Let’s get one thing straight: any market that generates over $7 billion a year is doing fine. But, as has been the case the past few years, there’s mixed results reflected in the auction seasons: there are statistics we can examine in the spring 2019 sales that speak to bullish growth, enthusiasm and collector confidence; and there are other statistics that speak to a slowly waning art market. This fickle data requires collectors, advisors and appraisers to pay close attention to the nuances of each auction, and the fluctuations in each artist’s own market.
The nearly 2,000 lots offered this past May by the three major houses (Christie’s, Sotheby’s, and Phillips) grossed just over $2 billion; the equivalent sales last May brought in more than $2.8 billion—a gloomy decline. Another ominous statistic: Sotheby’s, the only publicly traded auction house of the three major houses, reported a 2018 income of $108.6 million, down from $118.8 million in 2017. For the first quarter of 2019, the auction house declared a loss of $7.1 million—worse than its $6.5 million loss for the equivalent period last year. One can perhaps attribute Sotheby’s decline to poor business decisions or structural issues, resulting in their recent decision to sell the company back to private hands for $3.7 billion. But one wonders if this regression is reflective of the secondary market as a whole (as privately held entities, Christie’s and Phillips do not report their profits and losses).
Another interesting fact: the number of guaranteed lots declined at both Christie’s and Sotheby’s from this time last year. In his New York Times preview of the spring sales, Scott Reyburn noted that this reflects seller confidence in the market; that these sellers don’t need the guarantees, and are confident enough to take on the risk that the good ol’ fashion auction model is all about. But seen another way: could the lack of guarantees reflect hesitation on the part of third-party guarantors—including the (possibly cash-strapped) auction houses themselves?
When we start to break down the sales themselves, the statistics get more nuanced. The “less good” news first: the Impressionist and Modern market generally continues to slow. Christie’s and Sotheby’s New York Imp and Mod day sales each sold below their aggregate estimates, respectively selling only 72% of their lots. Sotheby’s New York’s Imp and Mod evening sale came in just under $350 million, with the lion’s share of the revenue coming from the highlight of the spring season: a spectacular, luminous painting from Claude Monet’s haystacks series, which sold for $110.7 million—the new record for any Impressionist work at auction.
Yet despite the record-setting Monet, and a general sell through rate of 91%, other statistics from the Sotheby’s evening sale paint a different picture: twenty-five lots (nearly half of the offerings) sold below their low estimates, and some highlight works failed to sell at all, such as William Bouguereau’s La Jeunesse de Bacchus (1884), which stalled at $18 million, below its $25 million low estimate. And while this recent Imp and Mod evening sale did top Sotheby’s equivalent sale from 2018 ($318 million), both auctions relied heavily on the income of one major masterpiece (in 2018, half of the revenue of the evening sale came from Amedeo Modigliani’s $157 million Nu couché sur le côte gauche. As any business owner (myself included) will tell you: it’s never healthy to have your income so unevenly reliant on one source.
Speaking of blue-chip masterpieces: Christie’s Imp and Mod New York evening sale reached nearly $400 million ($50 million more than Sotheby’s), thanks in large part to the esteemed collection of the late Condé Nast juggernaut S.I. Newhouse, who passed away in 2017. Five artists alone accounted for more than $100 million of the Estate’s sales, including a $40 million Van Gogh landscape, and a Cézanne still life that was famously stolen in the 1970s and recovered in 1999, when Newhouse bought it at auction for $29.5 million. In their May sale, Christie’s sold it for $59.3 million.
As has been the case for many years, the news is better for the Postwar and Contemporary sales: the total sales for the three major houses was $1.214 billion. The gross revenue for the evening sales was $981 million, up 6.6% from the same sales last May. According to Artsy, this spring’s evening sales results were the biggest week for P&C auctions since November 2017 (which was greatly skewed by the $450 million sale of Leonardo da Vinci’s Salvator Mundi), and the best spring sales result since May 2015.
Love him or hate him, the big headline-grabber of the week was Jeff Koons, whose Rabbit (1986) broke David Hockney’s recent auction record for a living artist when it sold for $91.1 million at Christie’s (Christie’s increase in buyer’s fees, introduced February 1, just tipped it past Hockney’s $90.2 million record). This work was also from the collection of S.I. Newhouse, and purchased by art dealer Robert E. Mnuchin on behalf of a client.
The art market trend–or correction–for works by women and artists of color continued: Louise Bourgeois’s massive Spider sculpture (1996-97) sold in Christie’s evening sale for $32.1 million—a world record for the artist, and a new record for a contemporary sculpture by a female artist. If artist Dana Schutz’s market felt any fallout following the controversy around her Emmett Till painting in the 2017 Whitney Biennial, it appears to have recovered, with two back-to-back auction records: her 2009 painting Signing set a record of $980,000 at Phillips, only to be shattered a few hours later at Sotheby’s when Civil Planning (2004) burst past its $400,000 high estimate to sell for $2.42 million (backed by an irrevocable bid).
Other notable sales by women and/or artists of color this spring included British artist Cecily Brown’s Confessions of a Window Cleaner, which sold for $3.62 million at Sotheby’s New York evening sale, and British-Ghanaian painter Lynette Yiadom-Boakye’s Leave a Brick Under the Maple (2015), sold for 795,000 GBP (about $1 million) at Phillips London, almost double its high estimate. The latter’s market may be benefitting from her inclusion at the Ghanaian pavilion at this year’s Venice Biennale, as well as a forthcoming retrospective at the Tate Britain next year.
A record was also set for Toyin Ojih Odutola’s Compound Leaf, a self-portrait of the Nigerian-American on paper, which brought 471,000 GBP ($597,000) at Phillips London, well above its high estimate of 150,000 GBP ($191,000). And Tschabalala Self, the young African-American artist currently in residence at the Studio Museum in Harlem, set a new record when dozens of bidders competed for her 2015 collage Out of Body, ultimately selling for 371,250 GBP ($415,000).
It is remarkable that such recent works by young, trending artists are already coming up for auction, as galleries—and artists—struggle to keep up with the demand for fresh work. Some galleries have waiting lists for their hottest artists, and sellers are clearly willing to bypass galleries and put their works directly onto the secondary market, bringing prices that rival or even exceed gallery prices. Collectors are sometimes flipping their purchases after only a few a years: the seller of Odutola’s aforementioned Compound Leaf only acquired it in 2017, and a collector who bought Barkley L. Hendricks’s Yocks (1975) for $942,500 in May 2017, sold it this season for $3.74 million (against an estimate of $900–$1.2 million). This also speaks, however, to a still volatile and uncertain landscape for young artists who are not market-tested, and I urge collectors to make educated and measured decisions; we can learn lessons from artists like Jacob Kassay, whose auction market exploded rapidly between 2011–2013, and deflated just as quickly.
The other much-discussed winner of the spring sales was the street artist known as KAWS (aka Brian Donnelly). KAWS has not usually been taken seriously by critics, but his Instagram-friendly and accessible art has bypassed the usual market trajectory of artistic success (i.e. through critics and curators); Scott Nussbaum, head of 20th century and contemporary art at Phillips, especially credits a young, emerging class of collectors from Asia for boosting KAWS’s market. Following a whopping $14.8 million sale at Sotheby’s Hong Kong this spring for The KAWS Album (2005)—a parody of the Beatles’ famous Sargent Pepper’s Lonely Hearts Club Band album cover, with characters from The Simpsons—for the first time, all three major houses simultaneously included works by KAWS in their sales (19 works total). In these recent auctions, KAWS’s pieces continuously surpassed their estimates, including 2012’s The Walk Home, a large painting featuring SpongeBob SquarePants which sold at Phillips for an impressive $6 million, 10 times its low estimate of $600,000–a ‘KAWS’ for celebration (sorry, I couldn’t help myself). We’ll see what the fall sales have in store for him and the rest of the P&C market.
Until the next market report!