September 2015: Spring/ Summer 2015 Art Market Report

An untitled wooden work by Louise Nevelson sold at Christie’s First Open/ NYC Summer Sale in July.

September 2015: Spring/ Summer Art Market Report

By SHIREEN LOHRASBE, SEPT. 2015

IN LATE JULY ARTNET RELEASED A REPORT for Q2 2015. For the first half of the year, the total value of the global art market reached $8.1 Billion, down 6% from 2014 ($8.6 Billion). “Despite the overall decline, the US market experienced significant growth during the entire six month period—spanning both the first and second quarters. The total sales value for the US was $3.4 billion, up from $2.9 billion in 2014.”

ARTPRICE, IN PARTNERHSIP WITH CHINESE-BASED ARTRON AND AMMA, also published market data. “For the first six months of 2015, global turnover from Fine Art auction sales amounted to US$7.6 billion compared with US$8 billion in the first half (H1) of 2014.”

Moreover, the report claims the United States has dethrowned China in terms of total value of artworks sold per country. “At a global level, the United States generated nearly 30% of the world’s Fine Art turnover on just 12% of the total number of lots sold…" The US Art Market posted a +20% increase in turnover on an almost stable transaction volume (+2%). At a global level, the United States generated nearly 30% of the world’s Fine Art turnover on just 12% of the total number of lots sold.” On the other hand, China’s reign stopped short. “Having progressed +214% between 2009 and 2014, China’s public Art Market posted a sharp fall in the first half of 2015. The number of lots sold decreased -39%. Chinese Fine Art auction turnover contracted a little less at -30% versus H1 2014. The growth of the Chinese auction market has therefore stalled, but the government’s anti-corruption drive is more than likely one of the causes.” Furthermore, Shanghai Composite Exchange has reached its lowest level in eight years—the global impact and consequences are to be determined.

PHILLIP DE PURY’S FORMER chairman Simon de Pury is set to debut an online art auction platform aptly named “de Pury.” De Pury is launching in partnership with Mallett international gallery business with backing from internet investor Klaus Hommels. The first auction is scheduled for October 15 and includes a 400+ lot sale of fine art and antique furniture from the Lambert Art Collection.

BERLIN BASED AUCTIONATA—another online auction platform that launched in 2012—experienced 195% growth over the first half of 2015 from 2014. The company also disclosed that its GMV (gross merchandise volume) is €35.7 Million/ US $39.7 Million. Auctionata is officially Germany's largest auction house in terms of revenue and size of staff of which 80% of the GMV is generated via Livestream auction.

MID-MAY’S SERIES OF ART AUCTIONS IN NEW YORK achieved new records. The cumulative day and evening sales of contemporary as well as impressionist and modern art tallied an astonishing $2.7 Billionat Christie’s, Sotheby’s and Phillips, within a 48-hour period. The series generated much buzz as it coincided with Frieze New York right before the 56th Venice Biennale. Geoffrey Smith at Fortune detailed the top lots: “At the Christie’s auction, a cubist work by Pablo Picasso, ‘Les Femmes d’Alger (Version O)’ had set a new world record for any painting sold at auction, fetching $179.9 million… Rothko’s ‘Untitled (Yellow and Blue) sold for $46.5 million, while Liechtenstein’s ‘The Ring (Engagement)’ went for $41.7 million, largely in line with expectations. A characteristic abstract work by Pollock from 1950 raised $18.3 million. The main surprise of the evening was Christopher Wool’s ‘Untitled (RIoT)’, which went for $29.9 million, double its pre-sale low estimate and a new record for the artist.”

CHRISTIE’S AND SOTHEBY’S IMPRESSIONIST AND MODERN art evening sales in London totaled $395 Million, late June. While the numbers are impressive, the rival auction houses Sotheby’s and Christie’s traded places (Sotheby’s Imp-Mod totals increased whereas Christie’s totals decreased).

Eileen Kinsella at Artnet News wrote: “Having dominated the Postwar and contemporary realm in recent seasons with jaw-dropping totals for evening sales—such as this past fall's $852.9 million auction in New York—Christie's London Impressionist and modern art market share continues to decline, while Sotheby's is on the rise. Christie's June 23 London evening sale of Impressionist art pulled in £71.5 million (about $113 million), its lowest total in the past four years.” Comparatively, Sotheby's June sale in London realized £178.6 Million/$282 Million—the highest in years. “The comparable evening total this past February was $280 million, $207 million in June 2014, and $266 million in February 2014.”

CHRISTIE’S FIRST OPEN/ NYC SUMMER SALE realized USD$5,792,562, late July. Though prices of the mid-season sale were considerably lower than its equivalent evening sales, most lots far surpassed their respective pre-estimates. The top lot—an oil on canvas by Milton Resnick earned $173,000 with a $30-40,000 pre-estimate. A black wooden sculpture by Louise Nevelson realized $161,000 with a $30-50K pre-estimate.

THE INAUGURAL SEATTLE ART FAIR transpired July 30–August 2, to rave reviews and impressive attendance (approximately 15,000 visitors). Co-produced by Art Market Productions and Vulcan Inc.—an investment company owned by billionaire Paul Allen—the fair pulled both art world veterans and new collectors such as technology entrepreneurs. The four-day fair presented an estimated $250 Million of contemporary art The Seattle Art Fair’s well-attended opening night preview raised over $85,000 for the “Artist Trust.”

SKATE’S GLOBAL ART-LOANS report released in July. The report includes information polled from 24 art-lending practitioners and private banks, and predicts a 20% increase in art-loans this year. According to the Executive Summary, “Art-lending business is booming, with the 2015 art-loans book scheduled to grow above $10 billion this year, which is at least twice the level of the art-lending market last reviewed by Skate’s in 2011. This still leaves ample room for growth, as Skate’s most conservative estimate of the addressable art-lending market size is $100 billion.” Furthermore, the report claims, “The United States is the world’s largest, most transparent, and most efficient market for art lending and is already overbanked in the high-end premium private credit segment, with tenors sometimes exceeding three years and interest rates often at 2% or lower for AAA-credit private borrowers.”

SKATE’S RELEASED ANOTHER REPORT titled “Global Art Trade: Four Reasons for More Growth to Come.” Firstly, the number of Ultra-High Net-Worth Individuals entering and participating in the global art trade is increasing. Secondly there’s more leverage available in the art lending business. Thirdly, though the Chinese market has decreased significantly with its currency issues, the country’s government is intervening via its main auction house Poly International. “Controlled by Chinese Government–owned Poly Group, Poly Culture Group is actively used to intervene in the Chinese art market as an active buyer of art. It does so by stocking up its inventory and expanding its art investment fund activity. Skate’s has already extensively covered the 82% surge in Poly’s art inventories in 2014.” And lastly, the online market for art trading is booming (think Auctionata).

SOTHEBY’S IS MAKING A CONCERTED EFFORT to support the Indian Market. New, extensive programming and educational services support the 9% surge in clients (from 2013–14, data for 2014–2015 to be announced). Sotheby’s was the first international auction house to hold sales in the country (1992) and has conducted over USD$600 Million in transactions in India to-date.

FORECASTS FOR THE UPCOMING SALES SEASON remain quiet. Since Shanghai’s Composite Index of Shares dropped by 35% from June, stock markets across the globe have destabilized. Likely, older, traditional artworks (such as Old Masters) with provenance and long tack records will become become more favourable than flashier, trendier contemporary names thus shifting the focus of the auction houses. WM