The Art Market May Be On Its Way Back

Art lovers who dropped by the Berry-Hill Galleries booth at the fourth annual Art Dealers Assn. Art Show got more than a look at works by many major American artists. They also got fortune cookies. "Buyeth a Wyeth," read the message in one. "Bierstadt is the one to have when you're having only one," "Goodfellows, buy Bellows," and "Find love at last with a Prendergast" were among the 25 artful fortunes.

In an art world depressed by slumping sales and weak prices, such playfulness might seem out of place. But as things turned eut, the high spirits were right on the money. Although attendance at the show, which ran from Feb. 27 to Mar. 2, was down 8% from 1991, those who did come wrote more checks this year than last, when the Persian Gulf war deepened the art market's gloom.

GOOD OMENS. And this year's opening gala drew more, not fewer, of the big collectors, including Henry Kravis, the senior David Rockefeller, actor Steve Martin, and PaineWebber Inc. Chief Executive Donald Marron. All told, 51 of 64 exhibitors sold art during the show, including several works priced near $1 million. Says gallery Director James Berry Hill: "The mood has changed--it was definitely upbeat. People were looking to buy."

The shift in sentiment is leading some market watchers to utter the word "upturn." While a more successful art show in itself wouldn't be a big enough portent, there are other positive omens. In January, sales at the second annual Miami art fair more than doubled, to over $20 million, thanks in part to the presence of many Latin American works, a burgeoning segment. And both Christie's and Sotheby's notched good results at their February auctions of Impressionist, modern, and contemporary paintings in New York. Each sold some 90% of the works on the block and took in totals within the presale estimates. That's a far cry from their 1991 sales, when 30% or more of the works went unsold.

Better yet, says Diane Upright, head of the contemporary art department at Christie's, "dealers were buying, and that's a good sign." That means galleries are willing to add to their inventory. Sotheby's, too, saw strong dealer buying. Says David J. Nash, head of Sotheby's paintings division: "There's a growing sense that prices will not drift lower."

No one predicts a return to the sizzling '80s anytime soon. In most cases, prices for paintings are off some 30% to 40% from their 1989 peak, and the lower-priced works are selling best. For paintings valued at more than $1 million, the market remains thin for all but the most exceptional works. Volume is up, but not spectacularly. New York dealer James Goodman, for example, now is selling 10 to 12 paintings a month--an increase from four about six months ago, but still a far cry from the 30 to 40 paintings he sold each month in the late '80s.

Even so, there's an optimism in the art world that wasn't there last fall. Both dealers and auctioneers are talking about a stable base to build on. Some even are looking forward with hope instead of dread to the big, bellwether New York paintings auctions in May. At the New York art show, Upright said consignments for the auctions are good and added: "They'll be better after this show." Right now, the most expensive item on the block is Georges Braque's Atelier VIII, estimated to bring in $6 million to $8 million.

If Upright is correct--and consignments do pick up--that would be another good sign. That's because the auction business is supply-driven: The better the art that's on the block, the more likely it is to sell well. And good spring sales, in turn, could infuse the art world with confidence. Although any big surge will require a growing economy, a shot of confidence would go a long way toward putting the art world back on a slow ascent to the levels of the boom years.

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