The art market is entering a new phase. Some describe it as a “cooling down”, while others call it a “slowing down”. Others say we are simply moving away from the frenzy of the past few years.
Andrew Fabricator, chief operating officer of Gagosian, thinks the changes have been mild so far. “There was no wholesale correction, there were subtle changes in prices,” he says. “The art market is not immune to the vicissitudes of the real world, but the effects are long in coming. It remains to be seen how this will turn out. »
Earlier this month, the US central bank raised interest rates to the highest level in 16 years. “High interest rates have certainly helped cool the market – money is expensive and people don’t speculate,” says Josh Baer, writing about the New York auctions in the Baer Faxt newsletter this week. . Other real-world concerns impacting the art industry include a declining real estate market. As Jessica Kreps, partner at Lehmann Maupin says, “Fewer people are buying houses, and there’s less need to fill those houses with artwork. There is a decrease in the appetite to buy. That said, collectors are more choosy about what they want; there will always be a market for quality.
Another sign that the boom is well and truly over is the news that one of the art world’s top advisers, Lisa Schiff, is being sued by clients alleging she was running a ‘Ponzi scheme’. Such scams usually proliferate in fatter times and are often exposed when the bubble bursts. Schiff, whose previous clients include actor Leonardo DiCaprio, now faces two lawsuits that allege she defrauded collectors in art sales worth millions of dollars, including an Adrian Ghenie painting that sold 2 .5 million at Sotheby’s, which had been co-purchased by collectors Candace Carmel Barasch and Richard Grossman.
Instead of paying galleries and other businesses, Schiff allegedly used the money to fund his ‘lavish lifestyle’ as well as ‘purchasing artwork for other clients’, according to court documents. . Schiff abruptly closed her business this week as the crisis deepened, although she declined to comment to the press.
Targeted stands stand out
At Frieze New York, booths dedicated to one or two artists are proving popular among merchants who are perhaps more interested in making a splash than racking up multiple sales. Even the mega galleries modestly present their offerings this week. Gagosian presents new works by the latest addition to the gallery’s roster, Nan Goldin, who has garnered attention for her activism in recent years but whose market is lagging behind. A spokesperson said the gallery had sold “significant numbers” of individual grids and photographs, priced between $64,000 and $90,000, to private collectors and museums, “indicating the enthusiasm and continued respect for the work of Nan Goldin”.
Stephen Friedman has also opted for a solo stand, which features new work by abstract painter Pam Glick, who joined the gallery in March. Five paintings sold on opening day for $55,000 each to clients based in New York and overseas. One sold to a corporate collection. Mira Dimitrova, the gallery’s sales manager, says the fair’s business “has gotten off to a very promising start.” She adds, “The heat may have cooled slightly, but that’s not a bad thing and overall the market looks stable.”
Pace said it sold out its stand of paintings and works on paper by rising New York artist Robert Nava – 11 were pre-sold and four sold on opening day. Prices between $30,000 and $80,000 are only a fraction of Nava’s auction prices, which regularly hit the $500,000 mark.
Pace has sold its stand of paintings and works on paper by Robert Nava
Photo: Alex Wroblewski
But, as new buyers retreat and scum clears from the top of the ultra-contemporary art market, prices begin to fall at auction. With that, there are growing calls for galleries that have raised prices based on auction results to lower them as well.
“Galleries will have to adjust prices, this should not be an anomaly. This is a long overdue fix, especially for works dated 2021 or 2022,” says Maker. “It’s wholesale speculation – the ‘I want to wake up rich tomorrow’ attitude – and I’d like to see some moderation of that behavior.”
Galleries at all levels seem to be feeling the pinch, even as accessible pricing keeps the wheels turning at Frieze. In Canada, four of Elizabeth McIntosh’s five paintings, priced at $25,000 to $32,000, sold out on opening day. The gallery’s sales manager, Andrew Lee, says: “We have all been through a change. When you get calls and texts from other resellers asking “how’s business for you?” you know something is going on.
Few galleries have recorded sales over $1 million. Hauser & Wirth said it sold “numerous” works from its solo stand dedicated to the late Jack Whitten, which ranged in price from $95,000 to $2.5 million. Thaddaeus Ropac says he sold ten works on the opening day, the most expensive, by Robert Rauschenberg, peaking at nearly €2 million. The Austrian dealer disagrees that the market is softening, although he says “surprisingly few Europeans” are in town.
Secondary market stumbles
Auctions represent another area of activity, and results have been mixed this week. Here too, prices are falling; there has been no work with nine-figure estimates, or even estimates in the upper eight figures. “There’s not the lure of a marquee sale to get attention,” says Maker.
The big question is whether there is enough demand to absorb all the material. Among those who managed to cut through the noise was a small painting by Ed Ruscha with a big estimate, which sold on a bid for $22.3 million at Christie’s 20th Century sale. The other prize of the week was a large painting by Jean-Michel Basquiat from 1983 which fetched $67 million with Christie’s 21st Century auction fees, more than half of the sale’s total ( $98.7 million). Only two bidders, including Larry Gagosian, pushed the price up.
While this auction sold at 96% per lot, several others hovered around the 80% sell rate, suggesting auction houses are being realistic about lowering their standards. Pre-sale nerves appear to have got the better of shippers at Sotheby’s Modern Art sale, which saw six lots withdrawn at the last minute.
Nonetheless, more than $2 billion worth of artwork was expected to sell during the two-week auction and there are plenty of signs of life elsewhere in New York. French concessionaire Daniel Templon opened space here last October, followed by Mexico City powerhouse Kurimanzutto, which opened in November. Both are located in Chelsea. After ten years of discussions, White Cube opens in a former bank on Madison Avenue in September, while Stephen Friedman will open in Tribeca this fall.
With the number of galleries multiplying, there are rumors that Frieze is now considering other venues in the city to accommodate more exhibitors and more revenue.. This year, the fair features its biggest lineup since moving to the Shed, with 68 galleries, though that’s still down from the more than 190 that attended when Frieze pitched its tent on Randall’s Island.
A spokesperson for the fair said “it is too early for us to comment on future plans”, and The arts journal understand that another three-year contract with the Shed was recently signed, so any move is far from imminent. But with the market facing increasing uncertainty, the biggest changes may be yet to come.
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