Auction Houses Jockey to Lead Sales in First Big Market Test

  • Christie's, Sotheby's, Phillips compete for prime time slots
  • Record $2.7 billion of art was sold in two weeks in May

Art auctions used to be a gentlemen’s business. Now the gloves are off.

As art sales face their first major test since the August financial market rout, auction houses are jockeying not only for trophy artworks but also for the best positions to highlight them at the November auctions in New York. The result is a shakeup in a schedule that for years was tightly coordinated, with Christie’s and Sotheby’s traditionally alternating who goes first. Even the weekends are no longer off limits; in a surprising move, Phillips, the smallest of the three, switched its main sale to a Sunday.

"Nu couché" by Amedeo Modigliani

Source: Christie's

“It is ruthless out there,” said Wendy Cromwell, a New York-based art adviser. “You need to do what you need to do in order to get the consignments you want.”

A prominent position on the schedule is latest weapon in the arsenal auction houses use to outmaneuver rivals that includes guarantees, special catalogs and global tours. Like those tactics, scheduling is used to help win trophy artworks, which, in turn, generate buzz and attract buyers. The stakes at the bellwether auctions are higher than ever: in May a record $2.7 billion of art was sold. With stock markets off their highs and volatility surging, prospects of a repeat may be dimming.

The increased competition reflects auction houses in flux, each under new leadership. Sotheby’s Chief Executive Officer Tad Smith, who started in March, is trying to take on Christie’s, which has dominated the market’s biggest segment of postwar and contemporary art. Christie’s, the world’s leading auction house by revenue, wants to maintain its dominance by repeating the success of May when it sold record $1.7 billion of art in just one week in New York. Boutique auctioneer Phillips is seeking to challenge the two market leaders under CEO Ed Dolman, who ran Christie’s for 10 years.

Special Sale

The owner of Amedeo Modigliani’s 1917 painting “Nu Couche (Recling Nude") agreed to part with the piece, estimated at more than $100 million, after Christie’s organized an additional curated sale around the work, the auction house said. “The Artist’s Muse” auction on Nov. 9 will include about 30 artworks.

Sotheby’s won the $500 million art trove of its former chairman A. Alfred Taubman with a pitch that included four stand-alone sales, starting with the additional evening sale on Nov. 4 called “Masterworks.”

A. Alfred Taubman

Source: Taubman Family

For years, the auction houses coordinated their big evening sales in New York during two weeks in early May and November. Impressionist and modern art sales took place in the first week, with postwar and contemporary auctions slated the following week. The events took place on Tuesdays and Wednesdays, with Christie’s and Sotheby’s alternating who goes first every season. Phillips, which only sold contemporary art, alternated between Mondays and Thursdays in the second week.

In May, Christie’s upended this order by squeezing all its auctions into a single week and adding an extra blockbuster sale spanning the entire 20th century.

Christie’s approach paid off as the auction house walked away the winner, selling the world’s most expensive artwork at auction, Pablo Picasso’s “Les Femmes d’Alger” painting that fetched $179.4 million.

Big Rush

The new schedule meant that Christie’s moved its Impressionist and modern art sale to the same day as Phillips’s evening sale of contemporary art. Phillips delayed the start of its event to give exhausted collectors and dealers time to rush over to its Park Avenue salesroom from Christie’s Rockefeller Center headquarters.

“All bets are off since last season,” said Michael Plummer, a principal in Artvest Partners in New York and co-director of Spring Masters New York art fair. “Christie’s is pursuing its strategy.”

In November Christie’s again jammed its sales into one week, clashing with Phillips on Nov. 12. Sotheby’s is sticking to the traditional schedule, but adding extra sales from the Taubman estate.

Phillips, scrambling to carve out a special time slot to launch its hybrid auction of modern and contemporary art, is moving its event to Nov. 8, Sunday, a day the auction houses use to host lavish client brunches and dinners, not sales.

“This will ensure the sale can take place at a dedicated time within a demanding auction schedule in New York in November,” Phillips said in a statement. Christie’s declined to comment on its schedule or the Phillips move. Sotheby’s declined to comment.

Mobile Bidding

Experimental scheduling may benefit from new technology that allows collectors to participate remotely, watching and biding live on their mobile devices from anywhere in the world, on weekdays or weekends.

“The traditional calendar doesn’t matter anymore because everyone is wired and plugged in all the time,” said Suzanne Gyorgy, head of art advisory and finance at New York-based Citigroup Inc.’s Citi Private Bank.

The auction houses may have a bigger worry if the art market follows the volatile financial markets.

“All this is happening because the market is in a very strong cycle,” Todd Levin, director of New York-based Levin Art Group, who advises collectors, said about the packed auction calendar. “The engine that drives this is demand. If the market corrects itself, all of this will go away and it will go away very quickly.”

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