| Sotheby's Financial Services will lend collectors up to 50 percent of the low estimate of an artwork even if it's not immediately put up for sale. The terms of the loan restrict the collector from selling the property elsewhere for a period of time even after the loan is repaid. Competition between the houses, says Porter, is "brutal" and "relentless" - so much so that Sotheby's declined to make any of its specialists or executives available for this article, stating in an e-mail message, "How we compete and how we win business is highly proprietary." The auction houses have about three months between the end of one season and the catalogue deadline for the next to line up property. They are geared to act quickly because the most aggressive deal can shut out the competition, and because once great material is won, it can be advertised and beget more great material. "Christie's and Sotheby's comb the pages of the obituaries, and if they hear of anything." When Hester Diamond decided to sell modern artworks from her collection last August, she invited Sotheby's and Christie's to come to her Manhattan home and look at her collection. "I was having work done on my house at the time," says Diamond. "I told them the work should be done in about two or three weeks and they could come by then." But neither firm wanted to wait. Sotheby's insisted on coming by that afternoon, and in a matter of days had turned out a mock-up of the catalogue, including entries for her works and optional covers. When Christie's won the Victor and Sally Ganz collection in 1996, it went so far as to present the consignors with an architectural model displaying how their pictures would be installed museum-style in the firm's galleries. In the early 1990s, when he was working at Christie's, Findlay remembers, he was responsible for the timely delivery of a proposal that had been tied with a grosgrain ribbon to a Japanese client. So concerned was the then head of Christie's in Japan with presentation, says Findlay, that she held up the delivery, "insisting that the ribbon be ironed." Presentations for important consignments can involve a half-dozen people, including the chief executive, the director of marketing, the chief financial officer, and the auction house's legal counsel. Among the senior executives Diamond says she met with were Tobias Meyer, Sotheby's auctioneer and worldwide head of contemporary art ; Charles Moffett, Sotheby's co-chairman of Impressionist and modern art ; Warren Weitman, chairman of Sotheby's North and South America ; and Sotheby's chief executive officer William Ruprecht. Christie's delayed its first meeting with her for a few days, says Diamond, so that its chief executive, Edward Dolman, who was not immediately available, could meet with her from the start. But by then, Diamond, impressed by Sotheby's creativity and efficiency, says she had nearly made up her mind to give Sotheby's the consignment. There was some back-and-forth over what each auction house was willing to offer, says Diamond, but the amount of the guarantee was a "crucial factor" in her decision to consign the works to Sotheby's, as were subsequent negotiations over what the split beyond the guarantee would be. Sotheby's reportedly guaranteed Diamond $65 million for six modernist works by Vasily Kandinsky, Constantin Brancusi, Piet Mondrian, Fernand Lger, and Picasso-an offer that "was dramatically different from Christie's," says an auction house source. Diamond's property brought in $39 million, about two thirds of its reported guarantee. Mondrian's New York/Boogie Woogie (1941) fetched $21 million, a record for the artist at auction, and Brancusi's The Kiss (ca. 1908) sold for $8.9 million, but Kandinsky's Sketch for Deluge II (1912), estimated at $20 million/30 million, failed to sell, as did Picassos Baigneur et Baigneuses (1921), estimated at $8 million/12 million. Christie's and Sotheby's deal as much in glamour as in art, and one of the fundamental ways they compete is by wooing consignors. "Theyll throw a party for a consignor's family, fly them to New York, put them up in a hotel, bring in a girlfriend or boyfriend," says a source. "Little things that don't add up to a lot financially but seem to make clients happy." Specialists from both firms wine and dine collectors lavishly, compliment them profusely, offer free appraisals of their collections for insurance and tax purposes, help with loans and restoration, and even employ their children. "Within the auction houses, there is a debate over whether it's better for the children of collectors to work at your auction house or at your competitor's," says a former auction house executive. "It can backfire. The potential client can get an inside view that an auction house doesn't want them to have. They can learn about a dropped work or someone putting a hole through a very expensive painting." One former auction-house executive recalls being accompanied on an exhibition tour to Tokyo, Geneva, and London by the stepdaughter of the consignor, her adolescent daughter (who refused to eat anything but hamburgers and french fries) and the consignor's attorney and his wife, who were in the midst of "very serious marital discord," says the source. "It was like a circus. One's purpose is to show paintings to clients, but one ends up having to look after a group of dysfunctional people going around the world on your dime, demanding ketchup." Other ways to win over clients include inviting them to boardroom lunches, making donations to their favorite causes (Christie's made a $50,000 contribution to the Brooklyn Museum when it showed "Sensation," an exhibition of works by Young British Artists owned by frequent auction consignor Charles Saatchi), and offering the use of their premises for panel discussions and charitable events. Potential consignors "are like sitting ducks," says a former auction house specialist. The auction business is about "nurturing the ducks, waiting for them to fly, and then taking your best shot." Christie's, for one, produced a catalogue of John and Frances Loeb's art collection for family purposes 20 years before winning a consignment of works from the Loeb estate in 1997, according to sources. The firm's prior research on the collection formed the basis of a single-owner catalogue for the sale, which grossed $93 million. |
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