Three pieces could sell for $100 million each

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Nearly $2 billion worth of art will come up for auction in New York over the next week, marking the biggest test of the art market since the start of the Iran war.

The major auction houses are counting on blockbuster works from famed collections to carry the market past the gloom of geopolitical conflict and volatile financial markets. Despite growing fears of a slowing global economy and a potential lack of buyers from the Middle East, dealers and art experts say the rapid rebound in the art market that began last fall shows no signs of slowing.

“Buyers are engaged and looking for opportunity right now,” said Philip Hoffman, chairman and founder of Fine Art Group, the art advisory and sales agency.

Hoffman said today’s megacollectors, like Ken Griffin, Steve Cohen, Jeff Bezos and the new crowd of Asian tech billionaires, have seen their fortunes skyrocket in recent years and are looking for long-term stores of value.

“They’re sitting on massive amounts of liquidity,” he said. “To them, this money is peanuts.”

Three works coming to auction are estimated to sell for up to $100 million, and over 20 works are estimated at $20 million or more, more than triple last year’s total. Sales for the three auction houses are expected to total between $1.8 billion and $2.6 billion, according to ArtTactic. At $2 billion, the sales would nearly double last year’s total.

Marc Porter, chairman of Christie’s Americas, said the crowds lining up to see the works for sale are the largest in nearly a decade.

“There is an energy and buzz in the rooms that we haven’t seen in a while,” he said. “It’s difficult to tease out whether that’s about the quality of the works of art, or the world situation and art is a refuge, or art is a hedge. It’s tough to tell. We’ll know in a week or two.”

The sales are set to continue a rapid rebound in the art market that began last fall. In 2023 auction sales started declining as sellers held back their top works. Without supply, especially at the high end, sales totals fell and many galleries started cutting back or closing.

Last fall, however, with a few big collections coming up for sale, sales snapped back. The recent auctions in London – including a $175 million “white glove” sale at Sotheby’s – showed strong bidding across almost all price points and categories, advisors say.

The success of this month’s sales in New York will hang largely on a handful of trophy works from well known collections. Christie’s is offering works from the collection of Samuel Irving “S.I.” Newhouse Jr., the media titan who died in 2017.

The headliner of the collection is “Danaide,” a 1913 sculpture by Constantin Brancusi estimated to sell for $100 million. A large-scale Jackson Pollock drip painting titled “Number 7A, 1948” is also estimated at $100 million.

Christie’s is also selling works from the late collector Agnes Gund, including Mark Rothko’s “No. 15 (Two Greens and Red Stripe)” estimated at $80 million.

A Rothko also headlines the collection of the late Robert Mnuchin being sold at Sotheby’s. Mnuchin, the former Goldman Sachs partner-turned-gallerist and father of former Treasury Secretary Steven Mnuchin, was a major collector of Rothko, Willem de Kooning, Franz Kline and other abstract expressionists.

The auction includes Rothko’s towering “Brown and Blacks in Reds” estimated at $70 million to $100 million.

Advisors say the previous ownership history of an art work  – known as “provenance” – matters more than ever. Art sold by famed collectors like the Rockefellers, Paul Allen, the Lauder family or Newhouse carry ever-higher premiums as new collectors look for validation.

Collectors like Newhouse “were connoisseurs,” said Betsy Bickar, head of art advisory at Citi Private Bank. “They were buying art because they understood the importance of the piece that they were going after. So they were willing to pay any price.”

The wild card for the auctions is the Middle East. The governments and royal families of Saudi Arabia, Qatar and the United Arab Emirates — particularly in Abu Dhabi and Dubai — have been on an art spending spree in recent years as they build new museums. Some say the war could cause the countries to focus more of their capital on rebuilding at home rather than buying art.

Dealers and art experts say Middle East buyers have mainly been active in private sales rather than public auctions, so the impact this season may be limited. And despite the war, many say the Middle East leaders remain committed to the long-term importance of building cultural institutions to diversify their economies.

“There are Middle Eastern buyers who are still looking to bolster the holdings of these new museums, and making sure these museums have real quality work,” Bickar said. “I wouldn’t be surprised if you see a lot of Middle Eastern buying in this round of sales.”

Americans, however, have been the driving force in the global art market for years. Porter said that even if bidding from overseas buyers is light, the New York sales look promising.

“The bulk of buying is American buying,” he said. “Americans who have money in the stock market or who are in the financial markets or in the technology markets, even the real estate markets, are all making a lot of money and buying works of art. The Europeans have been consistent and strong. The Asians, particularly the mainland Chinese, a little bit less represented, but still very strong.”

Many of the top works carry third-party guarantees or irrevocable bids, meaning a buyer has already agreed in advance to purchase the works at a minimum price if there are no higher bids at auction. While the practice removes some of the excitement of live auctions, it’s become increasingly common as auction houses and sellers look to reduce their risk.

“We advise our clients to take guarantees,” Hoffman said. “It’s a win-win situation.”