By: John Dorfman
This past June and July, a very interesting thing took place in the London salesrooms of Christie’s and Sotheby’s. The results for Old Master paintings surpassed those for contemporary art, and they came surprisingly close to those for Impressionist and modern art. To market watchers, this topsy-turvy state of affairs signaled a shift in art-world priorities in the wake of the global economic crisis. While there is no shortage of doom and gloom, both financial and emotional, in the art market as a whole, there are some glimmerings in the darkness. In at least several fields, such as Old Masters, buyers are active and prices strong—and not only at the bluest-of-the-blue-chip level. Art & Antiques sought out market participants who have weathered previous cycles of ups and downs, to ask them why their fields are resisting the recession and what that might mean for the future.
“The Old Master market is extremely strong right now,” says London dealer Johnny van Haeften, which he ascribes in part to the fact that it remained aloof from the bubble-blowing of the art boom. “It is a collector-driven market,” says van Haeften. “There was no hyperinflation, no speculative buying. I cannot point to a single customer of mine who is buying Old Masters for investment purposes. They do look at the financial aspect, as well—it would be mad not to—but they’re not buying for speculation; they’re buying because they like the pictures. You can see it in their eyes, the excitement when I say we’ve got something really wonderful that has just come in.”
Relative affordability is also a factor in keeping this market vibrant, even during tough times. “Your money goes a lot further in Old Masters,” says van Haeften. “For say, $10 million you can form a really good collection. You can buy 10 or 12 good pictures, or one great one at the top of the market. Or, you could buy very second-rate Monet or a couple of Gerhard Richters.” Of course, what van Haeften calls the “natural diminution of supply”—an issue in any non-contemporary field but especially so for Old Masters—is also a factor in keeping the market strong.
Old Masters are a sound investment—van Haeften points out that “they haven’t fallen in value in 400 years”—but it takes some scholarship to appreciate them, as well as a willingness to transcend one’s own time and place. Certain categories of work, such as history painting and religious painting, as opposed to portraiture and landscape, are still somewhat undervalued, says New York dealer Jack Kilgore, and early Italian gold-ground pictures are “very undervalued.”
The recondite nature of many of the works accounts for the lack of impulse buying and speculation, but it also poses a challenge to dealers. Kilgore notes a lack of young buyers, and believes they have to be shown that “they can put Old Masters with new things and mix them.” The dealer community is putting its energies into publicity with events such as Master Paintings Week in London in July (see page TK). And Van Haeften is not above the occasional publicity stunt. His place is opposite White Cube, the high-profile contemporary gallery, and he recalls a recent Gilbert and George opening there. “I was absolutely appalled. There were 200 or 300 people outside my front door and they didn’t even look. I had a portrait of his mother by Heemskerck in the window, so I went and hung it upside down. At that point, people started coming in. We had a good laugh—the upside-down world is very much a part of the Dutch sensibility.”
With works dating back to the very origins of civilization in the ancient Near East, Egypt, Greece and Rome, the field of antiquities has an even longer track record than Old Masters, but it has recently come in for some special challenges. A growing consensus on cultural-property issues has effectively made a sizable contingent of works—those without documented proof that they were not recently looted—very difficult to sell. Nonetheless, the field remains vibrant and collector interest strong.
“Good provenanced antiquities have grown quite rapidly in value as supply diminishes,” says Jerome Eisenberg, owner of Royal-Athena Galleries in New York. “Due to the attention being paid in countries like Italy, Greece and Turkey, less material is being brought on market.” The result? “I had my biggest year of sales last year by far,” says Eisenberg, “50 percent larger than the year before, and double the year before that. And so far this year is very good, but I don’t think it will be as large as last year.”
Eisenberg is not shy about stressing the investment value of antiquities. “I’ve been doing appraisals for 50 years,” he says, “and I’ve seen the value go up 8 to 10 percent a year on average. He adds that in today’s uncertain economic climate, many buyers are looking for safe investments, and for some at least, antiquities are attractive when compared to financial securities. “Antiquities doesn’t fluctuate as widely as some other areas like contemporary art, Islamic art or Chinese and Indian contemporary. The aesthetic is universal; it’s held up for thousands of years. Ancient art was already popular in the Middle Ages, and it’s never gone down in valuation by any society.”
But will diminishing supply combined with growing disapproval in some quarters, eventually cause the collecting of ancient art to come to an end? “Far from it,” says Eisenberg. “The supply is decreasing, but there will always be a supply. Second- and third-generation owners eventually do sell material that they may not be interested in keeping. Pieces I sold to clients 40 years ago, their grandchildren are now selling back to me.”
New York dealer James Lally of J.J. Lally & Co. recalls the exhibition he mounted during Asia Week this past March: “It was the absolute nadir of the stock market. We had an exhibition of the collection of Dr. and Mrs. Marvin L. Gordon, which was primarily Sung Dynasty ceramics, a very popular category and one of high points in Chinese culture. The Gordons had very simple taste; they collected not to invest or impress but just bought what they liked. They were moving house and decided to sell. All newspapers they opened were saying it was a terrible time.” Lally believed otherwise, and his intuition was confirmed when he sold approximately 80 percent of the collection on opening night, “at prices well above what the Gordons paid, in most instances.” Another 10 percent has sold since then. “We thought this demonstrated strength at a very low point in the economy,” says Lally.
Part of this strength, he explains, “is simply because there are continuing trends which had already been rapidly developing during last decade or more, to some degree inside China. Buyers in China and Hong Kong haven’t suffered, in general, as severely as buyers in the West. Chinese banks hadn’t been playing the same games as American banks.”
In addition, Lally sees the same motive at work in the Chinese market that Eisenberg sees in antiquities: the search for security in a classic field. “There is a school of thought that inflation is going to be a very likely result of the situation we’re in now. This has driven people toward collecting art as a hedge against this inflation.” He recalls that earlier financial crises—such as the 1974 oil crunch, which came right after Japanese had driven up prices for Chinese art, and the 1989–90 recession—caused “a very direct impact on the Chinese market.” However, Lally says, “this time I have not seen any significant impact or downturn.” He cites a combination of factors to explain this performance: “Not only has Chinese art come of age, but there is a growing market worldwide. The supply is finite, and we are getting more people interested. It’s basic Adam Smith. Chinese buyers are not buying just for aesthetics; they’re very keen on the investment side of things.”
Unlike Old Masters, the field of mid- to late-20th century design has the youth vote and is prospering due to generational factors. John Sollo of Sollo Rago Modern Auction in Lambertville, N.J., a specialist in the category, says, “The modern market has a couple of real advantages. First is a demographic that goes with it. I’ve been in this field since I was 21; I’m now in my 50s. I think to a large extent that the under-40 crowd is really interested in modern.” As reasons he cites lack of “emotional connection” with traditional antique furniture, coupled with a desire to acquire pieces that evoke childhood or early-adult memories.
Speaking of the current economy, Sollo says, “Has modern been hit? Of course, but I think we’ve held our own a lot more than a lot of areas in the collecting world. Prices have gone up and up from late ’80s till last year—not straight up but certainly the trajectory was upwards.” As for now, prices and buyer interest remain strong, though not across the board. “Scandinavian furniture hasn’t been touched at all,” he says. “The prices are steady, rock-hard. Why? I have no idea!” Certain American designers, such as Paul Evans (see page TK [OOD]) and Wharton Esherick, are in demand. “Evans has weathered the storm very well. He is a huge hit among Europeans; the world’s become much smaller. We sell 30, 40, or 50 pieces of his in every auction,” says Sollo. “Herman Miller and Knoll are being bought by people in their 20s are buying as starter furniture, so that sector is doing OK.” George Nakashima, on the other hand, “has really suffered some. It’s one of the few things that has gone the whole course. It was probably too high, and it’s come down.”
Affordability and the chance to make a real discovery can also be sources of strength in collecting field. In the opinion of Frank Maresca of Ricco Maresca Gallery in New York, that is definitely the case with Outsider and vernacular art, which he has been promoting and selling for three decades. “Last year was best our gallery has ever had in the almost 30 years we’ve been in business,” he says. “It took us by surprise, on the cusp of what was to be the worst art economy that I’ve ever seen. We did fine and are doing fine for a number of reasons: Outsider and self-taught art received a lot of attention in the last five years, but in comparison with the contemporary market, there was no bubble. It’s somewhat under the radar, and priced low from a quality point of view. You can still buy a masterpiece for $100,000 and under. In the contemporary market, that is completely and totally a joke. To enter at the top of the market if you buy carefully, and acquire something that might be masterpiece of the future for under $20,000—that’s a big-deal thing.”
Outsider material, such as the work of the late Martín Ramírez, which Ricco Maresca exclusively represents, is increasingly being perceived as having “the capability of holding its own with the best,” says Maresca. “If a collector is going to consider buying, but they’re not going to spend a million dollars, they can spend a tenth of what they were spending in other fields and not compromise quality.” Maresca is adamant that the art he champions be seen as a branch of modern and contemporary art and appreciated first and foremost for its artistic merit, not for the artists’ often colorful or surprising life stories. “We’ve always been about crossover of self-taught and Outsider into contemporary and modern universe. It’s always been too slow for me, but we’ve never wavered.”
Illustration art—original paintings made, usually in the 20th century, for the express purpose of mechanical reproduction—couldn’t be more different from Outsider art, but it, too, is a young collecting field that is prospering in lean times. Heritage Auction Galleries in Dallas has made illustration art a particular specialty, and their most recent sale, held July TK, was their highest-grossing yet at $3.1 million and set records for some 20 artists. While names like J. C. Leyendecker (a magazine illustrator popular circa 1910–30), Gil Elvgren (king of the pinup artists), Alberto Vargas (he of the leggy “Vargas girl”), George Petty and Tom Lovell are rarely, if ever, even whispered in the halls of the mainstream art world, they have a serious following among a demographically diverse coterie of collectors.
Immediate, visceral appeal can’t hurt, and combined with nostalgia it’s a can’t-miss formula. “People like it; there’s not a lot to explain, it’s just fun,” says Ed Jaster, Heritage vice president and head of the illustration art department. Pinup art is the strongest, followed by steamy or sleazy pulp illustration from the 1930s and after (comics are generally not included in the illustration category). “Most of the art we sell is a conversation-starter,” says Jaster. “Throw this up on the wall, and everyone is going to comment. All walks of life get interested in this kind of art. What’s not to like?”
And while an Elvgren went for $143,000 in the July sale, and a Leyendecker for $155,350, much of this material is still very affordable. “One great thing about illustration art is that you can get a really good painting by a name painter for $1,500,” says Jaster. At the very top end of the market, artists like Norman Rockwell and Maxfield Parrish have already graduated in the more rarefied world of American paintings, with prices in the million. Jaster foresees such an evolution for Leyendecker. “He should have auctions records in the $2–3 million range. The best Leyendeckers are only just now coming out on the market.”
Above all, whether one’s interests are scholarly or populist, ancient or contemporary, the current art market is sending buyers a message about opportunities and value. Veteran art adviser Thea Westreich, who has seen several boom-and-bust cycles come and go, says, “To continue to read articles about the damage done to the art world by the economy is simply not to acknowledge that there are enormously positive results that are going to provide huge opportunities for those who are engaged in thinking about art and, ultimately, owning art.”