Final Christie’s South Kensington Auction
On the 19th of July, Christie’s auctioned 466 lots of furniture and chattels in what seemed on paper to be a fairly unremarkable interiors sale. The sale was initially presided over by regular auctioneer William Porter, though for the final 100 lots of the sale he stepped aside and let Nick McElhatton bring down the gavel. Dressed in a black tricorn hat and frock coat, in the manner of the firm’s founder James Christie, McElhatton, the Chairman of Christie’s South Kensington presided over an emotional room, with an unusual high number of staff present. When the gavel came down on the final lot of the sale, a table from the boardroom that was being sold for charity, an era had ended as Christie’s had sold its final lot at its second London sale room in South Kensington.
Significance of Christie’s South Kensington
Christie’s South Kensington was a sale room many in the art market enjoyed visiting. The lower price point meant that many collectors made their first purchases at auction there and that Christie’s could offer a much wider and more unusual range of lots for sale. The lots offered there ranged from the possessions of celebrities to design furniture and fashion. This eclectic mix drew a variety of bidders to the rooms, including celebrities, royalty and many private buyers. The sale room also had a much more open and less intimidating feel than Christie’s main premises on King Street. The problem with nostalgia, however is that it is in the past and is rarely as good as you remember it. South Kensington had to close because Christie’s just couldn’t make it profitable.
Similar Situation for Sotheby’s
Sotheby’s closed its second tier London sale room, in Olympia in 2007 for similar reasons. Running and staffing a large premise based in central London can put a massive strain on a company even of Sotheby’s or Christie’s stature. The main earners for international auctioneers are clearly the masterpieces of Modern and Contemporary art, such as Picasso’s “Le femmes D’Alger” version O, which sold at Christie’s New York for the world record auction price of $179.4 million including fees in 2015. If we estimate that the buyer paid no commissions to sell the work (which is highly likely for a work of this calibre) then Christie’s would have made $19.4 million commission, from the buyer on the sale of the work.
This can be contrasted with the sale total of only £1,063,875, (approximately $1.4 million) Christie’s generated for their final interiors sale at South Kensington. Calculating commission can be complex as the charges vary for different clients and lots. But even if we assume Christie’s charged both the vendors and buyers the full 30% (the maximum they charge) they would still only make approximately £638,325 ($840,000), for the sale of 466 lots. The benefit of selling high value lots are clear.
Impact of the Asian Art Market
Another factor which became abundantly clear from Christie’s market reports for the first half of 2017, was the growing strength of the Asian Art market. Christie’s reported a 90% increase in spending on Asian art among Asian clients. Clients from Asia also spent 39% more at Christie’s than the previously across all departments. Quite clearly, Asia and more specifically China are becoming not only significant power blocks with in the global financial markets, but also key new markets for the international art trade.
In 2014, Christie’s opened a 250-square meter gallery and auction space in Hong Kong. This space was to be used for auctions and exhibitions. Crucially Christie’s opened their new space with an exhibition of the best lots they had across international markets. They included Contemporary Asian artists, who were breaking new ground, but they also sought to cultivate interest in the Modern and Contemporary artists who were the staples of the auction market in the west. They were so confident in the venture, that they named the sale room the James Christie Rooms after the firm’s founder.
Increasing Strength of the Online Market
Another key factor in Christie’s decision to close their second London house, which was highlighted in the market report is the increasing strength of the online market. The online market attracted the largest number of new buyers; up 29% and 81% of the lots offered online were sold. Perhaps most interesting was the fact that the average price per lot was £5,731. The expansion of online sales, has offered Christie’s a platform to sell lower value lots effectively without the expense of renting and staffing an additional sale room.
The closure of Christie’s South Kensington has been a crisis for many who worked there, but it has provided an opportunity for the mid and lower tier auction houses who sell the lower value lots Christie’s and Sotheby’s cannot or will not sell, as well as those involved in the Asian art market.
Filling the Void
The auction house most keen to jump into this vacuum is Chiswick Auctions who are opening a sale room in South Kensington run by a former business manager of Christie’s South Kensington, Nigel Shorthouse. This venture, Chiswick say will be “a stone’s throw” away from Christie’s old premises and manned by eight former Christie’s specialists. Whether this new venture will prove a success, only time will tell. What we can be certain of, is the long-term future of the auction house is growing more complex; moving out from the traditional auction room, in the West, Eastwards and into the virtual world.
About the Author
Huw is an experienced art storage and shipping professional with an art history background.