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Passion Investments: Antiques
Masterpieces Underfoot
Debra Ryono
September 1, 2004
According
to legend, the mighty King Solomon owned a green silk flying carpet
large enough to hold his throne and coterie. While none of today’s
Oriental rug collectors, merchants or experts claim to have encountered
a carpet with magical powers, they have found that finely made antique
rugs can be enchanting investments.
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THIS 19TH-century Sultanabad carpet, created in the western area of Persia, is unusual for its color hues.
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In the world of rugs, there are two types of
buyers: The first purchases rugs to complete a decor. The second
considers them investments in fine art. Jon is a collector of the
latter sort, who asked us not to use his full name. His love affair
with rugs began during his years as a medical student in Jerusalem,
where he encountered them during a visit to the Modern Museum of
Islamic Art. Since then, Jon has invested $3 million in a collection of
nearly 150 carpets, many of which bedeck the floors and walls of his
California home. Jon acquired the vast majority of his pieces from
Claremont Rug Company. He swaps out rugs from those he keeps in
Claremont's warehouse from time to time, as their appeal to him ebbs
and flows.
The rugs inspire his wife,
who is an artist, and inform the sensibilities of their two young
children. “It’s wonderful art for children,” he explains. “The rugs are
the highest art form on the planet. If you take a very great painting,
there are still a few thousand people who could do a knockoff, and only
people with skill can tell the difference,” Jon says. “But a rug you
can’t copy. It’s like a Stradivarius violin.”
Jon
is clearly not alone in his enthusiasm. Jan David Winitz, founder and
president of Claremont Rug in Oakland and Berkeley, Calif., and an avid
collector himself, boasts a clientele that includes approximately 45
aficionados who have spent between $1.2 million and $7.5 million each
on Oriental carpets. “We have about 350 rugs in our vault that people
have purchased for investment purposes and left there to appreciate,”
he says. The individual prices vary from $40,000 to $250,000. “In a
20-year period—with all economic cycles—a rare antique rug can bring in
8 to 12 percent per year,” Winitz notes. “As far as good antique
rugs—not rare—appreciation is 5 to 8 percent per year for a quality rug
that is 100 years old or more.”
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TOP: A 19th-century Serapi was made in the northwestern area of Persia.
Bottom: The Caucasian Lori Pambak Kazak is from the private collection
of Jan David Winitz. (Photographs courtesy Claremont Rug Company.)
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Woven History
When
classifying rugs, the broad term “Oriental” refers to those made in a
region stretching from present-day Iran to western China, and south
into India. The Persian rug, made in what is modern-day Iran and the
best known of the Orientals, proffers heavily embellished and deeply
colored designs. A Caucasian rug (woven by the inhabitants of the
Caucasus Mountain region), by contrast, appears coarser, with geometric
patterns. “In Persia the eye was for silky and soft, ostentatious and a
reflection of success,” explains Raymond Benardout, a Los Angeles-based
dealer who has traded in rugs for nearly half a century. “Entertaining
was a major part of social life, and a carpet reflected its owner’s
success.”
Experts refer to pieces larger
than 35 square feet as carpets; smaller sections are rugs. The best
examples can take years of hand-racking work to complete; a family
might labor for 10 years on a single large carpet. The coarser rugs
have about 80 knots per square inch, while the most intricate Oriental
rugs, made for the Mughal rulers of India in the 16th and 17th
centuries, are comprised of more than 2,000 knots per inch. Patterns
and colors vary by region, and even by tribe or town. Typically, an
artist fashioned the design, which workers then labored to bring to
fruition.
Although rugs produced
in a particular region may be similar in appearance, each has its own
idiosyncracies—notably, in design or colors. Even within a particular
rug, colors may vary slightly from one line of knots to the next. This
variation, or abrash, is a natural result of the dyeing process. Wool
at the top of the lot may have dried more quickly than wool at the
bottom. Abrash is perfectly normal and acceptable. “The saying is that
only Allah is perfect,” muses Benardout.
Oriental
carpets began making their way into Europe as early as the 14th
century, but most of the oldest pieces are now only fragments, often
behind museum glass. When trade between Europe and the Ottoman Empire
became commonplace in the 1870s—and when Oriental rugs became de
rigueur in Victorian homes—the rug industry began to shift. Artisans
began to create carpets to suit European tastes, utilizing lighter
colors and often an overall pattern rather than centered medallions.
The rugs were initially sent to London, then shipped around the world.
Among
the most sought-after rugs from the late 1800s are those that were made
for Ziegler, a German company based in Manchester, England. The company
took traditional Persian designs and altered them for less-flamboyant
Western predilections. A Ziegler Mahal rug sold at Sotheby’s in April
for $275,185, well above the estimate of $73,000 to $92,000.
Polonaise
pieces have also paid off handsomely for their owners. These rugs,
standouts because of their gold threads, were so-named because Western
Europeans thought they were made in Poland, where they first saw them,
not realizing they had been imported from Persia as far back as the
1600s. The King Umberto Long Polonaise Carpet sold at Christie’s in
1993 for $691,390; nine years earlier it had sold for $210,950. The
Battilossi Esfahan Long Polonaise carpet sold for $679,590 in 1994,
over 150 percent more than its last sale in 1988. The hammer came down
on the Rothschild Esfahan Polonaise rug at $688,740 at Christie’s in
1999.
VALUE JUDGMENT
Over the course of the last century, the value of Oriental carpets has
cycled through periods of soaring highs and crashing lows. But
knowledgeable collectors who focus on fine antique rugs find that both
the visual and financial appreciation of their investment climbs
steadily.
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Such spectacular valuations are not common,
however. Rosalie Rudnick, a collector from Boston, became enamored with
the textiles when a water pipe broke in her home. The flooding ruined
her carpet, and her search for new flooring brought her into the world
of Oriental rugs. “The intellectual part of the rug world is
intriguing,” she says. “There is so much history that goes into the
rug, and generations of design.” Although she has profited from her
collection, she cautions that this field is not for someone seeking
spectacular returns. “If you’re lucky, you make money, but nobody gets
rich. Rare, unusual rugs are where you make the money, and even then it
does not always work out. Many times you overpay for the product.”
Used Rug Salesmen
While finely wrought antique rugs have appreciated in value, a flood of
rugs—some made by hand, others machine-fashioned—in the early 20th
century marred the field and reduced values overall. Carpet dealers
became infamous for dubious sales tactics: staging continuous
going-out-of-business sales, or vanishing as quickly as a flying carpet
after the deal was done. In some respects, the last two decades of the
20th century were even harder on Oriental rugs, contends Danny Shaffer,
editor of Hali, a London-based magazine on rugs and Islamic textiles.
“The middle market of the ’80s and ’90s was quite heavily overhyped.
People paid a lot of money for things, and a lot of people were left
sitting on equity. It did little to improve the perception of what
terrible people rug dealers are.” Reputable dealers of antique and new
rugs now adhere to a set of guidelines that attempt to weed out
questionable practices.
As
for new Oriental rugs, authentic, handmade pieces are expensive, and
they can prove sound investments. But fashion comes and goes, Shaffer
warns. “Rugs can be good investments depending on designers’ whims.
Styles change. At the moment, light of color and empty of design is in
fashion. But when colors return, big, pale rugs will sell for less than
what was paid.”
Even in the realm of
rare antiques, however, there is no guarantee of appreciation. “If you
are going to become a collector,” says Elizabeth Poole, vice president
and the head of the rugs department at Christie’s, “it is because you
love the object, not because you are going to make money. There is
appreciation, but it’s picky; collectors don’t want second-rate things.
Condition is a big issue.” While wear is expected—a rug is walked on,
after all—excessive damage or poor repairs hurt the value.
Jon,
however, holds fast to the belief that as an objet d’art, as well as an
investment, Oriental carpets hold great potential. “Rugs are largely
unknown and tremendously undervalued when you see what goes into their
making and the impossibility of reproducing them,” he waxes.
Of
course, their true value resides in the eyes of their beholder. “People
who are successful collectors have to trust their eyes,” Jon says.
“They should go with their heart and what they love. With my first
rugs, I just bought what I loved, and I’ve never regretted it. Place
your faith in your own aesthetic. There are no guidelines, just the
spark.”
RESOURCES
Claremont Rug, www.claremontrug.com
Hali Magazine, www.hali.com
Additional Information
Geography Lessons
Also see:
FINANCIAL TIMES - "Treasures You Purchase to Hold on to" (3/29/08)
Download printable version 
MARKET WATCH / THE WALL STREET JOURNAL - "Global Leap in Best Antique Rugs as Major Works of Art " (7/14/08)
Download printable version
MARKET WATCH / THE WALL STREET JOURNAL - "Domestic and International Connoisseurs Embrace Antique Rug Sales Event in “Next Frontier of Art Investing” " (6/2/08)
Download printable version
THE MERCURY NEWS - "Rare rugs" (5/30/08)
Download printable version
YAHOO FINANCE - "Claremont Rug Company Announces Additional Hudson River Valley Collection " (4/30/08)
Download printable version
REUTERS.COM - "Claremont Rug Company Holds Globally Significant Exhibition… Rare, 19th Century Caucasus Rugs" (12/17/07)
Download printable version
FORBES.COM - "Claremont Rug Company Acquires “Mother Lode” Collection of 19th Century Art Carpets" (2/12/08)
Download printable version
FORBES.COM - "Increasingly Savvy Clients and Decreasing Availability Combine with Internet To Create Perfect Storm in Rare Rug Market" (10/24/07)
Download printable version
MORNINGSTAR.COM - "Demand for Antique Carpets and Rugs Expands While Availability is Reduced" (9/16/07)
Download printable version
FORBES.COM - "Leading Antique Carpet Dealer Cites Boom in Internet Sales" (9/5/07)
Download printable version
CALIFORNIA CEO - "Putting
Out the Red Carpet: The Claremont Rug Company has woven a close
relationship with its customers thanks to a wise use of the Web."
Download printable version
CIO Magazine
- "Carpetbaggers: The Claremont Rug Co., purveyor of antique carpets
made centuries ago by Southwest Asian nomads, has benefited doubly from
the great leap forward to the Internet."
FINANCIAL TIMES - "How
To Spend It: East bay passions. The sit-ins are long since over, says
Holly Finn, but Berkeley has plenty to shout about...The Claremont Rug
Company - one of the world's best sources of antique carpets - is here."
Download printable version
SAN FRANCISCO CHRONICLE - "Art At Your Feet: Antique or copied oriental rugs express their weavers' inspirations"
Download printable version
OAKLAND TRIBUNE - "Web Helps Rug Store Clinch Sales"
BEL AIR ARTICLE - "What Hotel Bel Air (Beverly Hills, CA) says about Claremont Rug" |
