December 27, 2013 6:17 pm

The Art Market: The beginning of a new world order for sales?

Tobias Meyer, who left Sotheby’s in November©Getty

Tobias Meyer, who left Sotheby’s in November

Will 2013 go down in art market history as the peak of a boom, or the beginning of a new world order for art sales? After the blockbusting, $691m sale of contemporary art at Christie’s in New York in November, with its record high prices – $142.4m for a Bacon, $58.4m for a Koons – art adviser Abigail Asher declared: “It’s a new world: it feels like a reinvention of the art market. I’m overwhelmed.” Certainly, the prices now fetched in the market for top-level, postwar and contemporary art by both living and dead artists are enormous and inexplicable to many. But according to Christie’s, there were six people bidding more than $100m for the Bacon – two of them Asian. Every one of the top ten in that sale went for more than $20m. That gives an idea of the depth of the market and its geographical spread. As New York dealer Edward Tyler Nahem said: “In sheer defiance of other global economic trends, or perhaps because of such trends, there is an unprecedented flow of money into the art market. For some, this could represent a flight of capital from other conceivably more unstable harbours to comfortably park one’s wealth.”

While it is customary to say that the market’s strength is focused on just a few artists, Art Basel Miami Beach and its attendant fairs, taking place a couple of weeks after the New York sales, saw art selling merrily at every level – from the million-dollar, safe-bet end of Katz, Calder and Koons to emerging artists priced from the low thousands at the satellite fairs. These included a paper construction by Sarah Bridgland at $2,000, digital animations by Yorgo Alexopoulos at $11,000 and a diptych by Hans Kotter at $35,000, all of which found buyers at the Pulse fair.

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It seems contradictory that the follow-up to the rip-roaring New York sales was the departure of two major figures from the contemporary art departments of Sotheby’s and Christie’s. The news that Tobias Meyer, chief auctioneer and head of contemporary art at Sotheby’s, had left was shuffled out on a Friday night just before Thanksgiving week. With Sotheby’s under attack from activist shareholders, notably Daniel Loeb – who is also an art collector – all sorts of interpretations were put on his departure, but it does seem to have been by mutual agreement. Then in December Christie’s head honcho for “contemporary art development”, Amy Cappellazzo, also jumped ship. Both Meyer and Cappellazzo say they will be working in private sales, and this makes sense. They know the business through and through, they know “where the bodies are buried” in auction speak, meaning the location of the juiciest works of art, and they hobnob with the top collectors. Instead of drawing a salary, why not earn much more as dealers?

'Three Studies of Lucian Freud' (1969) by Francis Bacon, which sold for $142.4m

'Three Studies of Lucian Freud' (1969) by Francis Bacon, which sold for $142.4m

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The year also saw Christie’s and Sotheby’s continue their thrusts into new markets. Both have been longing to get into mainland China, and both held sales there. Christie’s rolled out the red carpet for Chinese buyers in September in Shanghai, when it held a small but significant sale of western and Asian art, watches and various sundries, garnering $25m and selling a Picasso for $1.9m. Of the 40 lots on offer, only one failed to sell, but the point of the event – for which Christie’s shipped in all its top brass and a swath of collectors – was to anchor the brand in Chinese minds. Then Sotheby’s held a “Beijing art week”, with an auction and selling show, making $37.3m for a 141-lot auction and setting a new price high for Zao Wou-ki at $14.7m. Finally, Christie’s was gearing up for its first sale in India, with an 83-lot sale in Mumbai, scheduled just before Christmas.

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Bad news came this year, however, for collectors who had trusted the Knoedler name and bought multimillion-dollar works from the venerable New York gallery, shuttered in 2011. People such as Tom Ford’s chairman Domenico De Sole, hedge fund manager Pierre Lagrange, the Kemper Museum of Contemporary Art in Missouri and many others had acquired from the dealer abstract expressionist and modernist works by the likes of Rothko, Kline and Pollock, some for multimillion sums. The person who supplied them to Knoedler, Glafira Rosales, pleaded guilty in September to selling fakes fabricated by a Chinese painter in Queens. Knoedler is closed and Rosales is facing a long prison sentence, so who will compensate buyers – seven are suing – for their now-worthless paintings?

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Glafira Rosales leaves court©Getty

Glafira Rosales leaves court

The case was also bad news for art experts, a number of whom had accepted as authentic the works Knoedler was selling. Conclusion: it seems much easier than previously thought to hoodwink specialists of 20th-century works of art. Provenance, now, is going to be far more important. Ideally in the future, a vendor called “Mr X-who-doesn’t-want-to-be-named” will set off all sorts of alarm bells, although I actually doubt the designation will disappear completely. A new art sales site, ArtWise, is apparently going to connect buyers and sellers while each keeps complete anonymity – hardly the more transparent market that many would like to see in the wake of the Rosales scandal.

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As for art galleries, 2013 saw further expansion internationally. Paris’s Emmanuel Perrotin opened a New York outlet, adding to an operation that includes Hong Kong and three galleries in Paris. Marian Goodman is opening in London next year: Thaddaeus Ropac will inaugurate a new space in 2014 at an as-yet-undisclosed location – but not in Europe. At the same time, a number of midsized dealers closed, squeezed between the big boys and the smaller, slimmer emerging galleries. D’Amelio Terras in New York, Jérôme de Noirmont in Paris and Martin Klosterfeld in Berlin all closed. And some other Berlin galleries were thought to be in the red.

Georgina Adam is art market editor-at-large of The Art Newspaper

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