Post-pandemic optimism in the global art market

As someone who lives in New Jersey and enjoys my proximity to the New York art world, the past 18 months has been a time of things getting turned upside down in the arts for the obvious reason, with the coronavirus pandemic causing changes to gallery and museum schedules, accessibility, and more. I’m curious to see how things are this fall, when the typical art “season” starts with new shows and events, and to see how the art market has responded and adapted.

With this introduction, I turn this post over to Laura Elizabeth, who shares her perspective on how high-profile auction sales this past spring have kept growing confidence in the global art market:

Like so many other industries, the global art market struggled to maintain consumer confidence at the start of the pandemic. Global trade was down by almost a quarter last year, with a host of high-profile auction houses in Hong Kong, London and New York unable to host investors and collectors in person. The market is beginning to bounce back, however, thanks to the easing of restrictions and the increasing popularity of online auctions, with virtual sales having doubled in value from 2019 to reach a record $12.4 billion last year.

Investor and collector Olyvia Kwok, founder of London-based art firm Willstone Management, says that two high-end art sales in recent months are further signals that things are starting to turn around. She says the sales represent growing optimism in the global art market, despite a turbulent 18 months caused by the pandemic.

The first of these works, a Picasso portrait worth an estimated $55 million, fetched $103 million at auction following a high-value bidding war between two investors. The second, a Basquiat painting that was expected to sell for at least $50 million, went for $93.1 million after a battle between six bidders in May.

Picasso portrait almost doubles in value

The auction of Pablo Picasso’s famous portrait of Marie-Therese Walter, Femme assise prés d’une fenêtre (Marie-Thérèse), was the center of attention at Christie’s 20th Century Evening Sale in New York on May 13, 2021. The painting of Marie-Therese, a woman believed to have been Picasso’s muse and lover, was created in 1932 during his prolific “years of wonder,” in which the artist painted more than 100 works. Christie’s describes the portrait as that of “a winged goddess, a modern-day Nike, aglow with light and life.” The 146 x 114cm painting attracted interest from art experts all over the world, and it was easily the most high-profile piece exhibited at the auction in May, 2021.

The auction began at $45 million, before two investors became involved in a 20-minute bidding war which saw the price raised to $102.4 million, almost doubling the predicted estimate of $55 million.

Most of Picasso’s paintings of Marie-Therese were created during his so-called “years of wonder” period, which is part of what makes this work so highly-regarded. Unlike many of the others though, which feature the subject either nude of partially dressed, asleep or in a state of rest, this painting features Marie-Therese deep in thought, seated next to a window with her eyes open.

While interest in the painting can be attributed to its significant history, it was auctioned at Christie’s with a third-party guarantee, which Olyvia says could explain why it sold for a much higher price than any Picasso brought to auction in 2020. Auction guarantees have increased by 35% since 2016, although they currently fall short of the pre-pandemic peak of 44% in 2018. Recent figures show that 1,270 Post-war or Contemporary lots were guaranteed at auctions in Hong Kong, London or New York between 2016 and 2020, with an estimated value of $4.87 billion. On the significance of guarantees for high-profile sales, Olyvia said: “Third-party guarantees were definitely a winning tool to bring supply to the bidding rooms at low risk for the auction house.”

In addition to the Marie-Therese portrait, a number of other Picasso works have attracted interest from investors and collectors from all over the world this year, with three of his paintings fetching more than $10 million each at auction in London. In fact, of all paintings sold globally in the first quarter of 2021, Picasso’s signature was the most frequent among those sold above the $10 million threshold. Two more of his paintings, ‘Femme nue couchée au collier‘ and ‘Femme assise dans un fauteuil noir (Jacqueline),’ were on the list of the top 10 Fine Art auction results after being sold in London by Christie’s.

Basquiat painting sells for more than $90 million

The second high-profile sale was a Jean-Michel Basquiat painting called ‘In This Case,’ which went for $93.1 million at Christie’s inaugural 21st Century Evening Sale in New York on May 11. The piece, a painting of a skull measuring almost two meters in height, is now Basquiat’s second highest ever recorded sale, behind an untitled skull painting sold to Japanese billionaire Yusaka Maezawa for $110.5 million in 2017.

The painting had a similar valuation to the Picasso and was expected to go for at least $50 million at the evening sale. The auction started at $40 million and was fought by six bidders, who steady raised the price to a final $81 million, reaching its overall price of $93.1 million with auction fees and taxes.

Basquiat achieved his biggest success when at the peak of his fame in the 1980s, consistently earning $1.4 million from his works at auction. In This Case was publicly auctioned by Sotheby’s in 2002, and sold for just under $1 million. It was then sold privately in 2007 for an unknown fee.

Online auctions are boosting worldwide sales

Both of Christie’s 20th and 21st century sales were streamed live to audiences across the world, attracting bidders from auction houses in New York, London and Hong Kong, as well as across multiple social media channels and Christie’s own website. While face-to-face auctions have suffered during the pandemic due to social distancing restrictions, and public concern over the spread of the virus, online auctions have flourished, and the global market looks set to bounce back somewhat thanks to virtual sales of high-end artworks.

Olyvia says that such auctions have, to some degree, restored confidence amongst investors after a difficult start to 2020. Speaking after a successful remote auction by Phillips in October last year, she said: “Consumer market confidence is starting to come back after the summer.” With auction houses and collectors alike adapting to new ways of conducting business, coupled with this year’s record-breaking sales of high-profile works, the market is showing clear signs of bouncing back, even after the devastating impact of the pandemic.

Olyvia says that auction houses should continue to be adaptable in their approach as the market recovers. She added: “You can see as demand increases again on the high-end, playing with the equilibrium between volume and value seems to be the auction houses’ main bet for a rebound of the art market.”

For more information on this in-depth guest post by Laura Elizabeth, please see the following:

Christie’s Evening Sale results:

Jean Michel Basquiat – Most expensive works:

Global Art Market Report – 2021:

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