Wednesday, May 3, 2017

General market consolidation | The Art Market in 2016


General market consolidation

In 2016 China re-emerged as the clear leader of the global art market with an auction turnover total of $4.79 billion from 91,400 lots sold.

2016 Auction turnover distribution by country

2016 Auction turnover distribution by country
In 2015, the Chinese art market underwent a serious readjustment and posted a 26% decrease in turnover, whereas the United States generated its best-ever performance totaling $6.2 billion. In 2016, the situation reversed: the Chinese art market stabilized (-2%) while the West suffered a 36% contraction. Posting a total of $3.5 billion from 72,500 lots sold, the USA lost its leader title on the global art market.

Auction turnover totals by country (2015/2016)

Between 2009 and 2014, the principal Western countries of the global art market experienced five consecutive years of growth. In 2015, they maintained the pace thanks to an extraordinarily dynamic high-end: 140 results above the $10 million threshold, including two results above $170 million (a threshold never before crossed). Naturally, this exponential price growth could not last indefinitely and financial hesitations – initiated in H2 2015 – prompted a sharp fall in the number of top-end masterpieces offered in sales rooms. As a result, only 61 works fetched over $10 million in 2016, and none reached into the 9-digit zone. This contraction has primarily affected turnovers at the major Anglo-Saxon marketplaces which host the major prestige sales, with New York down -43% and London down -30% vs. the previous year.

Transaction volumes up in the West

The Western art market demonstrated extraordinary resilience and dynamism throughout a tumultuous 2016 marked by a series of political surprises and financial market hesitations. Indeed, the record volume of transactions partially compensated the reduced turnover.
The 398,000 fine art lots sold in the West represented the highest volume ever recorded, while the overall unsold rate remained stable at approximately 37% compared with 2015. The auction houses have shown a remarkable capacity to stimulate demand with an appropriately tempered supply, while maintaining the quality of the lots offered for sale. The United States and the United Kingdom posted trading volumes up +24% and +27% respectively. This supply strategy has allowed sellers to maintain transaction volumes at their highest level and stabilise prices.

Western Fine Art turnover and lots sold (2005 – 2016)

Western Fine Art turnover and lots sold (2005 - 2016)
In 2016, most of the major European art market hubs respected this general trend. France, Italy, Austria and Belgium all posted flat turnover totals (between +1% and -1% vs. 2015), but they all posted higher transaction volumes: +8%, +4%, +14% and +15%, respectively.
Germany and Switzerland were exceptions to this new dynamic. Both countries maintained their respective 5th and 7th positions in the global ranking, but posted contractions of -12% and -5% in auction turnover. Spain’s performance was even worse ($17 million) suffering a 20% reduction in turnover, dropping to 27th place in the ranking. Spain is being increasingly squeezed out by emerging marketplaces like Turkey ($31 million), the Philippines ($29 million) and the United Arab Emirates ($23 million).

The Chinese market finds its equilibrium

The structure of the world’s leading art market is profoundly different to the structure of Western art markets. Surprisingly, with approximately two-thirds of its artworks remaining unsold, China has a much higher unsold rate than the West. In fact over the last ten years this rate has become the norm in China, which nevertheless stands out as the most dynamic market in the world with 277,500 artworks on offer in 2016.
Calligraphy and traditional painting still account for the bulk of the Chinese market, representing 92% of lots sold and 81% of sales turnover. However, Hong Kong’s growing market generates much of its turnover from Oil Painting and Contemporary Art. Today, Hong Kong is one of the world’s largest and most dynamic art marketplaces capable of attracting the best art from both Asia and the West. It is also a major outlet for in-vogue artists. Although an integral part of the People’s Republic of China, Hong Kong has branches of many highly prestigious European and North American galleries. The city also hosts one of the three editions of Art Basel, the world’s most selective fair of Western Contemporary art.

Phillips’ Fine Art turnover in 3 cities (2006 – 2016)

Phillips’ Fine Art turnover in 3 cities (2006 - 2016)
In November 2016, the American auction house Phillips held its first sale of 20th Century & Contemporary Art & Design Evening Sale in Hong Kong. The sale brought together works by major Eastern artists (Yoshitomo Nara, Zeng Fanzhi and Ufan Lee) and Western artists (Roy Lichtenstein, Gerhard Richter and Anish Kapoor). By opening a new Fine Art sales outlet in Hong Kong, Phillips has adopted the strategy previously followed in the 1980s by Christie’s and Sotheby’s, then by Bonhams and then by China’s top two auction houses, Poly International and China Guardian. The presence in Hong Kong of all of the world’s leading secondary market players (and top galleries…) confirms the decisive and growing importance of this city on the international scene, which acts as a perfect bridge between the People’s Republic of China and the West.
With 38% of global Fine Art auction turnover, China has never accounted for such a large share of the global art market. Six Chinese auction houses are now among the Top 10 Fine Art auction operators, while the four Western firms in the ranking are all present in Hong Kong (Christie’s is also present in Shanghai).

Top 20 auction houses (2016)

Revenue ($)Auctioned lots
3Poly International988,895,7769,398
4China Guardian609,113,3226,648
5Beijing Council551,777,5003,879
7Xiling Yinshe Auction176,433,8174,341
9Holly International123,197,9611,470
10Zhong Hong Xin International Auction90,348,753986
11Canton Treasure Auction89,724,1212,014
12Shanghai Jiahe Auction87,014,1641,849
13RomBon Auction72,915,8142,505
15Seoul Auction71,749,0201,143
16Shanghai Mission Auction69,379,508414
18Beijing Hanhai Art Auction63,413,7122,924
19Beijing Inzone International Auction62,874,981454
© / AMMA

General stabilisation of prices

After falling throughout 2015 and into the first half of 2016, the overall art price index returned to a positive orientation due primarily to the adjustment of Western supply and the stabilisation of Chinese auction turnover.

Artprice global price index – Base 100 in January 1998

Artprice global price index - Base 100 in January 1998
In 2015 the numerous auction records acted as a smokescreen for a generalised depreciation of the Western market. This year, the auction houses abandoned the race for records in order to consolidate the core market. In transaction terms, the “under $50,000” price bracket showed the sharpest increase, rising from 341,000 to 382,000 lots. These transactions now account for 96% of total Western market transactions.
In China, the adjustments undertaken last year and pursued in 2016 have likely stabilised a market whose value had risen too quickly. Between 2008 and 2011, the average price of an artwork at auction in China rose suddenly from $22,000 to $52,000, while the number of transactions tripled. In just four years, the total turnover from Fine Art at auction sales in China was multiplied by a factor of 6.5, rising from $1.6 billion in 2008 to $10.5 billion in 2011. By stabilising at around $4.8 billion in 2016, the Chinese market has resolved several major weaknesses, including that of unsettled final bids.

Art’s financial performance

The intrinsic development of the art market and a cluster of external economic and financial factors have contributed to a reality that is increasingly evident: art has become a perfectly serious alternative investment. Alongside traditional investments – financial assets and real estate – artworks represent not just aesthetic values, but also offer highly competitive returns. High price volatility – which might appear to make this type of investment overly risky – can be largely controlled.

Price structure (2016)

Auctioned lots percentagefor a price inferior to
Based on a sample of more than 3,900 artworks that had already been sold at auction and whose provenance was confirmed by the auction houses responsible for their resale, Artprice has calculated an average return on investment (ROI) of +88% over an average holding period of 11 years, i.e. an annual yield of 5.9%. In our sample, 45% of the works posted a negative price variation. Fortunately, the gains largely offset the losses. This finding perfectly illustrates the importance of building a diverse collection to reduce the overall risk and benefit from the general value accretion of art in the long term.
Numerous examples attest to the kind of returns that are possible from investment in art. In 2016 we saw the following cases:
  • Richard Smith’s Another Place (1959), sold by Christie’s in London in March 2006 for $2,700 and acquired in November 2016 for $44,000 at Sotheby’s. A gain of +1,500% in 10 years, driven primarily by a revival of his market following the artist’s death in April 2016. His auctioned lots tripled in 2016 compared with previous years.
  • Victor Vasarely’s Rhombus-C (1968), purchased in 2004 for $14,700 at Farsetti in Prato (Italy) and sold twelve years later at Dorotheum in Vienna for $106,000, more than 7 times its purchase price.
  • George Condo’s “Ballet blanc” (1998), acquired in 2003 for $14,300 at Christie’s New York, sold at Sotheby’s in the same city in September 2016 for $200,000, generating an annual return of +22% for the collector.
    The uncertainty of investments in art is still primarily related to changing preferences over the long term. Whereas price changes remain relatively small over months, they can be giant in either direction over one or two decades. In 2016 we again saw examples of this:
  • Richard Prince’s Untitled (Jokes)(1989), bought for $27,830 at Sotheby’s in New York in May 1993 and sold for $4.8 million at Christie’s New York in May 2016.
  • Martin Barré’s “67-Z-12” (1967), bought at Etude Briest in Paris for $7,000 in 2000 and sold by Artcurial on 6 June 2016 for $215,000, i.e. 30 times its purchase price.
  • Vassily Tsagolov’s From the Series of Office Afairs (2008/09), bought at Phillips London in 2009 for $54,000 and sold by the same house for $1,700 on 13 April 2016. The buyer, who acquired the work at the artist’s price peak, had already tried to sell the painting in 2015. The final depreciation amounted to -97%.


The major adjustments in both the East and West, despite operating in opposite directions, are contributing to a delicate stabilisation of prices around the globe. The outlook is now much more optimistic than last year. In 2016 doubts hovering over the market in the first months of the year were relayed by a number of political events that fueled fears of a crisis. However fourth quarter results suggest that the worst disturbances are behind us. The primary risk going forward is that of another major political upheaval that could impact the art market via financial markets.

Global Fine Art auction turnover, by semester (2008-2016)

In 2017, it is unlikely that the major auction houses will generate results as good as those in 2015. They are likely to continue strengthening the core market before gradually returning to a growth path. The contraction of sales turnover in the USA and the UK was probably both necessary and provisional.
Note that 2017 is a particularly busy year in terms of major artistic events. The Whitney Biennial – postponed in 2016 -, the Venice Biennale and dOCUMENTA 14 will take place during the first half and will undoubtedly stimulate sales.

The most successful women artists of the market

The most successful women artists of the market

[25 Apr 2017]
Women artists are starting to emerge in a world dominated by male artists for centuries. A number of recent auction results confirm this trend.
Women’s relative under-representation and under-valuation in the art market has been the subject of a recurrent public debate for at least 30 years. In 1985 a group of New York-based radical feminist artists called the Guerrilla Girls denounced the blatant domination of male artists in major museums. Their slogan at the time, “Do women have to be naked to get into the Met Museum?”, was highly pertinent: women appear in museums far more as nude subjects for male artists than as artists themselves. Under-represented in cultural institutions, they were (and still are) under-represented from a commercial point of view, leading to a very significant valuation gap and to a generalised price shortfall compared with male artists.
Although women still represent a much smaller proportion of the artists on the high-end art market, the top female artists nevertheless receive better market support nowadays than in the past. The Impressionist painter Berthe Morisot holds a better auction record than her male Impressionist counterpart Alfred Sisley (Morisot’s Après le déjeuner fetched $10.9 million at Christie’s London on 6 February 2013 compared with Sisley’s record of $9 million for Effet de neige à Louveciennes). Frida Kahlo represents another positive example: in the mid-1990s, her best works sold at the same price levels as her husband Diego Rivera’s, but today her work is worth much more and her auction record stands at nearly three times that of her former partner ($8 million in May 2016 for Dos desnudos en el bosque, a small canvas just 25cm tall). A third example is the sharp revaluation of Gabriele Munter whose Fuchsia in front of a Moonlit Landscape (1928) rose from about $22,000 to $423,300 in just thirty years (sold on 24 June 1986 at Christie’s London, then resold on 25 June 2015 at Sotheby’s London). Although the auction record of this great German Expressionist represents just one sixth of that recorded for August Macke, a 1,767% increase over 29 years shows that some women are enjoying substantial market uplift. The recent performances of artists like Rosemarie Trockel, Helen Frankenthaler, Barbara Hepworth and Nathalie Gontcharova confirm this trend. The market is therefore waking up to female artists, particularly from the late 19th century and early 20th century. But this awaking has only really been apparent since works by male Impressionist, Expressionist and Surrealist artists became extremely are on the market … and extremely expensive.
Today, the celebrity of remarkable artists like Niki de Saint Phalle, Louise Bourgeois, Yayoi Kusama, Cindy Sherman, Annette Messager, Tracey Emin, Nan Goldin, Marlene Dumas or Bridget Riley is somewhat reassuring, especially as their work also receives a lot of secondary market attention. Some female artists have generated auction results as good as the top male artists: Louise Bourgeois, Yayoi Kusama and Cindy Sherman are among the few Contemporary artists to have crossed the million-dollar threshold. And the market has also shown considerable interest for certain lesser-known artists like Jacqueline Humphries, an American who caught the market’s attention after New York’s Whitney Museum began to show interest in her abstract paintings. Before the Whitney, her best works fetched less than $20,000 at public sales. After the Whitney, they began to sell above $60,000 and she now has a record of $100,000 for her canvas 95% (Phillips, 15 May 2015), a painting that was originally acquired for just $1,200 in 1994.
That kind of increase is rare for living female artists. Another – even stronger – has been the revaluation of her compatriot Elaine Sturtevant. Prefiguring a certain form of Appropriationism, Sturtevant managed to ‘discover’ a number of major artists by literally copying their works, in most cases, well ahead of the market’s interest in their work. Her carefully inexact copies included works by Jasper Johns, Roy Lichtenstein, Claes Oldenburg, Andy Warhol, Joseph Beuys, Marcel Duchamp, and Anselm Kiefer. On 2 December 2014, the Parisian auctioneer, Artcurial, offered her emblematic Warhol’s Marilyn Monroe (1967). Originally acquired for $3,000 in 1999 (at Binoche, Paris), the collector decided to sell it 15 years later. Estimated at just under $150,000, the bidding climbed to nearly $412,000 equivalent to a gain of almost 13,000% in 25 years. A record for Sturtevant in France, that result came just a few months after her death and the market always tends to tighten sharply after the demise of an iconic artist, especially if that artist sells well in the United States. So, as expected, Sturtevant’s prices soared in 2014-2015 before deflating somewhat over the following two years. However, we would not be surprised to see a resurgence in demand for work by this visionary artist who was awarded a Golden Lion at the Venice Biennale in 2011.
Recognition by museums like the Whitney or winning an important award like a Golden Lion in Venice are vital steps in an artist’s careers… and are perhaps even more important for women artists. It is certainly no coincidence that this year’s Golden Lion Award For Lifetime Achievement was awarded to Carolee Schneeman, a pioneer of feminist performance art, at a time when questions of gender equity and equality have regained a much more central position in public debates.

Secret Ingredient for Success

SundayReview | Opinion
Secret Ingredient for Success
Editors' note: We're resurfacing this story from the archives to help you get 2017 off to a successful start.
WHAT does self-awareness have to do with a restaurant empire? A tennis championship? Or a rock star’s dream?
David Chang’s experience is instructive.
Mr. Chang is an internationally renowned, award-winning Korean-American chef, restaurateur and owner of the Momofuku restaurant group with eight restaurants from Toronto to Sydney, and other thriving enterprises, including bakeries and bars, a PBS TV show, guest spots on HBO’s “Treme” and a foodie magazine, Lucky Peach. He says he worked himself to the bone to realize his dream — to own a humble noodle bar.
He spent years cooking in some of New York City’s best restaurants, apprenticed in different noodle shops in Japan and then, finally, worked 18-hour days in his tiny restaurant, Momofuku Noodle Bar.
Mr. Chang could barely pay himself a salary. He had trouble keeping staff. And he was miserably stressed.
He recalls a low moment when he went with his staff on a night off to eat burgers at a restaurant that was everything his wasn’t — packed, critically acclaimed and financially successful. He could cook better than they did, he thought, so why was his restaurant failing? “I couldn’t figure out what the hell we were doing wrong,” he told us.
Mr. Chang could have blamed someone else for his troubles, or worked harder (though available evidence suggests that might not have been possible) or he could have made minor tweaks to the menu. Instead he looked inward and subjected himself to brutal self-assessment.
Was the humble noodle bar of his dreams economically viable? Sure, a traditional noodle dish had its charm but wouldn’t work as the mainstay of a restaurant if he hoped to pay his bills.
Credit Marion Fayolle
Mr. Chang changed course. Rather than worry about what a noodle bar should serve, he and his cooks stalked the produce at the greenmarket for inspiration. Then they went back to the kitchen and cooked as if it was their last meal, crowding the menu with wild combinations of dishes they’d want to eat — tripe and sweetbreads, headcheese and flavor-packed culinary mashups like a Korean-style burrito. What happened next Mr. Chang still considers “kind of ridiculous” — the crowds came, rave reviews piled up, awards followed and unimaginable opportunities presented themselves.
During the 1970s, Chris Argyris, a business theorist at Harvard Business School (and now, at 89, a professor emeritus) began to research what happens to organizations and people, like Mr. Chang, when they find obstacles in their paths.
Professor Argyris called the most common response single loop learning — an insular mental process in which we consider possible external or technical reasons for obstacles.
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LESS common but vastly more effective is the cognitive approach that Professor Argyris called double-loop learning. In this mode we — like Mr. Chang — question every aspect of our approach, including our methodology, biases and deeply held assumptions. This more psychologically nuanced self-examination requires that we honestly challenge our beliefs and summon the courage to act on that information, which may lead to fresh ways of thinking about our lives and our goals.
In interviews we did with high achievers for a book, we expected to hear that talent, persistence, dedication and luck played crucial roles in their success. Surprisingly, however, self-awareness played an equally strong role.
The successful people we spoke with — in business, entertainment, sports and the arts — all had similar responses when faced with obstacles: they subjected themselves to fairly merciless self-examination that prompted reinvention of their goals and the methods by which they endeavored to achieve them.
The tennis champion Martina Navratilova, for example, told us that after a galling loss to Chris Evert in 1981, she questioned her assumption that she could get by on talent and instinct alone. She began a long exploration of every aspect of her game. She adopted a rigorous cross-training practice (common today but essentially unheard of at the time), revamped her diet and her mental and tactical game and ultimately transformed herself into the most successful women’s tennis player of her era.
The indie rock band OK Go described how it once operated under the business model of the 20th-century rock band. But when industry record sales collapsed and the band members found themselves creatively hamstrung by their recording company, they questioned their tactics. Rather than depend on their label, they made wildly unconventional music videos, which went viral, and collaborative art projects with companies like Google, State Farm and Range Rover, which financed future creative endeavors. The band now releases albums on its own label.
No one’s idea of a good time is to take a brutal assessment of their animating assumptions and to acknowledge that those may have contributed to their failure. It’s easy to find pat ways to explain why the world has not adequately rewarded our efforts. But what we learned from conversation with high achievers is that challenging our assumptions, objectives, at times even our goals, may sometimes push us further than we thought possible. Ask David Chang, who never imagined that sweetbreads and duck sausage rice cakes with kohlrabi and mint would find their way beside his humble noodle dishes — and make him a star.
Camille Sweeney and Josh Gosfield are the authors of the forthcoming book “The Art of Doing: How Superachievers Do What They Do and How They Do It So Well.”
A version of this op-ed appears in print on January 20, 2013, on Page SR4 of the New York edition with the headline: Secret Ingredient For Success. Today's Paper|Subscribe

Slow photographs worthy of deeper consideration

1:20 pm /
The First Art Newspaper on the Net Established in 1996PortugalWednesday, May 3, 2017

Slow photographs worthy of deeper consideration on view at Baxter St at the Camera Club of New York
Lisa Fairstein, Of a Color, 2017.
NEW YORK, NY.- Baxter St at the Camera Club of New York presents Deep Shade, an exhibition of photographs by 2016 Workspace Resident Lisa Fairstein.

For the series Deep Shade, Lisa Fairstein finds influence in the visual shorthand of web-based photos. Drawn to images made for online consumption, she seeks out isolated poetic fragments worthy of deeper consideration. A mysterious yellow liquid that forms a stark contour on the dark ground, or awkwardly framed limbs gesturing ambiguously - her aim is to heighten the charged and consequential elements of these fractured moments.

Fairstein’s creative process involves sourcing and re-staging these instances, often using printed backgrounds, props and hired models. Her approach gives her photographs an uncanny sense of construction, an element that makes visible the tension between consumption and critique. By capturing the images in higher resolution, and presenting them at a size and speed made for contemplation, she creates slow photographs motivated by accelerated looking.

The title, “Deep Shade,” alludes jokingly to Fairstein’s use of shadow and color, and tonally to an irreverence she finds to be an important component of web imagery. This same wry spirit inhabits much of her work, amplifying the self-awareness and complicity in her relationship to contemporary image culture.

Lisa Fairstein has exhibited at Pioneer Works, NY; the Philadelphia Photo Arts Center, PA; the Wassaic Project, NY; Fresh Window Gallery, NY; Signal Gallery, NY; the Cantor Fitzgerald Gallery at Haverford College, PA ; {TEMP} Art Space in collaboration with NURTUREart, NY; and at Vox Populi, PA. She has been awarded residencies by the Lower Manhattan Cultural Council, the Wassaic Project, and Pioneer Works. She received her Masters of Fine Arts from the School of Visual Arts. Lisa lives and works in New York City.

Ornament Is Crime

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Ornament is Crime
Discover what makes Modernism one of the most important architectural movements in history, with quotes from those who know - and those who feel
Ornament is Crime
"It is a spiritual thing to comprehend what simplicity means." —Frank Lloyd Wright
Ornament is Crime
"Trash is always abundantly decorated." —Le Corbusier
Ornament is Crime
"This goes beyond me beyond you / the white room by a window where the sun comes through." —Radiohead
Ornament is Crime
An unprecedented homage to modernist architecture from the 1920s up to the present day. Ornament Is Crime is a celebration and a thought-provoking reappraisal of modernist architecture. This visual manifesto is a celebration of the most important architectural movement in modern history.