The Economist - UK (2021-11-20)

70 Business The Economist November 20th 2021

Theartmarket

Monet, Manet, Money

W

hensotheby’sraisedthegavelon

theseason’sbiggestart auctionon

November15ththesellers,HarryandLinda

Macklowe,didnotarriveasonetowatch

theproceedingsfromthediscreetskybox

abovetheauctionfloor,asthosedisposing

ofacollectionoften do.Thecouplecan

hardlystandtobeinthesameroomto­

gether.Theirdivorce,afternearlysixde­

cadesofmarriage,wassocontentiousthat

in 2018 a judgeorderedthemtosell 65 of

theirmagnificent 20th­centuryartworks

andsplittheproceeds.

Death,debtanddivorcearetheauction

market’s traditional catalysts. Sotheby’s

wonthisparticulardealbyguaranteeing

theMacklowesatleast$600m fromthe

sale.Atthetimeitwasagreedsucha ful­

somepromise,thebiggesteverofferedtoa

clientbyanauctionhouse,seemedtohark

backtoa bullishagebeforecovid­19roiled

theartmarket.ButSotheby’spanachewas

welljudged:theeveningbroughtin$676m

includingfees,towhichtheproceedsofa

secondauctioninMaywillbeadded.For

beyondtheMacklowesale,theartmarket

ischanging,inthreeimportantways.

It startedeven beforethe pandemic.

ThetakeoverofSotheby’sbyPatrickDrahi,

a Frenchtelecomsandcableentrepreneur,

for$3.7bninthesummerof 2019 looked

withhindsightlike anerrorwhencovid

struckninemonthslater.Lockdownsshut­

teredauctioneersandgalleriestheworld

over. Artcollectorsquickly decided  that

2020 wasa badtimetosell.The best­con­

nectedauctionhousesmovedswiftly into

tryingtobrokerprivatedeals;the more en­

trepreneurialbolsteredonlinesales  with

digitalauctions.

Mr Drahi’s commercial nous  has

broughtnewmeaningtothefamous  art­

marketquipthatSotheby’sare  “auction­

eerstryingtobegentlemen”,incontrast to

Christie’s,a firmof“gentlementrying to be

auctioneers”.Thetycoon,whotook on well

over$1bnofdebttofinancethe deal, now

hasaccesstodetailsofthe300,000  or  so

richestpeopleintheworld.Thenew Soth­

eby’sisbentonsellingthemnot  just  art,

buthandbagsandhistorytoo.

Histimingmayproveprescient.  Con­

temporaryart,whichaccountsfor the sin­

glebiggestshareoftheartmarket, saw a re­

cord­breaking$2.7bnchangehands during

the year to June, according to  Artprice,

which tracks sales. Both Sotheby’s  and

Christie’ssaytheyexpecttheirsales in 2021

tomatchthe$4.8bnand$5.8bn  they  re­

spectivelymadein2019.

Inpartthatisbecauseboth  the  main

auction houses are expanding  beyond

theirconventionalofferingofart, watches

andwine—themarket’sfirstbig  shift.  In

2020 Christie’s sold a dinosaur  fossil

namedStanfor$31.8m.Earlier  this  year

Sotheby’s auctioned Kanye West’s  Yeezy

trainersfor$1.8m.Bothfirmshave jumped

into  crypto­art,  selling  non­fungible  to­

kens  (nfts)  to  techies.  All  of  these  have

brought  in  new  buyers,  especially  from

Asia,  the  fastest­growing  market.  Of  the

top 20 lots auctioned by Sotheby’s last year,

Asian clients bid on ten and bought nine. 

A  second  new  development  is  that  the

two houses are wooing new customers by

making  buying  at  auction  more  fun.  Last

month  Sotheby’s  organised  a  weekend

jamboree  in  Las  Vegas  for  40  clients.  The

main  business  was  the  auction  of  $100m­

worth of artworks by Picasso. But in an ef­

fort to turn the affair into more of an expe­

rience, Sotheby’s also laid on wine­tasting,

a session on how to gamean auction and a

talk by Jay Leno about vintage cars. At the

party  after  the  sale,  the  djwas  Picasso’s

great­grandson.

Going, going, gone

The  most  far­reaching  shift,  though,  may

be  the  auction  houses’  new  cosy  relation­

ship with commercial galleries and private

dealers. Historically these were their great

rivals. Galleries know where the art is and

what  their  clients  might  be  prepared  to

sell, but lack the access to buyers who flock

to auction houses. Now the two work more

closely together, to find the right buyer for

a piece and vice versa. 

When  a  Düsseldorf  gallerist  recently

wanted  to  sell  a  Gerhard  Richter  from  the

1970s,  an  under­appreciated  period,  he

turned to Sotheby’s. The private sale to one

of  its  clients  was  at  a  far  better  price  than

he  would  have  got  at  auction  or  selling  to

one of his own collectors, he says. In April

2020, a month after the pandemic hit, Ra­

fael Valls, an dealer in Old Masters in Lon­

don, was able to sell nearly 100 pictures in

an  online  Sotheby’s  auction;  in  a  normal

year the gallery would sell around 200. 

In  a  move  that  highlights  this  rap­

prochement  between  auction  houses  and

dealers, Sotheby’s recently hired Noah Ho­

rowitz,  a  director  of  the  Art  Basel  art  fair

who  is  known  to  be  particularlyclose  to

galleries. “Sotheby’s is tearing up the tradi­

tional playbook,” says a rival. The marriage

is partly one of financial convenience: gal­

leries lack the pools of capital big auction

houses deploy to offer guarantees and thus

lure  potential  sellers.  Teaming  up  with

dealers  helps  auctioneers  find  works  to

sell,  which  is  almost  as  hard  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 first piece of cryp­

to­art  earlier  this  year,  its  boss  Guillaume

Cerutti points out, almost all of the 33 bid­

ders were new to the firm. A few days later

one  of  those  who  had  been  outbid,  a  31­

year­old Chinese­American tech entrepre­

neur  named  Justin  Sun,  wentontobuy  a

$20m Picasso—and, in the Macklowesale,

a Giacometti sculpture for $78m.n

A galloping auction at Sotheby’s paints a new picture of the art world

Twombly for the price of one