Tens of millions of dollars of art went unsold at major auctions in Hong Kong and London in September and October. Then with the Nov. 3 start of the important fall season in New York, sales of Impressionist and Modern paintings at Sotheby's came in more than $100 million below the auction house's low estimate. And last week, as Christie's in New York prepared for its contemporary art sales, consigners were urged to lower expectations and collectors were quietly advised to ignore estimates and "basically bid anything.""Everybody is concerned about what is happening," said Rena Bransten, who opened her gallery in San Francisco 30 years ago. "I've gone through this before, but this is so different because it's global. And, part of being a dealer is not only selling art but supporting your artists."While parts of the art market remain healthy, the global financial turmoil that has decimated portfolios and pummeled emerging markets is having another impact that some see as positive: The gravity-defying prices of recent years are being adjusted."We're seeing a correction whose time has come," said Gretchen Berggruen, co-owner of the John Berggruen Gallery in San Francisco, which opened in 1970 and specializes in 20th and 21st century American and European art.The worldwide art market, comprised of more than 150 submarkets - including everything from painting to furniture - is expected to have sales this year of $38 billion, excluding revenue from China, India and the Persian Gulf states, according to David Kusin, a Dallas analyst who specializes in the economics of the global art market.Kusin, a former curator at the Metropolitan Museum of Modern Art who founded his business 10 years ago, advises institutional clients on such things as which kind of painting makes the best investment and whether it's better to sell in Paris and buy in Cologne, Germany, or whether the time is right to sell 18th century English case furniture."Parts of the market remain strong," he said last week, and other parts are "positively toxic."The strong areas in the market include 17th century Dutch landscape paintings, 15th century Northern European sculpture and 19th century ceramics, he said. The weakest part, Kusin said, is contemporary art, particularly works by unseasoned artists. Kusin considers many contemporary artists - notably Damien Hirst, best known for his animals in formaldehyde - a "flash in the pan who will not be remembered in 100 years.""Damien is a good businessman, but in 100 years, people won't know who he is," Kusin said. "Contemporary art sales, on a relative basis, will be very disappointing. The primary buyers of hot contemporary art are those whose incomes are most at risk today. The people who are still buying are the older collectors with more stable money."Martin Muller, owner of Modernism Inc. in San Francisco, attended the Nov. 3 evening sales of Impressionist and Modern art at Sotheby's. He watched as a 1916 Suprematist work by Kazimir Malevich was bought for $60 million. The sale - a record for the artist - was negotiated before the auction began. He also saw a 1918 painting by Modigliani, expected to fetch up to $25 million, fail to generate a bid."People were ready for the worst, but the worst didn't happen," said Muller, who opened his gallery in 1979 and specializes in modern and contemporary works and the Russian avant-garde. "The works that sold either went at or below the low estimate."Peter Fairbanks, owner of San Francisco's Montgomery Gallery, worked for Sotheby's in London in the 1970s and Phillips in New York during the 1980s, losing his job in both cases because of the economic upheaval of the time."I've been through recessions, just not as severe as this," he said. "During these down times, I turn to other work. I do appraisals. I authenticate paintings."Trying to be optimistic, he said, "There are bubbles in all kinds of business. The art business is not immune. But it will recover. Sometimes you learn through suffering."E-mail Julian Guthrie at jguthrie(at)sfchronicle.com.(Distributed by Scripps Howard News Service, http://www.scrippsnews.com)
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