June 24 (Bloomberg) -- Sotheby's Holdings Inc. sold Frank Auerbach's 1983 portrait, ``Head of J.Y.M. II,'' for 352,800 pounds, including the auctioneer's commission, nearly four times its estimated value at a London auction of contemporary art last night. The sale broke records for artists Paula Rego and Friedensreich Hundertwasser.

Buyers snatched up 90 percent of the works offered by Tobias Meyer, auctioneer for New York-based Sotheby's, in a sale that took in 14.1 million pounds ($25.6 million). Three slashed canvases by Lucio Fontana sold for more than their estimated worth, along with a coffin made by Tracey Emin.

While earlier paintings by Amedeo Modigliani and Pablo Picasso set the top prices, auctioneers can draw triple the number of bids for works done in the past 60 years by artists ranging from Francis Bacon to Jean-Michel Basquiat. Eighteen bidders on the telephones and in the room on New Bond Street competed for Auerbach's portrait.

``Contemporary art is where most of the activity is,'' said Paul Gray of Richard Gray Gallery in Chicago, who bought ``Modern Painting,'' a 1967 triptych by Roy Lichtenstein, for 733,600 pounds. A younger generation of bankers and entrepreneurs is seeking art it can relate to, ``So it's not surprising it's a strong market,'' he said.

Sotheby's sale came on the third day of a week of London summer auctions of Impressionist, Modern and Contemporary art that is expected to fetch a total of as much as 180 million pounds. Sotheby's top-priced work last night was ``Untitled,'' Basquiat's 1982 acrylic painting featuring an African mask on a background of graffiti. It sold for 2.5 million pounds, at the top of Sotheby's estimate, to an undisclosed buyer.

Price Trebles

Prices of the 25 percent most expensive Contemporary works have more than trebled since 1997, according to an index produced by Art Market Research, a London data company. This is forcing dealers, who must make a profit on their purchases, to hold back from paying top prices.

``Everybody wants Contemporary art,'' said Paolo Vedovi of Galerie Odermatt-Vedovi in Paris, who bid unsuccessfully on works by Fontana and Bacon, currently on show at Paris's Musee Maillol. ``It's difficult for dealers to buy.''

At Christie's sale of Impressionist and Modern art on Tuesday night, one-third of the works failed to sell.

Bacon's 1973 ``Study for Self-Portrait,'' valued at as much as 800,000 pounds, was bid up last night to 1.6 million pounds. Andy Warhol's ``Little Electric Chair,'' a 1964 work, fetched 901,600 pounds, and Fontana's 1960 ``Concetto Spaziale, Natura,'' a rock-like bronze sculpture, sold for 543,200 pounds.

The biggest price jumps were for artists such as Auerbach, born in Berlin in 1931, and Rego who had fallen behind the levels commanded by more popular artists, auctioneer Meyer said at a press conference after the sale.

``People are starting to realize they must have a move, and the news travels fast,'' he said. By contrast, German artist Gerhard Richter's ``Helen,'' a blurry 1964 oil portrait of a smiling woman in a strapless dress that was valued as high as 1.2 million pounds, failed to sell.

Auerbach Portrait

Painting his portrait, Auerbach squeezed black and white oil paint from the tube onto canvas to show the head of his model Juliet Yardley Mills held at an angle. With Bacon, he is one of the so-called School of London artists who paint faces instead of geometric shapes and patterns.

Warhol's ``Four Marilyns,'' a 1986 painting in acrylic and silkscreen ink showing Marilyn Monroe's face, was bought by London dealer Ben Brown for 296,800 pounds, compared with a top estimate of 280,000 pounds. He wouldn't say if it was for a client.

Sotheby's second lot was ``The Sweeper'' by Rego, born in Lisbon in 1935. The work from 2000, in pastels and mounted on aluminum, shows a woman in a pink dress leaning on a broom. The high estimate was 70,000 pounds, and it fetched 117,600 pounds. Rego's previous record price was 84,000 pounds. The artist, whose paintings hang in Charles Saatchi's art gallery in London, is being ``re-evaluated,'' said Cheyenne Westphal, Sotheby's head of Contemporary art.

Hundertwasser's 1959 ``La Tour de Babel'' painting in red and yellow sold for 274,400 pounds. The work had been valued as high as 90,000 pounds and the Austrian artist's previous record was 146,750 pounds.

On top of the hammer prices, Sotheby's adds a commission of 20 percent for the first 70,000 pounds of an item and 12 percent on the rest of the hammer price.

London-based Christie's said its sale of works from the past 60 years, set for this evening, is expected to bring as much as 15.7 million pounds, compared with 9.3 million pounds last year.

To contact the reporter on this story: Linda Sandler in London at lsandler@bloomberg.net.

Last Updated: June 24, 2004 04:59 EDT