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Spring auction season gets underway in New York City

Christie's gears up for high stakes atr auctions
Christie's gears up for high stakes atr auctions
Photo by Sion Touhig/Getty Images

Spring season is underway tomorrow at the big auction houses like Sotheby's and Christies's tomorrow, Tuesday (May 5), according to a report in The New York Times today. For more on this story Staten Island fans of big art sales and auctions, visit

"In many ways this year’s spring auctions, which begin on Tuesday, follow a familiar pattern: hefty catalogs, more and more art to sell, the promise of multimillion dollar prices for blue-chip names," adds the report on the art market today. "But a close reading of those catalogs shows that at least half of the postwar and contemporary art so lavishly pictured has a committed buyer already lined up — before the auctioneer even steps onto the podium."

The article lists a growing number of collectors who will spend more than $25 million on a Picasso or Rothko, with the belief that these names are a guaranteed art investment. "Auction house experts and seasoned collectors see this rush to get into the mix as fueling a speculative fever more typical of day trading on the Nasdaq than the once-refined pastime of buying art for aesthetic pleasure. Many of today’s new buyers, these sources say, are more interested in the art of the deal than in the art itself," according to The Times.

How do art investors make money at an auction? "At auction time, if the final hammer price is higher than the one promised by the guarantor, that person makes money — generally around 20 percent of the difference, which can translate into millions of dollars in profits. If the guarantor’s offer is higher, he or she goes home with the art," according to The Times article.

“It’s a win-win situation,” said Abdallah Chatila, a Lebanese-born contemporary art collector who lives in Switzerland and who has already guaranteed two artworks at Christie’s May sales, adds the report. “I really want both works, and if they sell for more than the guarantee it can also be very lucrative.”

"This spring, although most sellers are not revealed in catalogs, dealers familiar with their collections say David Ganek, the former hedge fund manager, is believed to be parting with a Twombly and a Warhol; Peter M. Brant, the newsprint magnate, is selling canvases by Basquiat and Haring; Steve Wynn, the casino magnate, a de Kooning; and Ronald O. Perelman, the New York investor, a Rothko. Most of those artworks have guarantees," states The Times.

"Sotheby’s reported nearly $280 million in guarantees as of April 15, more than four and a half times the $60.2 million figure for the first quarter of 2013; the proportion coming from outside parties is still in flux. As a publicly traded company, Sotheby’s is required to report guarantees," states the article. "Christie’s, which is privately owned, is not, but officials there confirmed it has about $400 million in guarantees to sellers this season, of which some $300 million is given by outside parties."

“When I started 25 years ago, collecting was romantic, but it’s not anymore,” said Philippe Ségalot, a former Christie’s expert who is now a private dealer to The Times. “Today it’s become business and guarantees are just part of the equation.”

Brett Gorvy, worldwide chairman of postwar and contemporary art at Christie’s, says it reflects the new attitude of many collectors, who no longer talk about an emotional response to art but increasingly ask him to chart its “trajectory,” to predict how their holdings will appreciate over time, according to The Times.

“The mind-set and perspective of these people have changed,” Mr. Gorvy observed to The Times. “It used to be that collectors rarely plotted the value of their art the same way they do their homes or stock portfolios, but more and more people are looking at their collections in the same terms as their other assets. “

He added to The Times, “Art has become an international commodity because the values are so high, and so are the returns.”

Global sales of art and antiques rose 8 percent last year to $65.9 billion, the highest level since 2007, according to the annual report for the European Fine Art Foundation. Growth was buoyed by an 11 percent spike in sales for postwar and contemporary art in 2013, according to the report.

Expectations were fueled last fall when Elaine Wynn, a co-founder of the casino empire, paid $142.4 million for a Francis Bacon triptych that Christie’s had estimated at around $85 million. Mr. Gorvy said 10 people had been willing to spend up to $80 million. “Of those, four were new to the field,” he said. “And two had never bid at auction before,” states the article.

"Christie’s estimates that it has 141 clients now willing and able to spend more than $50 million for just one work of art, Mr. Gorvy said. Officials at Sotheby’s say the number of buyers for art worth over $25 million has more than doubled since the market peaked in 2008," adds the report.

Several weeks ago Alexander Rotter, a co-head of Sotheby’s contemporary art department worldwide, started getting phone calls from clients wanting to act as guarantors," added The Times.

But guarantees can be “a dangerous game,” warned Mr. Brant, a major collector to the newspaper. “I would never guarantee something I didn’t want to own.”

"On Saturday, among those spotted perusing the sales — which include two Monets, multiple Picassos, Jeff Koons’s six-foot sculpture of Popeye and his stainless steel train filled with bourbon, each estimated at more than $25 million — were the hedge-fund billionaire Steven A. Cohen, the comedian Steve Martin, the cosmetics heir Ronald S. Lauder and his wife, Jo Carole, and the financier Donald B. Marron," states The Times.

"There are no paintings and sculptures yet poised to bring upwards of $100 million. But Christie’s does not think it is pushing its luck offering yet another Francis Bacon triptych: “Three Studies for a Portrait of John Edwards,” painted in 1984, of the artist’s closest friend," according to the report.

So Staten Island art enthusiasts with deep pockets, be on the alert as the gavel goes down at Sotheby's and Christie's tomorrow in the high stakes world of art collecting and investing.