NY art auctions shrink in size, but not in price

By Christopher Michaud

NEW YORK (Reuters) - With fewer works on offer, the upcoming spring art sales seem pared down from the gargantuan affairs of recent seasons, but the steep prices for top works confirm a belief at auction houses that the art market boom will continue to defy an increasingly shaky economy.

In particular, officials at both Christie's and Sotheby's say, the international market spanning Russia, the Mideast, China and beyond can be expected to continue driving the kinds of unprecedented prices that have marked the past decade.

"We've taken into account that the U.S. economy has slowed, and some buyers are not in the same situation," said Marc Porter, Christie's president.

"But on the other hand, Russian and Middle East collectors are richer than ever," he told Reuters. "There are enormous amounts of cash piled up," Porter said. "We're continuing to see incredible strength for the very best things, especially in the international markets."

Sotheby's Impressionist and modern art co-chairman David Norman agreed.

"The sliver of super-wealth in the world is still just so extraordinary," he said, while Chief Executive William Ruprecht noted that oil wealth was stoking the market far more than hedge fund players as many believe.

Norman added: "It's a different feeling from a year ago, a different environment. There's increased resistance to aggressive estimates, a little more soberness and a sense of discipline."

Sotheby's got burned in November when its Impressionist and modern art sale fell short, sending its share price tumbling. It bounced back with a spectacular contemporary sale the following week as well as strong results in London in February. Fourth-quarter profit last year rose nearly 50 percent.

UNCERTAIN TIMES, HIGHER PRICES

At an uncertain time, the archrivals of the high-stakes auction world have assembled tightly edited sales and expect to set significant artists' records as works by Picasso, Monet, Warhol, Rothko and especially Francis Bacon hit the block.

"Our focus is on quality, not on quantity," Ruprecht said recently, which could help explain why some sales are 20 percent smaller than last year.

The top-priced lot in a fortnight of auctions that will likely total more than $1 billion is Bacon's "Triptych, 1976," which is expected to command in the neighborhood of $70 million at Sotheby's. Christie's has its own Bacon Triptych, "Three Studies for Self-Portrait," bearing a pre-sale estimate of more than $30 million.

Each house also has a top-tier Rothko estimated at around $40 million, which along with the Bacons shows the continuing acceleration of the contemporary and post-war market.

Robert Manley, head of contemporary and post-war art at Christie's, pointed out that while its contemporary sale has shrunk by 10 lots in each of the last two seasons, the expected take from the auction has actually grown by nearly 20 percent.

"Rising markets tend to bring out the best pictures," he said.