One idiosyncracy of my native England is that many property owners don’t technically
own their homes at all; instead, they have very long-term leases, which are
typically initially 99 years long, and which can be bought and sold and speculated
upon just like regular property. Now the Italians are getting into the act,
too, proposing to sell
50-year leases on deteriorating national treasures such as the 14th-Century
Villa Tolomei, outside Florence.
And if it works for buildings, why can’t long-term leases like this work for
art, as well? In Slate, Tim
Harford reports on the proposal of MIT’s Michael Kremer, who thinks that
countries should lease out their antiquities for a few decades. The long-term
nature of the lease would ensure that the leaseholder took good care of the
object, while many of the perenially heated arguments about national patrimony
would be rendered moot.
There’s also no reason in theory why museums, too, shouldn’t sell long-term
leases as an alternative to deaccessioning works. A hedge-fund manager might
well be primarily interested in having a magnificent painting on his wall: once
he’s dead, there’s no reason it shouldn’t ultimately revert back to the museum
whence it came. If the lease is long-term enough, the hedge-fund manager, if
he gets bored of the work, might even be able to sell it at a profit, just as
many people sell their UK leasehold properties for more than they bought them
for.
No one really knows what kind of discount the art market might apply to a 50-year
lease as opposed to outright ownership, but certainly a 50-year bond trades
at pretty much the same price as a perpetual bond with the same coupon, so the
discount might be quite small. There’s only one way to find out.