HONG KONG: Hong Kong auction houses are looking for novel ways to keep their sales buoyant in the face of China’s economic slowdown - from creating boozy bidding parties to selling items from outer space.
The recent sales season in the city saw the familiar glittering parade of art, jewellery and rare wines. But although billionaire Asian collectors have grabbed headlines with recent mega-buys, takings were down at major Hong Kong auction houses.
Now auctioneers are trying to develop fresh strategies to woo increasingly picky collectors.
New Hong Kong auction house Dragon 8 says it is trying to break the traditional mold of stuffy auctions by creating invite-only sales fuelled by good wine and food.
“I’m up there putting on a show for these people,” said founder Gil Lempert-Schwarz. “I serve them wine, we eat food. There’s a set-up limit: around 45 seats around tables.”
Most buyers are from Hong Kong and China, bidding for high-end lots of diamonds, fine art, wines and whiskeys.
One spent thousands of dollars on a bottle of champagne then shared it with the room at Dragon 8’s inaugural auction last month, said Lempert-Schwartz.
MONEY SHOT
Dealing in rare coins and paper money may be at the less sparkly end of the auction spectrum - but leading US-based numismatic auction house Stack’s Bowers added an interstellar element to its sale in Hong Kong this month. It featured a coin and stamps taken onboard China’s unmanned Shenzhou 1 spacecraft, sent into orbit in 1999.
Stack’s Bowers said there was a growing desire among Chinese collectors to repatriate heritage items.
“We’re finding Chinese and Asian coins from all over the United States and the vast majority are being sold to Chinese and Asian buyers,” said president Brian Kendrella. “Our collectors want to repatriate these collectibles that have left the country, now that specifically mainland China is in a place where wealth is growing quite rapidly.”
The space collectibles failed to sell - but a Chartered Bank of India, Australia and China note from 1863, issued in Hong Kong, went to an Asian collector for more than US$100,000, five times the estimate.
TRENDY TIPPLES
Auctioneers are also trying to spot potential new niches.
Wine and whiskey expert Daniel Lam of Bonhams Asia predicts collectible sake could be the next big thing for booze fans.
“I think we will see more sake auctions and even Chinese kaoliang (strong sorghum wine) auctions, already happening in Hong Kong and Taiwan,” says Lam.
While the market for wine remains healthy, prices have dropped and whiskey has taken over as “the hippest drink in the world,” he adds.
Bonhams set two world records at its Hong Kong whiskey auction in August.
But Lam says it is important to look ahead, and sake could meet the demand in Asia for rare luxury items.
“They only sell super premium sake by allocation, and there are often not more than 100 bottles,” says Lam. “The scarcity and the limited bottling push up the demand. Getting the most highly regarded product is a status symbol.”
BUYER CAUTION
November saw Chinese tycoon Liu Yiqian buy Modigliani’s “Nu Couche” in New York for us$170.4 million.
The same month, Hong Kong billionaire Joseph Lau snapped up diamonds worth almost us$80 million at Sotheby’s and Christie’s in Geneva.
Yet auction houses say the overall mood is cautious, says Nicolas Chow, Sotheby’s deputy chairman for Asia.
“If you compare the market to where (it) was in 2010, 2011, when there was a lot of hot money coming in from China... everything sold,” he told AFP. “People were just throwing money around... We’re very far from that climate today.”
There are fears that the combination of an economic slowdown in China and an anti-corruption drive by President Xi Jinping could hit the Asia market - both Sotheby’s and Christie’s posted lower totals at their autumn sales in Hong Kong than in the two previous years.
Christie’s described its results as “solid” but said buyers were becoming more selective.
Attracting new collectors is key, says Rebecca Wei, president of Christie’s Asia.
“When we consider the new client penetration rates by Christie’s and across all leading auction houses, we find that the figures are still quite low,” Wei told AFP.
Educating potential collectors and providing more accessible information to create “a less intimidating buying process” is part of the strategy, says Wei.
An uncertain global economy and questions over buyers’ willingness to spend make the auction house “cautiously optimistic” about the future, she adds.
“It is slightly early to see the road ahead clearly, however the optimism stems from new buyers enthusiastically entering the market,” says Wei.
Both Sotheby’s and Christie’s believe it is more important than ever to carefully curate collections.
“For as long as we compose a sale carefully, tidily, I’ve got a lot of confidence in the years ahead,” says Chow. - AFP
Limited time offer:
Just RM5 per month.
