Blue-chip names are fully priced for anything but the rarest works; but price appreciation continues for a number of under-represented artists.

This commentary by Marion Maneker is available to AMMpro subscribers. (The first month of AMMpro is free and subscribers are welcome to sign up for the first month and cancel before they are billed.)

The rumbling conclusion of the marquee May auctions last Thursday night revealed a mixed bag of interesting results, directional indicators and worrisome disappointments. The biggest theme in the market, rotation from one group of artists driving sales to another potentially rising to fill their place, continues.

And yet, even that conclusion is worthy of cautious qualification. Bloomberg’s James Tarmy astutely observed that the top of the market remained curiously stable:

More than anything, the pinnacle of the auction market is consistent. A year ago, the top 10 works at New York’s May sales totaled $587.4 million, and included a Double Elvis by Andy Warhol, a Van Gogh landscape, a Rothko color field, a painting of a woman by Picasso, and a work by Modigliani.

This year had the exact same list—a total of six artists made the top 10 year over year.

The only change was a modest increase in dollar amount. The May 2019 tally was up 3 percent.

Nevertheless, the theme of market rotation was undeniable in many instances. Phillips did well with its Pop-art heavy single-owner collection from the Fitermans but the estimates tended to be far more aspirational than providing market guidance to buyers. Along with Fiterman, Phillips did good business with Basquiat’s Self Portrait and Mark Bradford’s Helter Skelter II which sold for substantially less than its companion piece which was bought by The Broad.

Like the bigger names that dominate the top ten lists at the other houses, there is a certain market quiet resting upon these works. Recent acquisitions by blue chip names like Cy Twombly are sometimes recycled through Phillips. Artnews’s Annie Armstrong made this observation:

An untitled Cy Twombly chalkboard piece from 1970, estimated at $4 million to $6 million, sold for $4.7 million. It had previously gone for $5 million at Sotheby’s New York in 2015 at its May contemporary art evening sale.

You could view that fact in two ways. Either the market is flat even for some of the best known works by the best known artists or that the asset price of art is fairly stable with a work being unloaded after a short holding period without much loss of value. Both views capture the problem at the top of the market for all but a few works.

For price appreciation, you need to go much further down the value scale to emerging artists like KAWS whose The Long Way Home shocked everyone by selling for $6m. Armstrong maps out for us how that sale fit in with others:

Just before the big KAWS sale, another growing auction force made a new record. Nicholas Party’s richly colored Landscape (2015) went for more than five times its $100,000-to-$150,000 estimate, bringing in a total of $608,000.

Asked about the KAWS after the action, Ed Dolman, CEO of Phillips, told ARTnews, “We knew before the sale that it was going to do pretty well because we had so much interest. But I don’t think anyone was expecting it to make that much of a splash.” […] Another piece by KAWS, Untitled (MBFU9), 2015, this one featuring Snoopy, obliterated its $300,000-to-$500,000 estimate, raking in $1.34 million.

Even with the notoriety surrounding KAWS, Dolman told the Wall Street Journal’s Kelly Crow that he misread the market coming into the sales:

“We should have been more aggressive in getting big pictures this season because it’s fine at the top,” Mr. Dolman said. “We saw real strength up there.”

This is the mystery of the current market. Value seems to very localized in specific works rather than in everything by an artist. Before the sales, there was a fair bit of skepticism about Sotheby’s two top lots. San Francisco MoMA’s curators had already been dismissive of the quality of the work they were deaccessioning to provide a war chest to diversify the artists represented in their collection. The SFMoMA Rothko was widely believed to be fully priced at the low estimate and since it was backed by a third-party guarantee, many observers assumed the sale had already taken place.

It hadn’t. There was aggressive bidding. The work made a round number just above $50m which was quite close to the final price for the Francis Bacon from the Lang collection that came to market with an even lower estimate. At least with the Bacon, the work was backed by Gregoire Billault’s personal history and exuberance. Billault began his career working for the Bacon foundation. His zeal for the work clearly translated to buyers.

Below those two works which made up a third of the auction total, there was a big fall in price achieved to another Bacon work and a giant Christopher Wool word painting both of which sold for around $14m. The Wool’s round number indicated it was sold to the guarantor. According to Judd Tully’s research, Wool’s Fool was acquired four-and-a-half years ago at Christie’s for $14.2m.

Again, that round trip in price is both a good and a bad sign. Wool’s market is mostly dormant. And the word on that Wool is that it was being sold by a very successful market speculator who got caught on the wrong side of a few too many third-party guarantees last season. So this sale was effectively the art market’s version of a margin call with the speculator taking a small loss to switch his investment from this work to the bets he made last season. In a moment, we’ll have a bit more on his market prowess. This graceful retreat from the Wool market may turn out to be a wise and savvy move.

The Master, Judd Tully, also points out two of the early lots in Sotheby’s sale and their previous prices:

California painter Wayne Thiebaud came next with a page-sized 1962 oil painting, Four Pinball Machines (Study), which sold to the telephone for $3.62 million (est. $2 million–$3 million). It last sold at auction at Sotheby’s New York in May 2011 for $3.44 million.

Large-scale figurative painting appeared throughout the evening. Cecily Brown’s richly colored and decidedly sensual Confessions of a Window Cleaner (2000–01) realized $3.62 million (est. $3 million–$4 million). […] The Brown last sold at Sotheby’s New York in November 2006 for $632,000.

One market observer suggests the Thiebaud, which was only able to tread water over an 8 year span despite the elevation of Thiebaud’s market, was being sold by a Parisian private museum owner with a household name. The Cecily Brown, on the other hand, had a 5x increase over 12 and a half years. Although Thiebaud isn’t really a market incumbent, there is something telling about this pairing.

Tully also singles out the strong prices for Color Field painters who seem to be benefiting from the market rotation toward newer, undervalued names.

Color Field painting was also out in force, with Helen Frankenthaler’s lusciously executed Newfoundland (1975) realizing $2.72 million (est. $1.5 million–$2 million), and Kenneth Noland’s Blue, a 1960 target paintings with concentric circles, notching a record $3.5 million (est. $2 million–$3 million).

The places where market stalwarts made progress had some anomalies about them. Here’s Tully’s take on Yusaku Maezawa’s Warhol in the Sotheby’s sale:

Though relatively light in terms of Pop art offerings, there were four works by Andy Warhol in the sale, led by a 24-by-24-inch iteration of Flowers (1964), which saw strong bidding and went for $5.67 million (est. $1.5 million–$2 million). It last sold at Sotheby’s London in June 2014 for £1.76 million (about $3.01 million).

It’s hard not to conclude that the $5.67m price was a function of Maezawa’s provenance and whatever notoriety might attach to it.

Artsy’s Nate Freeman was paying attention later in the sale when Barkley Hendrick’s Yocks, sold just two years before at Sotheby’s for a record price, was able to vault to a much higher price:

Yocks (1975) eventually went to Sotheby’s head of contemporary art in Asia, Yuki Terase, for a $3.1 million hammer, or $3.74 million with fees. The previous record for the late artist, whose market has skyrocketed in the last year, was $2.17 million.