Art Market Forecast: 2011

© Bharti Kher /Stefan Altenburger Photography Zürich/Hauser & Wirth

Are the go-go days of 2007 back? As Stephen Wallis reports,
we’re getting closer.

As the modern and contemporary art market gears up for its
first bellwether events of 2011 (the big winter auctions in London, major fairs
in Madrid and New York), confidence among buyers and sellers is surging. The
mood is considerably brighter than it was a year ago, when optimism about a
recovery was checked by unease about a possible double dip. Global economic
concerns remain, for sure, but recent months have seen spectacular sales not
only in modern and contemporary art but also in fields as diverse as Chinese
ceramics, antiquities, photographs and Old Masters. This is an art market
that’s definitely gotten its swagger back.

“There was a period of a year and a half where everyone was
retrenching,” says Marc Spiegler, codirector of the Art Basel contemporary art
fairs. “Galleries started doing fewer shows, they stopped printing invitations,
people weren’t underwriting catalogues and museums exhibitions. But now I see a
lot of galleries taking new spaces, investing in the production of new works
and expanding their programs. They wouldn’t be doing that if they thought the
market was shaky.”

Things are certainly healthy at the top end. A week after
Sotheby’s kicked off the November auctions in New York by selling a Modigliani
painting for $68.9 million, Phillips de Pury & Company hammered down Andy
Warhol’s 1962 silkscreen painting Men in Her Life (featuring images of Liz
Taylor, Michael Todd, Debbie Reynolds and Eddie Fischer) for $63.3 million. It
was the star lot of the auction house’s buzzy, $117 million inaugural Carte
Blanche sale, organized by private dealer Philippe Ségalot, and the first
auction in Phillips’s shiny new Park Avenue digs.

Things picked up from there: $42.6 million for Roy
Lichtenstein’s Ohhh...Alright... at Christie’s; $35.3 million for Warhol’s
Coca-Cola (4) [Large Coca-Cola] at Sotheby’s, bought by hedge fund billionaire
Steven Cohen; two different Gerhard Richter paintings at Sotheby’s and one at
Christie’s, each going for well north of $10 million. In 2009 Sotheby’s and
Christie’s fall contemporary evening sales in New York totaled $208.5 million
combined. This past autumn, that figure was $495.3 million.

The emergence of wealthy collectors from Asia, the Middle
East and South America in recent years has deepened the pool of buyers,
especially for top-end masterpieces, and many of them remained in the market
during the recession. Americans, who had largely stopped spending, started to
return last year and are now back in full force. “It’s a very healthy market,”
says Tobias Meyer, worldwide head of contemporary art at Sotheby’s. “On top of
the global buyers—the icon chasers who have dominated the very high end of the
market—there is a solid, affluent American collecting base that is looking to
buy up to the $10 million to $15 million range.”

The story was much the same in early December at Art Basel
Miami Beach, where, Spiegler says, “Everyone reported that the Americans are
back—museums were buying, private collectors were buying. And you had
collectors showing interest in young artists, which in the previous two years
hadn’t been the case as people flew toward surer values, more established

One sign of confidence was the number of large works,
especially sculptures, that dealers brought to the fair. Hauser & Wirth,
which has galleries in Zurich, London and New York, sold large sculptures by
both members of India’s leading art couple: a seven-foot-high marble tiffin
lunch pail by Subodh Gupta ($400,000) and Bharti Kher’s Solarium Series I, an
enchanting lifesize fiberglass tree with animal heads dangling like fruit
($365,000, pictured). New York gallery Sikkema Jenkins & Co. sold Mark Bradford’s The
Throat Would Let Go, a massive canvas even by the standards of this now
full-fledged superstar, for $375,000. And sales by Lehmann Maupin, also in New
York, included a pair of large rhinestone-encrusted paintings by Mickalene
Thomas, featuring an odalisque-like “Mama Bush” figure on a sofa, for around
$75,000 each.


The Swiss gallery Gmurzynska, whose dynamic black-and-white
booth was custom-designed by Zaha Hadid, sold four works by Yves Klein,
including one of the artist’s signature IKB 93 blue pigment paintings from 1961
for around $4.5 million. Hanging next to the Klein was Mark Rothko’s luminous
1957 painting Saffron (asking price: $30 million), which was on reserve as of
press time.

Over at the Design Miami fair, which moved from the Design
District to a location adjacent to Art Basel, sales were also robust. Paris
dealer Patrick Seguin nearly sold out his showstopping India Mahdavi–designed
booth filled with pieces by Jean Royère on the first day, including the
supersoft and elegant 1949 Ours Polaire sofa and pair of armchairs for
$800,000. “Everybody seemed pretty happy,” says the show’s cofounder, Craig
Robins. “Some of our best dealers had not attended the show for a couple of
years, and they were back. And there was none of the negativity you sometimes
hear from dealers—what that means is they were selling.”

We’re even seeing a return of the kind of investment-driven,
speculative buying that had largely disappeared for the last two years. “A
younger group of professionals are looking at art collecting as a pleasure but
also as something that can be an alternative asset class,” says Mathias
Rastorfer, co-owner of Galerie Gmurzynska. “We all thought the speculative
buying was gone, but it has reemerged in certain areas, and I believe it will
increase in 2011.”

So are we headed back to 2007 all over again? Not quite.
We’re not in “a silly market,” as Spiegler puts it, where everything sells.
Rastorfer adds that “everyone is more realistic than they were a few years

The big difference between then and now, says Meyer, is that
“the market in 2007 was less discriminating. Back then you had a lot of jpeg
buying—people just making decisions based on seeing something on the Internet.
I think that people don’t do that anymore. There’s more education and more
information gathering.” Perhaps that’s one reason (technical problems were
another) the inaugural online VIP Art Fair, held at the end of January, failed
to deliver many significant sales, despite the high caliber of the
participating galleries and loads of media attention.

Still, expectations are high for the Impressionist, modern
and contemporary auctions beginning in London this week. Christie’s
Impressionist and modern art sale on February 9 has a top estimate of $175.4
million—the second-highest ever for the winter session—led by a Tahitian-period
still life by Paul Gauguin with a $16 million high estimate. Sotheby’s is
particularly enthusiastic about its trove of 60 works from a European couple
that will be offered in a session billed as “Looking Closely: A Private
Collection.” Highlighted by Francis Bacon’s 1964 triptych Three Studies for a
Portrait of Lucian Freud (estimate: $11 million–$14 million), the group is
expected to fetch more than $70 million. “That’s gonna go crazy,” says Meyer.
“It’s what the market hasn’t seen, and the quality is incredible.”

Looking ahead, Meyer says the biggest problem the market
faces is supply. “Demand is there,” he says. “That’s a sign of a healthy