The super rich are getting pickier at art auctions
IT’S been prophesied for years, and now it’s finally come to pass: Auction prices for fine art are falling.
“It’s been coming for a while,” says the art adviser Jacob King, who bought a painting by Sturtevant at Christie’s on Wednesday (May 17) evening for US$882,000. “Art has gotten so expensive, across the board. And when you’re talking about works that are US$2 million, US$5 million, US$10 million, there’s just not that many buyers out there. Once someone has their de Kooning, they don’t necessarily want to buy another.”
This spring’s marquee auctions in New York have delivered a string of middling – and occasionally disappointing – results for artwork in a range of mediums, sizes and periods.
The slowdown comes after many seasons in which collectors, advisers and dealers wrung their hands over the potential for macroeconomic conditions to affect art prices, followed quickly by some variation of “but they didn’t!” once totals were triumphantly tallied.
The reset this year has been a welcome change for some on the buy-side. “This new situation is much more fun,” said the dealer Jeffrey Deitch, who could be seen bidding at auctions throughout the week. “A real auction where you might be able to get a bargain? That’s a dynamic market.” Deitch purchased a Jeff Koons sculpture at Christie’s for just under US$2 million, well under its estimate of US$3 million to US$5 million.
To be clear, this week was not a wipeout: Auction houses have collectively sold more than US$1.7 billion worth of art in just a few days – no small feat but below last year’s total of US$2.5 billion. (Christie’s: US$922 million; Phillips: US$108 million; Sotheby’s: US$716 million and counting.) And they did their best to keep expectations modest from the start, with only a handful of US$40 million-plus lots being offered.
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“We were very pleased with the week,” said Charles Stewart, Sotheby’s chief executive officer. “We had very large totals by any historical standard, sell-through rates were quite high and a lot of money was spent.” Buyers, he continues, “were incredibly impressive and very global”.
Dozens of artists’ records were set, including those of Barkley L Hendricks, whose full-length portrait of artist Stanley Whitney sold for US$6.1 million at Christie’s (with fees), and Louise Bourgeois, whose large Spider sculpture sold for US$32.8 million at Sotheby’s on Thursday evening. Buyers from around the world showed a willingness to spend whatever was necessary to buy the very best, or very rarest, examples of an artist or period: An ultra-rare painting by Henri Rousseau sold at Christie’s for US$43.5 million with fees, well above its high estimate of US$30 million.
“Like other sectors of the economy, it’s not even,” Deitch said. “There are sectors of the art market that are booming: You saw tremendous enthusiasm for work by Nicole Eisenman, Henry Taylor, Kerry James Marshall and some younger artists.” His takeaway, he said, is that “you are feeling the effects of the larger economic environment, but the art market is still quite solid”.
Collectors were also happy to bid aggressively for artists whose markets, at least in theory, have growth potential: At Phillips, a painting by the late painter Noah Davis took a lengthy 12 minutes to sell as bidders steadily pushed the price past its high estimate of US$150,000; with auction house premiums, its final price was US$990,600. And at Sotheby’s, a painting by Justin Caguiat (born: 1989), which carried an estimate of US$150,000 to US$200,000, sold for US$787,400.
Not every painting is a masterpiece, and not every artist is a market darling.
There appeared to be an unusual number of 11th-hour lot withdrawals before auctions began, often a sign that no has indicated interest in an artwork, or that the people who are interested refuse to pay the minimum a consignor has requested. “The power of auctions is that you find where the market really is,” Stewart said. “If there’s a lot that’s withdrawn, it may well be that the seller is not interested to proceed if [offers are] not what they were expecting.” The upside, he continued, “is that the sell-through rates of what was in the sales were very high, which is important”.
On Tuesday evening, Sotheby’s combined modern evening sale and standalone sale of the late record producer Mo Ostin had an estimate of US$375 million to US$534 million. The works collectively hammered at US$363 million, and auction house fees brought the total to US$426.8 million. Similarly, at Christie’s, the standalone evening auction of the late real estate investor Gerald Fineberg’s collection carried a presale estimate of US$163 million and ended with a disappointing hammer total of US$124.7 million; premiums brought it to US$153 million.
Notably, work from several former market stars failed to live up to expectations at both houses. Paintings by Christopher Wool, for instance, struggled to generate interest. At Christie’s Fineberg sale, one of Wool’s striking, colourful word paintings was estimated at US$15 million to US$20 million, and sold for just US$10 million with premiums. At Sotheby’s on Thursday evening, an additional Wool word painting carried an irrevocable bid and was estimated to sell from US$10 million to US$15 million; after what appeared to be just one bid, it sold for US$8.4 million.
“For some of the people who’ve come into the market over the past six years and seen prices just go up, it’s going to be shocking,” King said. “Works they thought were from iconic, blue-chip artists are selling for half of what they would a couple of years ago.”
Similarly, many works by Willem de Kooning stumbled. There were two at Sotheby’s Mo Ostin sale: One sold for US$5.8 million, just above its low estimate of US$5 million, and the second, which was estimated from US$1.5 million to US$2 million, failed to find a buyer. Another that same night at Sotheby’s was estimated from US$3.5 million to US$4.5 million and sold for US$3.3 million. Then there were three at Christie’s Fineberg sale: The first was estimated from US$6 million to US$8 million and sold for US$3.6 million; the second was estimated from US$8 million to US$12 million and sold for US$5.3 million; and the third was estimated from US$3 million to US$5 million and sold for US$1.9 million.
“It’s hard to generalise,” Deitch said. “When you have a B-minus de Kooning that doesn’t get a good price, it’s important – if you’re going to make this kind of analysis – to look at what an A-plus de Kooning is going for.” Indeed, Christie’s also sold a de Kooning from the estate of SI Newhouse estimated “in excess of” US$25 million, for US$30.9 million. “In this market there’s competition for superb rare work,” Deitch said, “and ones that are just sort of mediocre are not getting the prices that you would have seen in 2017”.
A year ago, the top 10 lots brought in just under US$760 million. This year, that number sank precipitously to just US$403 million, nearly a 47 per cent year-over-year decline. BLOOMBERG
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