The rise of private sales at auction houses
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Sotheby’s kicked off this week’s Modern and contemporary art auctions with a sprightly evening sale that made a total of £77.9m (£93.3m with fees, est £75.5m-£104.5m). Top lot was Jean-Michel Basquiat’s appropriately titled “Apex” (1986), which nudged ahead of its presale estimate to sell for £7.1m (£8.3m with fees). Back in 1988, this work sold for £16,500.
Other seven-figure sums reached on Tuesday evening included Lucian Freud’s small “Head of a Boy” (1956), a painting that had been owned by its late subject, the Guinness heir Garech Browne, and which sold for within its already punchy estimate for £4.9m (£5.8m with fees). Much of the action was unsurprising — both works were among 22 lots out of the 66 offered that carried third-party guarantees (a further four works were guaranteed by the auction house and all sold). A sell-through rate of 91 per cent is nonetheless impressive.
The only hiccup came when a bidder in the room ostensibly bought Philip Guston’s “Lamp” (1979) for £1.5m and then — waving a champagne glass instead of an official paddle — proved a false buyer. Auctioneer Oli Barker coolly re-offered the lot later on, when it sold to its third-party guarantor for £1.4m (£1.7m with fees).
Christie’s equivalent auction felt faster-paced on Wednesday and also sold well (93 per cent by lot). The total £67.4m (£79.3m with fees) was within estimate and dominated by David Hockney’s “Henry Geldzahler and Christopher Scott” (1969), which sold for £33m (£37.7m with fees, est £30m). Another Hockney — “A Realistic Still Life” (1965) — from the collection of the artist Frank Stella, failed to find a buyer (est £1.5m-£2m).
Both auctions made less than the evening sales last year, when each exceeded the £100m mark (including fees), but they demonstrated a London market that is still breathing, despite concerns of an uncertain Brexit ahead.
Some art buyers prefer to shop discreetly, so the top-tier auction houses now have growing private sales departments that help them win business that might otherwise have gone to art dealers. In 2018, private sales at Sotheby’s hit $1bn for the first time, a sizeable chunk of last year’s consolidated sales value of $6.4bn. Christie’s also reported a gain in private sales, up 7 per cent to $643.3m, though these represented a smaller portion of its total sales ($7bn) last year. Neither auction house breaks down the number of so-called “after-sales” of works that fail to sell at auction and then find a buyer behind closed doors, but Sotheby’s confirms these are not included in its private sales figures.
One problem with the private sales revenue stream is that it is volatile, so the totals bounce up and down each year (presumably something that art dealers are used to by now). There is a loose inverse correlation between the two areas of business — the healthier the market, the more likely sellers are to risk a public auction and vice versa — but in truth the private sales business is too young to predict.
Sotheby’s 2018 revenue (mostly from commissions) fell slightly to $1.04bn, while net profits fell from $118.8m to $108.6m, though both came in ahead of analyst expectations. Auction commission margins (the money Sotheby’s actually makes from its sales) fell from 17.2 per cent to 16.1 per cent during the year, mostly because high-value paintings incur lower fees, as well as other sweeteners that can eat into profits. Sotheby’s, Christie’s, Phillips and Bonhams have all upped their fees this season.
London’s adventurous Emalin gallery is taking advantage of its four-day showing at New York’s Independent fair this weekend (March 7-10) and decamping to the city for a month. “It’s our first fair outside of Europe, the whole thing is more expensive to do than most and there’s only so much air time you get with collectors at an art fair,” says Leopold Thun, Emalin’s co-founder. He and his business partner, Angelina Volk, have therefore rented out the Alyssa Davis Gallery in the West Village for a solo show of the Russian artist Evgeny Antufiev (March 1-24, photographs and sculptures range from $2,500 to $12,000).
The strategy makes commercial sense. Thun is still paying rent at their Shoreditch space but, he says, this is closed anyway for a time-consuming installation of a show by the Lithuanian artist Augustas Serapinas that opens on April 4. Davis meanwhile had no exhibitions planned in her New York space this month.
At Independent this weekend, Emalin is showing works by Megan Plunkett based on images that the Los Angeles artist has pulled from Craigslist, an American classifieds website (priced from £1,000).
Other galleries are bypassing the art fairs altogether — Chicago’s Patron gallery has decided instead to rent a pop-up space in New York to coincide with the city’s art week (Greg Breda and Myra Greene exhibition, 213 Bowery, March 7-10).
There’s been a good reaction to this year’s 31st edition of the ADAA fair that hosted 72 members of the Art Dealers Association of America in the Park Avenue Armory between February 28 and March 3. Alma Luxembourg, partner of Luxembourg & Dayan gallery, showed at the fair for the first time and was pleasantly surprised. “The location is great and I love that all the booths are about the same size, it felt less hierarchical than other fairs,” she says. Sales from their blue-based booth included three works by the octogenarian Irma Blank (asking price $100,000 each) and a four-part Boetti ballpoint work with an asking price of $700,000. New York dealer Sean Kelly sold out his booth of eight new works made by the local artist Sam Moyer for the fair ($40,000-$50,000 each).
The ADAA event hasn’t always been so well received. Exhibiting is limited to galleries in the US, which has come in for criticism in the past, though now that so many overseas businesses also operate in New York, the fair has a more international feel. Attendance reportedly suffered last year because New York’s Armory Show, a bigger fair for contemporary art, moved its dates to the following week, meaning that the two events no longer coincided. Decoupling doesn’t seem to have affected business, however. “They attract different audiences,” Luxembourg says. The ADAA’s emphasis on Modern art attracts an older Upper East Side crowd than the Armory Show, which opened on the westside piers on Wednesday.
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