Reviewing the NYC Sales

The Wall Street Journal reviews the sales and analyzes the results from the recent $2.2 billion in art sales at Christie's, Sotheby's and Phillips. The WSj called the impressionist, modern and contemporary sales a "head-spinning rollercoaster ride".

The article notes sellers are getting greedy while buyers are getting picky, meaning quality art is in great demand and buyers are willing to pay top dollars to obtain the best. Expectations are now when and what artist will break the $200 million threshold for art at auction.

The Wall Street Journal reports

Instead of catalogs, New York’s art auction houses should have handed out seatbelts the past two weeks, as the fall round of impressionist, modern and contemporary art sales turned into a head-spinning rollercoaster ride.

Prices spiked for coveted masterpieces like Amedeo Modigliani’s portrait of a “Reclining Nude” that sold at Christie’s International for $170.4 million, the second-highest price ever achieved at auction. But at other times, bids were eerily absent for anything considered mediocre or overpriced.

Collectors, who bought $2.2 billion worth of art from Sotheby’s, Christie’s and Phillips this time around, haven’t navigated this level of volatility since the market peaked seven years ago. Now, market watchers are bracing for a plateau. “It’s an intelligent, well-informed market that’s cooling,” said art adviser Stephane Connery, “but it’ll still chase works that are really great.”

A fresh dose of skepticism could prove healthy for the market in the long run, dealers said, evening out price levels after several seasons of straight-up growth. The marketplace did manage to absorb hundreds of artworks offered during the sales, with houses finding buyers for between 71% and 89% of works in their all-important evening sales.
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Artists who passed their market tests included modernist sculptor Alexander Calder, Italian conceptual artist Michelangelo Pistoletto, shiny abstract artist Rudolf Stingel and geometric painter and sculptor Frank Stella, the latter buoyed by his current retrospective at New York’s Whitney Museum of American Art. Those who struggled included Andy Warhol and Willem de Kooning.

Here are some other lessons to be gleaned from the fall sales, which end Friday:

Sellers are getting greedy.
At least 13 works that ranked among the priciest pieces sold during the first five evening sales were snapped up by lone bidders. They include a $95.4 million Roy Lichtenstein “Nurse” at Christie’s and a $70.5 million Cy Twombly abstract, “Untitled (New York City)” at Sotheby’s. Dealer Larry Gagosian also had to buy Jeff Koons’s “Balloon Swan (Yellow)” at Christie’s Tuesday when no one else wanted it for its $15 million low estimate. He won it for $14.7 million. This thin-at-the-top atmosphere tells the houses that market sellers are demanding high estimates that spook potential bidders rather than lure them in.

Buyers are getting picky.
Like many artists, New York graffiti-style painter Jean-Michel Basquiat had an uneven week. Some of his works estimated to sell for at least $8 million, such as an orange-and-purple “Hannibal” at Sotheby’s Wednesday, garnered no bids. (U.S. authorities seized the work from Brazilian collector and convicted embezzler Edemar Cid Ferreira two years ago.) But collectors glommed onto an untitled Basquiat being sold by the artist’s estate, pushing its price to $8.3 million, more than tripling its high estimate.

Is $200 million the new target price for trophy art?
A decade ago, few collectors were willing to pay $50 million for a painting, much less $100 million. Nowadays, auctioneers are putting nine-figure asking prices for their star lots in these sales in hopes trophy hunters push prices far higher. In May, Christie’s sold Pablo Picasso’s “Woman of Algiers (Version O)” for $179.4 million, the most ever paid at auction for an artwork. On Monday, it got $170.4 million for Modigliani’s “Reclining Nude.” Who will break the $200 million barrier?

Hope for Asia to bid, but don’t bet on it.
Asian bidders have been the wild card of recent seasons, turning up and splurging on an ever-expanding roster of artists. But their participation is increasingly unpredictable. This round, they eschewed onetime favorites like Claude Monet yet bid or won works by Ernst Ludwig Kirchner, Calder, Warhol and Lucio Fontana, whose yellow, punctured “Spacial Concept, the Death of God” sold to a Chinese bidder for a record-setting $29.2 million at Christie’s Wednesday.

Sotheby’s hoped to make history by selling a portion of the estate of its former owner A. Alfred Taubman for between $405 million and $570 million, a record-high target for an estate. But during the first of four planned sales, collectors sniffed at a few pieces like Edgar Degas’s 1886-88 pastel, “Nude Woman, Back,” which was estimated to sell for at least $15 million but went unsold. With two sales of American art and old masters still to come, the estate’s running total of $420 million could still be considered a coup—except the house set expectations dauntingly high by giving Mr. Taubman’s heirs a guarantee of around $515 million. That means Sotheby’s won’t profit until the sale crosses that bar. (Sotheby’s said it will likely break even, eventually.)

Source: The Wall Street Journal