Auction house pays for having overestimated the viability of the boom in contemporary art

Representatives of Sotheby's said that because of not very successful auction on 11 November auction house has lost 10.6 million dollars in guarantees. Recall that, in the «guarantee», we mean a certain amount, for which the auction house is required to purchase the product, if it does not sell, or the amount that he pays the buyer if they have not reached pre-specified minimum price. If a lot is given a guarantee, it would give the auction house the right to determine the upset price.

There are a guarantee of the real headache for the auction houses: they are major trading began to prepare in the summer, when the mood of participants in the art market was still very blagostnym, but in October the market started to shake and the buyers was not until Giroux . Consequently, many valuable works were left unsold and the auction houses had to shell out. November 7, representatives of Sotheby's said that the failure to bid in the Hong Kong , London and New York cost them 42 million dollars -- respectively in October and November, the house has lost more than 52 million.

At the Sotheby's auction November 11, was presented to the post-war and contemporary art. Guaranteed works there were six. All of them were evaluated in 29,2-39,3 million dollars. But Sotheby's, in his report to the Securities and Exchange Commission United States said that the general estimeyt these works was 24,1-32,7 million dollars. This discrepancy is due to the fact that shortly before the bidding auction house tried to negotiate with the sellers of works that could reduce the lower the starting price - but it did not help him to insure against losses. Thus, the remaining unsold one of the most expensive pieces guaranteed - picture of Roy Lichtenstein (Roy Lichtenstein) «Half a person with a collar», which was estimated at 15-20 million dollars. Seller of work has been a great warranty: called up to the sum of 15 million. Said that Sotheby's is also given a guarantee of 18 million on canvas «Joy beggar» Gaston, Philip (Philip Guston), - a wild sum, given that the previous auction record for work by this artist at 7.3 million dollars. «Joy beggar» did find a buyer, but he paid for the canvas just 10 million (including Buyer's premium). Another work, «source, where the desire загадывают» Jeff Koons (Jeff Koons), rumored to have been guaranteed at 4.5 million dollars. She eventually «awarded» estimeyt in 2,5-3,5 million, but eventually it went under the hammer for just 1.8 million (2.2 million to the Buyer's premium).

The crisis in the art market is always painful hits the big auction houses. They are forced to retire from the owners of unsold work estimeyty which were given back in «golden days» art boom, and be prepared to sell them at a loss - perhaps the amount that want the buyers to pay for them a year or two, will be much less paid auction house on the warranty.

How do themselves in this situation feels another giant, Christie's? Recently, for he also had auction postwar and contemporary art , where not able to sell some top lots. Buyer does not have such expensive work, as the «Study of selfportrait» Francis Bacon (Francis Bacon), evaluated, according to the news of 40 million, and «Spatial Concept (Celebration on the Grand Canal)» Luchio Fountains (Lucio Fontana). However, the number of lots they are guaranteed not included. But at the pictures from the wife of Lehman Brothers Chapter lap Robert (Robert Fuld) Katie has been given a guarantee, but even there: 20 million dollars. But they had just 13.5 million. House Christie's, as a private company not obliged to report to the public about their income, but also because it is clear that «thanks» assurances from the house, too, have problems.

Now, auction houses is an important task - to adjust to new economic realities and to move towards reducing estimeytov and reserve prices, while reducing warranty. Such tactics chosen auction house Phillips de Pury & Co. He bidding works postwar and contemporary art, the last on 13 November , had a little bit, but on the assurances were not lost a single cent.

Material prepared Yulia Maksimova

Sources: bloomberg.com , artforum.com , artinvestment.ru