Buoyant Art Market Draws International Buyers

Asian Works GrabMost of the Buzz;A Big Russian Gift
By KELLY CROW

January 2, 2008; Page R19

Francis Bacon's "Self-Portrait" sold for $43 million.

The art market had another bumper year in 2007, as buyers from Asia, Europe and the U.S. chased the world's priciest works and mostly ignored the turmoil in the financial and housing markets.
Sotheby's said it sold about $5 billion of fine and decorative art last year, up 39% from 2006. The 2007 total included $1.3 billion in contemporary art, more than double the year before; $1.1 billion of Impressionist and modern art, up 24%; and $281.8 million in jewelry, up 44%.
Christie's International PLC sold about $6 billion in fine and decorative art last year, up 30% from $4.6 billion in 2006. Closely held Christie's said it will release full sales figures later this month.
In November, Sotheby's set an auction record for a contemporary artwork when it sold Mark Rothko's "White Center (Yellow, Pink, and Lavender on Rose)" for $72.8 million to an anonymous buyer. The top sale at Christie's was Andy Warhol's "Green Car Crash," which went for $71.7 million in May.
Among private art deals, a group of investors reportedly paid artist Damien Hirst $100 million for his diamond-encrusted skull, "For the Love of God."
Collectors got skittish only once, when a Vincent van Gogh landscape guaranteed to sell for $35 million went unsold at the Sotheby's Nov. 7 Impressionist sale in New York.
Sotheby's shares fell by nearly one-third to $35.84 the next day. By Dec. 31, the shares had risen 6.3% from that point to $38.10 in 4 p.m. New York Stock Exchange composite trading.
Asian art and its buyers captured the most buzz. The wealth boom in Asia solidified Hong Kong's role as a major sales hub for art, not only traditional jades and Ming vases but also Asian contemporary art. Asian and Western collectors -- along with speculative investors -- traveled to Hong Kong, or bid remotely, for works by Yue Minjun and others. Christie's sold $466 million of art in Hong Kong last year, up 28% from the year before.
Interest peaked in October, when Mr. Yue's painting called "Execution," inspired by the 1989 crackdown on protesters in Tiananmen Square, sold for £2.9 million, or $5.8 million, at Sotheby's in London -- another city where art sales are on the rise.
Henry Welt, a fine-arts business strategist in New York, expects the auction market to continue drifting east from New York to London and Hong Kong. "Asian buying is real and strong, and it will last because it's a reflection of their enormous wealth creation and demographics," Mr. Welt said. London is a "more convenient" hub than New York for buyers living in Europe, Russia and the Middle East, he said.
Mark Rothko's "White Center (Yellow, Pink and Lavender on Rose)" sold at auction for $72.8 million. And an ancient limestone figure of a lioness (shown in actual size) that a collector purchased for $57 million.
Currency fluctuations had an effect. European collectors took advantage of the weak dollar by flocking to art fairs in Miami and auctions in New York. In May, Europeans took home about half the art offered at Christie's New York evening sale of Impressionist and modern art, nearly twice as much as they typically buy. In November, the New York contemporary sales were dotted with London collectors such as jeweler Laurence Graff, who bid on works by Andy Warhol. U.S. enthusiasts tried to offset the weak dollar by reselling their art in once-overlooked auction spots like Paris.
Collectors from Russia, the Middle East and oil-rich states in the U.S. West -- all flush from the same global commodities boom -- invested heavily in art last year, especially works that reflected their regional cultures. Russians were "less affected by the credit crunch, fiercely proud of their mother country, competitive and cash rich," said Charles Dupplin, an art expert at specialty insurer Hiscox Ltd.
Paul Gauguin's "Te Poipoi" was purchased for $39.2 million.
In September, energy-and-steel magnate Alisher Usmanov paid Sotheby's more than $40 million to buy an entire collection of Russian paintings, porcelain and glassware days before the collection was to be auctioned; Mr. Usmanov said he plans to donate the collection to the Russian government.
Christie's continued to expand its efforts to reach Middle Eastern art lovers by holding two modern and contemporary art sales in Dubai, which collectively brought in $24.6 million, up from a single, $8.4 million contemporary sale the year before.
Christie's said sales also were unexpectedly brisk for an under-the-radar collection of Western art featuring Frederic Remington bronze sculptures of cowboys on horseback, thanks to collectors in Texas and Colorado. Overall, Christie's brought in $240 million in sales of American art.
Some art experts worry that the auction houses have become too reliant on risky tools to attract business.
For the major fall auctions of Impressionist and contemporary art in November, Sotheby's and Christie's used guarantees -- effectively assuming the risk involved in selling artwork at auction by promising the seller a specific but undisclosed price -- to buy outright a combined $1 billion of art before the sales. Their total tally for those fall sales was $1.7 billion.
Sotheby's Chief Executive Bill Ruprecht said guarantees are profitable and will continue to be used -- especially since there are no signs that art buying is slowing.
In December, a British buyer surprised the art world by paying Sotheby's $57 million for a three-inch-tall ancient limestone figure of a lioness estimated to sell for as much as $18 million.
"Fears about the market's health and liquidity do have an effect on us somewhere down the line," Mr. Ruprecht said, "but 2007 was an awfully good year for us."