responsible for some of the top prices paid for postwar and contemporary art in recent years. The two men continued to buy art, people close to the matter said, even as many other collectors took to the sidelines during the recession. Earlier this month, for example, Mr. Cohen paid $35.4 million for Andy Warhol’s Coca-Cola [4] [Large Coca-Cola], from 1962, at Sotheby’s auction house (as first reported by Judd Tully on artinfo.com).

Both Mr. Cohen and Mr. Ganek work with the same art adviser (though not exclusively)–Sandy Heller, who could not be reached for comment. One auction-house official said that the two men, mentor and protégé, rarely went head-to-head bidding on particular artworks, but that a sense of competition did fuel their avid art collecting.

Mr. Ganek owns works by Damien Hirst, Richard Prince, Cindy Sherman and Jeff Koons and is on the board of the Solomon R. Guggenheim Museum as well as the photographs committee of the Museum of Modern Art. Three years ago, his wife, Danielle, a novelist, was pictured in USA Today posing in front of the couple’s Christopher Wool painting which reads Sell the House, Sell the Car, Sell the Kids. He commissioned California painter Ed Ruscha to paint his corporate logo Level.

Earlier this year, meanwhile, Mr. Cohen paid about $110 million for a Jasper Johns Flag painting. In 2006, he paid David Geffen roughly $137.5 million for Willem de Kooning’s Woman III. His Damien Hirst shark is currently on view at the Metropolitan Museum of Art, where he sits on the institution’s painting and sculpture committee. (At one point, he owned an approximately 5 percent stake in Sotheby’s auction house.) Brett Gorvy, a co-head of Christie’s postwar and contemporary art department, once called Mr. Cohen’s art “the most comprehensive collection of American postwar images in private hands.”

Apparently not waiting to see what would happen, in November, one Gagosian employee began calling less-frequent Wall Street art buyers to see if they’d like to start stepping up their collecting, widening the radius, so to speak.

 

Hedge-Funders & Art Bets