NEW YORK -- It looked like a scene out of the movies, but the white Rolls-Royce that pulled up curbside at Sotheby's on the stormy evening of May 17 was not a prop. Neatly cutting off rush hour traffic at East 72nd Street, the chauffeur emerged and guided the three Japanese occupants to the auction house door, ignoring the angry chorus of car horns.
That evening, Japanese buyers -- primarily dealers but including private collectors -- purchased $185 million of the record $286 million worth of artwork sold, taking home 65 percent of the art auctioned. That includes the $78.1 million fetched for Renoir's "At the Moulin de la Galette," bought by the Japanese paper mogul Ryoei Saito. The same man paid $82.5 million for van Gogh's fabulous "Portrait of Dr. Gachet" at Christie's two nights before.
Sotheby's was not the exception in attracting record numbers of Japanese bidders, both in person and via telephone. At Christie's, the Japanese dominated the buying, cutting a massive 57 percent of the art pie, collectively shelling out $154.8 million of the $269.4 million sold.
That picture takes on even greater significance with Christie's tabulating Japanese participation in the two May weeks of contemporary, modern and impressionist sales to the tune of $200.2 million, representing 52 percent of all artwork sold.
Before Saito was identified in headlines the world over as the buyer of the Renoir, his agent, Hideto Kobayashi, bid for the painting from a telephone in one of Sotheby's executive suites, above the fray of the salesroom. Kobayashi had learned his lesson two nights earlier after being hounded by a pack of journalists at Christie's. And so he and his entourage went undercover.
That low-profile style was the opposite of that of Kazuo Fujii, head of Tokyo's Fujii Gallery, who was bidding with gusto in the packed salesroom. When interested in an artwork, Fujii kept his bidding arm straight up, not bothering to lower it as etiquette demands for a competitor's bid. At Sotheby's, an associate sitting behind Fujii raised the gallery's identifying auction paddle at the sound of the auctioneer's hammer, indicating another artwork bought for Fujii's huge inventory.
Fujii used to stand up during the sales to take photos of bids with his pocket camera. This time he bought a reported $30 million worth of art at the two houses, including the Art Institute of Chicago's deaccessioned Degas pastel "Preparation for the Class" for $4.95 million. He also bought a Pissarro for $1.76 million and a Miro for $4.07 million, also at Sotheby's. Always seeming to take delight in the action, Fujii could be seen holding up and studying a transparency of an upcoming picture during the sale.
Gallery Urban was another major player in the auction room this time around. While frankly stating, "We don't like to be called a Japanese gallery," its director, Marazina Marzetti, said the six-year-old gallery was started in Tokyo and has branches in Nagoya, Japan, Paris and New York.
Gallery Urban bought approximately $16.8 million worth of art during the two evenings of impressionist sales. Among its prizes: a Matisse, "Vase of Amaryllis," going for $3.3 million at Sotheby's; and a fine Monet, "Meadow at Giverny," for $2.42 million at Christie's. The gallery also purchased a huge marble Henry Moore sculpture, deaccessioned by the Maryland Institute of Art, for $2.42 million.
"I was trying to buy many things," commented Marzetti in a phone interview, "but ended up buying not so many. For the first time the Japanese were seriously prepared to sustain the market. I think that's good, but it can't always depend on the Japanese. Japanese dealers were not ready to see the market they've so heavily invested in collapsing. They were there to protect their investments."
Marzetti said the Japanese were bidding very differently from two years ago, "when everything was sold at crazy prices no matter what the quality. At one time they weren't even looking at the condition of a painting and would buy on the strength of an Ektachrome."
Nationalistic buying blocs aside, when you add up all of the figures achieved at the two auction houses during the past two weeks of sales, you get $891,088,555. Of that monster figure, Sotheby's accounted for $508.6 million while Christies toted up 382.5 million. Numerically speaking, it's difficult to conjure up a recession or significant softening of the market with these hard currency figures.
Still, they did not meet pre-sale predictions of breaking the billion-dollar barrier in the two-week buying marathon. Buy-in rates -- the percentage of artworks failing to sell at their predetermined minimum "reserve" prices -- were higher at both houses this time, with Christie's registering a hefty 24 works unsold out of the 81 offered, a 30 percent failure rate at the evening impressionist sale. At Sotheby's contemporary evening sale, 32 out of 88 artworks didn't sell, a 36 percent buy-in rate.
More ominous than the unsold works were the ones that met their reserves and sold, but still fell below their low estimates printed in the auction catalogues. The Art Institute's deaccessioned Monet, "Saint-Georges Majeur," went for a hammer price -- before the 10 percent buyer's premium was tacked on -- of $6 million, way under its $7 million to $9 million estimate.
By "guaranteeing" artworks, the auction house contractually assures the consignor a minimum price whether or not it sells. Another Art Institute painting that was guaranteed, Pierre Bonnard's "Red Flowers," sold for a hammer price of $1 million, again shy of its $1.5 million to $2 million estimate.
Estimates are the name of the game, and differences on either the low or the high end give fairly clear indications of changing market conditions. The auction houses have taken considerable flak lately -- especially from competing art dealers -- for generating a climate of "estimate inflation."
There is no question -- even auction house principals admit it -- that some softening of the market has occurred. The roller-coaster ride of the last two years has slowed down to less than breakneck speed. The few exceptions -- the spectacular van Gogh and the exuberant Renoir -- have to be viewed as isolated Olympians, far above the crowd.
As veteran Madison Avenue dealer Klaus Perls says, "The gulf in price between the regular-merchandise pictures and the very, very fine things that come on the market gets bigger and bigger." Despite his disclaimer that as a dealer he can't afford to buy pictures in the auction arena, Perls caught the fever at Sotheby's and bought the Guggenheim Museum's deaccessioned Modigliani, "Boy in a Blue Jacket," for $11.55 million.
It helps to compare prices from earlier landmark sales to get a grip on the current state of affairs. Consider Christie's single-owner sale of May 1980 when "10 important paintings from the collection of Henry Ford II" went on the block in New York. At a time when million-dollar pictures were still a rarity, van Gogh's striking "The Poet's Garden," painted in 1888 to honor the arrival in Arles of his friend Gauguin, sold for $5.72 million. Another van Gogh from the same series, "The Public Garden," fetched $2.09 million. In all, the 10 pictures snared $20.2 million, roughly the same price paid for one van Gogh painting, "The Bridge at Trinquetaille," in 1987 at Christie's London. That painting was consigned by the estate of New York collector Siegfried Kramarsky, which most recently put up "Dr. Gachet."
Before the Ford sale, the record for a van Gogh at auction was $903,000, set at Christie's London in July 1979 by "The Cemetery at Arles" from 1888. That price sounds as unbelievable today as imagining "Irises" hanging in regal obscurity -- as it did -- in the Joan Whitney Payson Gallery of Art at Westbrook College in Maine before the family consigned it to Sotheby's. Insurance has never been the same.
Asked to interpret the recent results at Christie's, the house's impressionist painting expert and senior vice president Michael Findlay said, "One could say that the market -- the shape of it -- has returned to normal ... having gorged itself, it's pausing to digest." Findlay estimated that the average rise for impressionist paintings over the last 30 years has been 12 percent a year.
"If you have a rise of 20 percent or 25 percent a year as we've had in the last two years, you then need a compensating period where perhaps they don't rise and remain the same," Findlay said. We'll be estimating things the same as they are now for maybe another year or 18 months. Then I think you'll see the regular 12 percent rise, and then in another eight years we'll have another boom."
Findlay explained that he reappraised an art collection for insurance purposes following last week's sales and "very selectively" moved up in value a Renoir and a Degas out of the 10 items in the collection. "In normal times, one wouldn't even think about revising figures for at least two years. But in the period we've just seen, people were requesting reappraisals every six months or every time there was a sale. It drove us crazy. It was as if we were literally the Dow Jones."
Across town at Sotheby's, David Nash, senior vice president and head of fine art, said: "Every market has its ups and downs. It's important to separate out the van Gogh and the Renoir for any normal observations of the market. Clearly, these were not normal market conditions. I certainly wouldn't call it a recession, but we'll have to take into account the downside in future estimates." Nash was responding to the figure of 17 out of the 70 artworks offered at Sotheby's during their evening sale that sold for under the low estimates printed in the auction catalogue.
Nash said that estimates for certain artists would be shaved in future sales by "not much more" than 10 percent. He noted that even after taking away the blockbuster Renoir from the results, Sotheby's sold $208 million worth of art, comfortably in line with its presale estimate of $172 million to $234 million.
With a large number of museum-deaccessioned works disappearing to foreign shores and uncertain future access to public viewing, it is heartening to note that the proceeds from 10 works of art deaccessioned by the Art Institute this month at Christie's and Sotheby's will help pay for the museum acquisition of a famous Brancusi sculpture, "Golden Bird," from 1919.
The Art Institute agreed to pay the Arts Club of Chicago $12 million over 10 years. The Brancusi is currently in storage at the museum and is expected to be unveiled next February when the museum's 20th-century galleries reopen after renovation.
"It is extremely important to save this superb sculpture for the city," said James N. Wood, director of the museum. "To let it leave is unthinkable. The Art Institute is the only institution in the city which can assure that it remains here on public view."
As Findlay says, "It's all a numbers game." It is true that the market sagged a bit this time around -- despite the dizzying figures -- retrenching for the moment to catch its breath. The next round round of major impressionist and contemporary sales, coming up in November, will paint a clearer picture of where the art market is heading. If no new "Dr. Gachets" emerge for hype, stardom and higher millions, the result will produce a more frugal repast. Most of the players welcome the prospect as long as the Japanese attend the dinner.