20th-Century Designs Draw Collectors
A year ago, Chicago's Wright Auctions, a six-year-old auction house specializing in 20th century furniture and other design objects, saw $6.1 million in total revenues from its year-end December auction. Fast forward: A parallel auction on December 3, 2006, hit more than $10 million in sales. (Sales figures quoted include the 20% buyers' premiums paid to the auction house. Sellers pay a 15% commission.)
Granted, one sale included an entire home: A classic, modernist Case Study House by architect Pierre Koenig, restored to mint condition, sold for about $3 million. In any case, Wright has seen consistent growth in total sales in the last year. "We're up about 40% in total sales from last year. We'll reach about $25 million for 2006," says Richard Wright, the founder of the auction house and a longtime private dealer of 20th-century objects. In other words, the market for rare, collectible works of 20th-century design is heating up.
This month, the world's top three auction houses are expecting record sales at auctions of 20th-century design. One reason for the high expectations: In June, 2006, a 20-year-old aluminum chaise by Australian-born industrial designer Marc Newson fetched $968,000 at Sotheby's in New York. This sum was the highest amount ever paid for a piece of furniture by a living designer. Based on that sale, collectors, dealers, and auction-house specialists alike are banking on the rising market value of contemporary design.
Moving Into History
On Dec. 14, Phillips de Pury will hold a sale titled Design &Design Art, focusing on 20th-century furniture and decorative objects. Sotheby's will host a sale of "important 20th century design" on Dec. 15. And then on Dec. 18 and 19, Christie's will present, in a series of six auctions, the largest selection of 20th-century decorative art and design ever to be offered from its New York outpost. At Christie's, the largest sale of the season, more than 900 objects, is expected to break the $20 million barrier from the six planned auctions.
The interest in modern and contemporary design—what the experts label as "post-war,"—as in "made after World War II,"—objects among buyers who can shell out six figures for a rare table or chair is a relatively recent phenomenon. James Zemaitis, director of Sotheby's 20th Century Design department (and formerly of Phillips) says it was in 2000 and 2001 that collector interest in furniture of this period started to gain momentum. Why? To put it bluntly, the 20th century ended and the 21st began, and suddenly these objects became historical and of the previous era.
In the past, the rich bought antiques—Chippendale furniture, for instance—for their rarity and their historical significance. More recently, however, even top collectors recognized for the holdings of antique furniture they have amassed—such as Marie-Josée Kravis, president of New York's Museum of Modern Art and the wife of Henry Kravis, co-founder of the private equity firm Kohlberg Kravis Roberts & Co.—have bought newer furniture.
A sinuous, limited-edition wood piece, the Cinderella Table, which was designed in 2004 by designer Jeroen Johan Verhoeven was given to MoMA's permanent collection by Mrs. Kravis, who is usually identified as a major collector of traditional French furniture. The gift indicates that she indeed has bought pieces by living designers, even if she's now donating them to an institution.
Museums such as MoMA can be seen as playing a role in the valuation of design objects. Once an object is in an institutional collection, it's as if it bears an imprimatur, a sort of "safe buying" guarantee for collectors concerned with market value. Perhaps not coincidentally, an edition of the Cinderella Table is expected to fetch an impressive $40,000 to $60,000 at Sotheby's this week.
Paola Antonelli, MoMa's design curator, says that the idea of collecting rare contemporary furniture really isn't that new, despite the current hype among auction houses and increased interest among collectors.
Art institutions such as MoMA are barometers of which artists, designers, and individual works are the most historically significant—and MoMA, in particular, has been collecting modern and contemporary design objects for nearly 80 years.
Collectors look to museums such as MoMA to see which designers' works they're buying or receiving as gifts from prominent collectors—and editions of the same pieces of furniture can be considered to have higher market value if in a museum collection.
"MoMA has always had a predilection for design, ever since it was founded in 1929," writes Antonelli in an e-mail. "We have a florid and enthusiastic architecture and design committee and several trustees who love to not only collect, but also use great design. Some of them are the ones that set the direction for everybody else to follow."
But many experts say it's newer and younger collectors who are fueling the craze for 20th-century furniture. They see a parallel with the market for modern and contemporary art, which has been shattering sales records at the same venues where this month's big design auctions will be held—Phillips, Christie's, and Sotheby's.
One of a Kind Collecting
Paintings by the late Andy Warhol, for example, have fetched eight figures in recent years, while works by 41-year-old artist Damien Hirst have sold for seven or even eight figures at auction. Many observers see post-war design as a logical new collecting frontier that might appeal to the buyers of these works, or those who would like to buy a Warhol or a Hirst, but perhaps might be more interested in the next big thing, even beyond art, that's relatively affordable and will appreciate in value.
"These collectors look at design and understand that they can get a historic piece for say, $200,000, one that's so rare that there are only one or two [of them] in the world," says Marcus Tremonto, the senior specialist in the design department of Phillips de Pury.
"Collectors who are new to the art market appreciate the design market. Design offers accessibility for them," Tremonto continues. "When they go to a contemporary art sale, they see young artists just out of art school selling paintings for $2.5 million. Established contemporary artists can now sell canvases for $7 million."
Clients in Common
Today, major contemporary art collectors such as Coach (COH) president Reed Krakoff, Miami real estate developer Craig Robins, former Wall Street commodities trader Robert Rubin (not to be confused with the former U.S. Treasury Secretary), and Greek industrialist Dakis Joannou, also collect 20th-century design.
"About 90% of my clients are also contemporary art collectors," says Sotheby's Zemaitis. The situation is similar at rival Christie's. "I'm speaking at least eight to 10 times a day with the contemporary art department here at Christie's. We share lots of clients in common. It's because collectors are now really creating environments, unified wholes," says Joshua Holdeman, department head of 20th Century Decorative Art & Design at Christie's.
In other words, he sees art collectors searching for, say, a boxy bed by minimalist sculptor Donald Judd to coordinate with actual geometric sculptures by the same artist, or perhaps a collector's decorator wants to pair a curvy limited-edition chair by hip designer Ron Arad with a canvas depicting abstract nudes by contemporary art star Cecily Brown.
Antiques for a New Generation
Wright, however, believes that consumers, even those wealthy enough to afford a $100,000 Noguchi table, are more aware than ever of the power of design, generally speaking. And this awareness of design translates into a greater comfort and ease in the bidding room. In other words, today's collectors understand the mere pleasure of and respect for well-designed functional objects of any era. Wright attributes this contemporary design-conscious sensibility to the influence of more pedestrian, ubiquitous references, such as Apple's (AAPL) sleek iPod.
Others see post-war design as simply coming of age as antiques for a new generation of collectors. "People consistently want the best of the last century. Collectors already own Tiffany lamps. They see the best furniture at museums. What's left? Furniture that was made after 1945," says Zesty Meyers, co-owner of New York's R 20th Century, a gallery that specializes in mid-20th century design.
"Hopefully people are smart enough to hold their pieces for 20 to 30 years, rather than reselling quickly," Meyers adds. At that point, the finest examples of limited-edition furniture made in the 1950s up through the early 2000s will most likely rise in value, as they will then become part of the next generation of historical design.
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