The Art Market Post-Pollock

The recent auction of a Pollock piece has captured widespread attention, being both significant and somewhat misleading. The artwork fetched $181.2 million, a decision strategically postponed until the market was ready. This sale is more striking than the $451 million Leonardo, which, despite its historical value, had certain issues. Unlike the Leonardo, the Pollock was created in the current era.

Alongside the Pollock, a Brancusi sculpture reached $107.6 million. Overall, Christie’s evening sale was an exuberant and well-conducted affair. 

However, the picture isn’t entirely rosy. In the $1.1 billion evening sale, about 30% of the artworks sold below their estimated value or did not sell at all. This included high-profile pieces like Agnes Gund’s Twombly. Many items had third-party guarantees, ensuring they wouldn’t be bought in.

The sale of the McNeil Minimalist collection at Christie’s saw five out of 12 lots selling below or at the low estimate, with an early Artschwager being a notable success. 

Similarly, at the Phillips Modern and Contemporary evening sale, over a third of the items sold below or at their low estimate. This trend continued at Sotheby’s Now and Contemporary evening sale, where over a third of the lots sold below estimate, went unsold, or were withdrawn. 

These events are the highlights of the auction calendar. Generally, the average prices of sales at night (and to a lesser degree during the day) fell between the low and high estimates, indicating that auction houses are adept at pricing. However, there is some social engineering involved, as too many bidders rely on these estimates to gauge an artwork’s value.

High-value artworks from renowned estates like those of S. I. Newhouse, Agnes Gund, Weis, Pritzker, and Leonard Lauder typically perform well. Conversely, there is limited urgency for other items, and their estimates are notably conservative.

Auction houses strive for high sell-through rates, often negotiating low estimates to encourage higher bids. This strategy results in sales achieving near-mid estimates, which are often lower than gallery prices for comparable new works.

Buyer’s premiums have risen to 27–28% until the price reaches about $1–2 million, with consignors facing charges of up to 10%, leading to significant dissatisfaction among sellers. 

When auction results are published, commissions are added, making it appear as though a de Kooning piece estimated at $25–35 million sold for $26 million, while the actual hammer price is far below the low estimate.

Notably absent were works by artists who were recently in vogue but whose prices have since plummeted. The sharp declines of recent years were less apparent this time.

This season, Christie’s emerged as the winner. They excelled with superior quality, effective screen visuals, pacing, and pre-sale installations. A room dedicated to Minimalist masterpieces featured three pristine Donald Judds and a luminous Judd “stack.” A large Nakashima dining room table and chairs were displayed to evoke a domestic setting, although not for sale. Despite underwhelming sales, the ambiance was beneficial.

Sotheby’s decision to sell their York Ave and 72nd building to Weill Cornell and relocate to the Breuer may prove more costly than beneficial. The Basquiat centerpiece faced visibility issues, and some artworks were not properly displayed or were shown back at York.

Following COVID-19, Phillips opened a 55,000-square-foot space on Park Avenue. However, they have since vacated parts of the building, leaving a challenging space for art exhibitions.

Reflecting on these events, several bidders were prepared to spend over $100 million. As a lifelong collector, it is perplexing that a single painting can cost more than feeding millions of people.

While I appreciate the value of my art collection, which includes pieces like an Ellsworth Kelly 1970 “Chatham,” I am concerned about the growing wealth disparity. The wealth of the top 1% is at an all-time high, and the spectacle of these auctions is troubling compared to other luxury purchases.

Having practiced oncology for nearly 40 years, I am concerned about the low earnings of pediatricians and primary care doctors, and the high cost of cancer drugs, some exceeding $20,000 a month.

I also worry about the state of galleries. Since last November, over half of the Lower East Side galleries have closed, with the number dwindling further in recent months. On Grand Street near my gallery, fewer than 20% of pre-pandemic galleries remain. 

Many galleries are opting out of art fairs or choosing smaller booths. Art Dubai proceeded despite regional conflict, with some galleries having their funds held until 2027. 

The art system is struggling, and despite the high-profile success of events like the Pollock sale, not everything in the art world is thriving. The notion that the art market is a playground for the wealthy is both true and misleading. The market supports tens of thousands of artists, most of whom are struggling, and we need both the artists and the galleries to enrich our lives.