Slow sales at art auctions may be sign of sanity

NEW YORK - The sagging demand for high-end art at the fall auctions could signal a return to more realistic prices in the fine art market after the frenzied buying of the last few years.

That’s the consensus of some art experts who say the lower prices and unsold works at Sotheby’s and Christie’s over the past two weeks may be a healthy development.

“The truth is that for serious collectors with vision and some cash, this is an opportune time to buy important works of art for more reasonable prices,” said Jo Backer Laird, a former general counsel at Christie’s, now with the law firm Patterson Belknap Webb & Tyler.

In contrast to previous years when it’s been standing room only, the auction houses had empty seats at their sales of impressionist, modern, postwar and contemporary art.

Many works failed to attract even a single buyer — among them, Francis Bacon’s “Study for Self-Portrait,” estimated at $40 million — or sold below their estimates.

Still, the picture wasn’t totally bleak.

Kazimir Malevich’s “Suprematist Composition” sold for $60 million, setting a record for the artist and for any Russian artwork sold at auction.

And while prices were down 25 to 35 percent overall, according to art consultant David Nash, there were some very significant sales, including $20.8 million for Juan Gris’ “Book, Pipe and Glasses” and $18 million for Pablo Picasso’s “Two figures (Marie-Therese and her sister reading).”

The fall auctions serve as a barometer of the art market because they attract buyers from all over the world.

For the two-week period, Sotheby’s reported taking in a total of $411.5 million, under its low estimate of $688.4 million, and selling 448 lots out of 866. Christie’s reported a total of $374.5 million, below its $686.7 million low estimate. It sold 630 items out of 990.

“In light of the financial turmoil, Sotheby’s and Christie’s did a very good job of persuading sellers to recognize the climate in the market and put on much lower reserves than they had agreed to,” said Nash of the Mitchell-Innes & Nash gallery.

The reserve is the lowest undisclosed price the consignor agrees to sell a work.

Megan Fox Kelly, who runs a Madison Avenue art advisory firm, said the auction results marked a correction in price levels and collectors’ expectations rather than a “dramatic or disastrous downturn.”

“When a very sophisticated Yves Klein sells for $21 million and a beautiful John Currin draws excited bidding that pushed it past its high estimate, we see a level of strength in the market and a level of discernment and connoisseurship among collectors,” she said.

Prices have risen sharply for contemporary art over the past two years, with Bacon’s “Triptych, 1976” selling for $86.2 million to Russian billionaire Roman Abramovich in May and a group of works by Damien Hirst fetching almost $200 million at a London auction in September.

According to Nash, that frenzied buying has kept away a number of serious collectors such as financier Eli Broad and Gap clothing founder Don Fisher, who have jumped back in and were seen at the recent auctions.

“I’m very impressed with the way the market has stabilized,” he said. “It’s at a lower level but it’s a real market.”

That was underscored on Wednesday when Christie’s offered 16 postwar works on paper from the private collection of Richard Fuld, who was forced out as CEO of bankrupt investment bank Lehman Brothers and denied severance and a bonus.

The collection reportedly sold for $13.5 million.

Even before the sales got under way, the jittery economy foreshadowed what lay ahead. A week before the start of the auctions, Sotheby’s abruptly withdrew a Picasso painting that had been expected to sell for $30 million.

Just this week the auction house Phillips de Pury & Co. withdrew five contemporary artworks, including ones by Currin and Richard Prince.

Of the 51 works offered, 40 percent went unsold and only one sold for more than $1 million.

The sale’s total take was $9.6 million, less than half the $23 million low estimate.

Nash said the number of buyers has shrunk considerably since spring.

Nonetheless, he noted that $470 million worth of impressionist and modern paintings changed hands at Sotheby’s and Christie’s.

And while many prices were lower, “in a way this is a healthy development,” he said. “I think that the excesses of the last two years have really evaporated.”

Last week, Sotheby’s chief executive Bill Ruprecht predicted that going forward, “We will be meaningfully profitable at significantly lower sales levels even during these uncertain times.”