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Buyer confidence returns at Impressionist and Modern paintings sales as collectors - not speculators - drive the market

The auction houses bring out six long-held major estates to tempt collectors

New York

Real collectors returned to the salerooms this spring, pushing sale totals at Sotheby’s and Christie’s Impressionist and Modern paintings sales (11-14 May) to a respectable $138.8 million (£76 million) (on expectations of $160 million), paring the overall bought-in rate to 14% by lot, and convincing many that the art market has hit bottom and is heading back up. Although collectors have been the traditional mainstays of this market, they had been largely absent for several seasons. First Japanese and other speculators had pushed prices to heights at which few collectors could compete, then the artificial market collapsed and the ensuing confusion kept almost anything of quality off the block. Without much to tempt them, wary collectors continued to shun an unstable post-boom market. Bought-in rates in November were 35%, and as Sotheby’s Senior Vice President of North America, David Nash, says, “Buyer confidence was lacking”.

But this May, with six estates of desirable, long held, reasonably estimated, property locked up, auction houses had ammunition to break this cycle. The expectations of some more exacting living sellers were also whittled to realistic levels, and, faced with good property at tempting estimates, collectors apparently decided it was safe to come back. “It’s group psychology”, says New York dealer Susan Seidel of William Beadleston Fine Art. “People say to themselves: ‘If we’re at the bottom, I’d better get in now’”. Perhaps it was also relief at not seeing a flood of overpriced Japanese owned art back on the market, or the sense that the cloud of economic recession might be lifting.

In any case, collector confidence built slowly. After two lacklustre contemporary art sales, not much had changed. But the first Impressionist and Modern sale, Christie’s estate of Billy McCarty-Cooper, turned out to be a watershed event (see The Art Newspaper, No. 19, June 1992, p. 18). With a well known provenance, and a varied group of top quality pictures, fresh to the market and offered with flexible estate reserves, the sale was 95% sold. A subtle psychological barrier was crossed and at the next two evening sales, as Swiss dealer Jan Krugier says, “The revival of the Impressionist market was astonishing”.

Christie’s sale brought a total of $30 million (£16.4 million) and was 82% sold by lot. Most of the top works went to private collectors—faces both old and new. Mexican hotel chain owner Ignazio Cobo was one of the major new buyers, spending a total of $2.4 million (£1.3 million) on five lots, including $880,000 (£482,200; est. $800,000-$1 million) for “La maison de Collette à Cagnes” by Renoir, from a Boston estate. Cobo also dropped $825,000 (£452,000) on another Renoir listed as “the property of a private European collector”. This is known to be German fertiliser manufacturer Hermann Schnabel, whose consignment of fourteen paintings included the cover lot, “La Loge” by Renoir. Schnabel had paid $12.1 million (£6.6 million) for it in 1989, but expectations for this sale had been downsized to $6 million (£3.29 million). Still, there were no takers. “That estimate made no sense,” says London dealer Heinz Berggruen. “At $2-3 million, maybe it would have sold”. Maybe, but perhaps no estimate would have been low enough. “La Loge” had been up very recently, and with nothing sold lately at anything like $12 million, it is hard to say what it is now worth.

Generally, works by Renoir, Chagall, Sisley and Pissarro—artists hardest hit by the Japanese pull-out—stabilised at pre-boom prices, Renoir’s “Yvonne et Jean” from the Boston estate sold to an anonymous collector at $2.2 million (£1.2 million; est. $2-2.5 million). New York private dealer René Scharf paid $2.86 million (£1.57 million; within estimates) for another Schnabel picture, “Bouquet de Fleurs” by Marc Chagall, and a European dealer paid $1.87 million (£1.02 million) for Pissarro’s “Le Pont Neuf, après-midi de pluie”. In the same family since 1953, the painting was in pristine condition, and sold easily within estimates. “Composition avec rouge, gris, bleu et jaune” by Piet Mondrian, which sold to a European collector at $2.58 million (£1.41 million; est. $1.8-2.5 million) was part of the long held property from the estate of New York collector Henri-Georges Doll. The fact that Mondrian had painted over the back of the canvas had helped keep the painting in particularly fine condition.

Sotheby’s sale brought $28.9 million (£15.8 million) and was 83% sold. The sale’s priciest lot, another Renoir, “Portrait of Jean Renoir”, sold within estimates at $2.31 million (£1.26 million) to a South American collector. The appearance of such collectors from south of the border (including one rumoured to have bought the $7.7 million (£4.2 million) McCarty-Cooper estate Braque) was responsible for another interesting appearance—that of pesos on the electronic bid boards at both houses. North American TWA chairman Carl Icahn, who had shunned the auction rooms since the mid Eighties, purchased two works by Sisley at under $700,000 (£383,500) apiece. A Korean dealer was the buyer of “Nu debout devant la cheminée” by Henri Matisse, within estimates, at $2.2 million (£1.2 million)—a reminder that there are still real Asian collectors active.

That collectors—not speculators—are driving this market was also clear from the strong prices made by many works on paper. Lacking the bright colours and obvious tradeability of oils by famous names, works on paper provide something else: a more intimate, aesthetic experience that many knowledgeable collectors crave. “Drawings reveal the creative process, while paintings often conceal those aspects”, says New York private dealer Stephen Mazoh. Even after the market had absorbed the many drawings and watercolours in the McCarty-Cooper sale (at good prices), a Picasso drawing of 1904-5 from Sotheby’s Sidney E. Cohn estate “Etude pour l’acteur et deux profils de Fernando” brought $825,000 (£452,000)—two and a half times estimates. Then, a New York collector paid a record $1.2 million (£657,500) for “Femme assise en blouse roumaine”, a drawing by Henri Matisse that until recently had been part of the private collection of New York dealer William Acquavella.

At the end of the week, observers were optimistic, yet some still sounded a cautionary note: “This is the first time for a long while I have seen people saying ‘I want this drawing or painting’ without any idea of speculation”, says Jan Krugier, “but now we must keep control of the situation. We must have enough self discipline not to repeat 1989. That lesson was very severe”.

Originally appeared in The Art Newspaper as 'Buyer confidence returns at Impressionist and Modern paintings sales'