Sotheby’s auction brings in $ 676 million
WHEN SOTHEBY’S lifted the hammer at the biggest art auction of the season on November 15, the sellers, Harry and Linda Macklowe, did not arrive together to watch the proceedings from the low-key skybox above the dining room. auction, as those who have a collection often do. The couple can hardly stand being in the same room. Their divorce, after nearly six decades of marriage, was so controversial that in 2018 a judge ordered them to sell 65 of their magnificent 20th-century artwork and share the proceeds.
Enjoy more audio and podcasts on ios Where Android.
Death, debt and divorce are the traditional catalysts of the auction market. Sotheby’s won this particular deal by guaranteeing the Macklowes at least $ 600 million from the sale. At the time, it was agreed that such a comprehensive promise, the biggest ever offered to a customer by an auction house, seemed to date back to a bullish era before covid-19 rocked the market for l ‘art. But the panache of Sotheby’s was well judged: the evening brought in $ 676 million including fees, to which will be added the proceeds of a second auction in May. Because beyond the Macklowe sale, the art market is evolving in three important ways.
It started even before the pandemic. The buyout of Sotheby’s by Patrick Drahi, a French telecoms and cable entrepreneur, for $ 3.7 billion in the summer of 2019 looked like a mistake after the fact when the covid hit nine months later. The lockdowns have closed auctioneers and galleries around the world. Art collectors quickly decided that 2020 was a bad time to sell. The most well-connected auction houses quickly started trying to negotiate private deals; the most entrepreneurial online sales have been bolstered by digital auctions.
Mr. Drahi’s commercial acumen has given new meaning to the famous art market joke that Sotheby’s are “auctioneers trying to be gentlemen”, unlike Christie’s, a company of “gentlemen trying to be gentlemen. ‘be auctioneers’. The tycoon, who took more than $ 1 billion in debt to fund the deal, now has access to details of the world’s estimated 300,000 richest people. The new Sotheby’s is determined to sell them not only art, but also handbags and history.
Its timing can be premonitory. Contemporary art, which accounts for the largest share of the art market, saw a record $ 2.7 billion change hands in the year through June, according to Artprice, which tracks sales. . Sotheby’s and Christie’s say they expect their sales in 2021 to match the $ 4.8 billion and $ 5.8 billion they made in 2019, respectively.
Part of the reason is that the two main auction houses are expanding beyond their conventional offering of art, watches and wine, the first big change in the market. In 2020, Christie’s sold a dinosaur fossil named Stan for $ 31.8 million. Earlier this year, Sotheby’s auctioned off Kanye West’s Yeezy sneakers for $ 1.8 million. The two companies dabbled in crypto-art, selling non-fungible tokens (TVNs) technicians. All of this has attracted new buyers, especially from Asia, the fastest growing market. Of the top 20 lots auctioned by Sotheby’s last year, Asian clients bid in ten and bought nine.
A second novelty is that the two houses are wooing new customers by making buying at auction more fun. Last month, Sotheby’s hosted a jamboree weekend in Las Vegas for 40 clients. The main activity was the auction of works of art by Picasso valued at $ 100 million. But in an effort to turn the deal into an experience, Sotheby’s also hosted a wine tasting, a how-to-play session, and a Jay Leno talk about vintage cars. At the after-sale party, the DJ was Picasso’s great-grandson.
Go, go, go
The most profound change, however, may be the warm new relationship of auction houses with commercial galleries and private dealers. Historically, these are their great rivals. Galleries know where the art is and what their clients might be willing to sell, but lack access to buyers who flock to auction houses. Now the two are working more closely together, to find the right buyer for a part and vice versa.
When a Düsseldorf gallerist recently wanted to sell a Gerhard Richter from the 1970s, an underestimated period, he turned to Sotheby’s. The private sale to one of his clients was at a much better price than what he would have gotten at auction or to one of his own collectors, he says. In April 2020, a month after the start of the pandemic, Rafael Valls, an Old Masters dealer in London, was able to sell nearly 100 photos at a Sotheby’s online auction; in a normal year, the gallery would sell around 200.
In an approach that highlights this rapprochement between auction houses and dealers, Sotheby’s recently hired Noah Horowitz, director of the Art Basel art fair known for being particularly close to galleries. “Sotheby’s is tearing up the traditional playbook,” says a rival. Marriage is in part a marriage of financial convenience: galleries lack the pools of capital that the big auction houses deploy to offer collateral and thereby attract potential sellers. Teaming up with dealers helps auctioneers find works to sell, which is almost as difficult for them as identifying the next generation of buyers.
Sotheby’s and Christie’s hope their new approach will help both sides of the trade. When Christie’s sold its first piece of cryptographic art earlier this year, its boss Guillaume Cerutti points out, almost all of the 33 bidders were new to the business. A few days later, one of the overbidded ones, a 31-year-old Chinese-American tech entrepreneur named Justin Sun, bought a $ 20 million Picasso and, in the Macklowe sale , a sculpture by Giacometti for $ 78 million. ■
For a more in-depth analysis of the biggest stories in economics, business and markets, sign up for Money Talks, our weekly newsletter.
This article appeared in the Business section of the print edition under the title “Monet, Manet, Money”