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Cold, Cold Art

Baroque Egg with Bow (Turquoise/Magenta) by Jeff Koons. Photo: Sotheby's

Is the art market on the verge of an ice age?

Last week, the all-important contemporary art auctions were held in New York. The big houses raked in tens of millions of dollars—Sotheby’s hit $47 million in its May 12 evening sale, and Christie’s did $93 million the next night—and set a few records. But no matter how they tried to spin it, those sums were relatively skimpy. Christie’s brought in three times more last year, and the big lot at Sotheby’s, Jeff Koons’ Baroque Egg with Bow (Turquoise/Magenta), which had been shopped around for $20 million, sold for $5.5 million.

The problem isn’t just lack of enthusiastic buyers. This isn’t the housing market, where there’s been a flood of inventory and a resulting drop in prices. We’re talking about art collectors, people who are less likely to need cash. A lot of potential sellers have decided to stay out of this mess, helping to freeze the market up.

“People are holding on to their art,” Michael McGinnis, worldwide director of Phillip de Pury’s contemporary art department, told the New York Times last week, after its sale brought in just 63 percent of the low estimate.

We heard the same thing from a friend who heads a department at a smaller auction house. Prying quality work loose from owners’ hands is no easy task in a weak market, he said. Anyone who can afford to wait for higher prices is doing so.

Cry me a river, you say? It’s not just auction giants that are getting a comeuppance. Anecdotally, it seems like smaller art businesses are taking a harder hit. We don’t want galleries, art shows, artists to go away, and you probably don’t either.

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