A Mao by Warhol sells for below estimate at Hong Kong auction, casting doubt on Asian appetites for Western contemporary art

Sotheby’s sells 1973 portrait of Chinese leader for hammer price HK$4 million under low estimate in Hong Kong, and a Keith Haring fails to sell

PUBLISHED : Monday, 03 April, 2017, 11:09am
UPDATED : Wednesday, 05 April, 2017, 10:53am

A portrait of Mao Zedong by Andy Warhol sold for less than its pre-sale estimate and a work by Keith Haring failed to sell at Sotheby’s modern and contemporary art evening sale in Hong Kong on Sunday, casting doubt on Asian collectors’ appetite for top-end Western contemporary art.

Auction houses started bringing contemporary Western art to Hong Kong last autumn in response to the Asian auction market surpassing the US market and the growing participation of Asian bidders in New York and London sales. Early results of the move were promising. Asian collectors bought works by the likes of Haring, Gerhard Richter and Jean-Michel Basquiat at a special Sotheby’s sales curated by Korean pop star T.O.P. last October (though a Warhol failed to sell).

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Christie’s also claims strong demand for the Western art it offered in its “Loaded Brush” private sale in November.

But on Sunday, demand for Western art valued at above US$1 million was tepid. Warhol’s Mao, executed in 1973 and one of his many works of the former Chinese leader, was estimated at HK$90 million (US$11.6 million) to HK$120 million (excluding fees) before the sale, and Sotheby’s laid the groundwork to help it sell. The eye-catching portrait in red was one of three works in the evening sale backed by a guaranteed, irrevocable bid; for the Mao portrait, Sotheby’s chief executive officer Tad Smith bid HK$84 million on behalf of a client.

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However, the work sold at a hammer price of HK$86 million, or HK98.5 million with fees. That did not leave much profit for the seller, a European collector who bought the painting for US$12.2 million (around HK$95 million) including fees in 2014. Chinese buyers have often splashed out on Warhol’s Mao portraits in the past, including Hong Kong billionaire Joseph Lau Luen-hung, who paid US$17.4 million for a bigger version in 2006.

Watch Warhol’s Mao (1973) go under the hammer in Hong Kong

This could reflect cooling demand for Warhol’s work in general. The recent Art Basel UBS art market report by Clare McAndrew reported a 68 per cent drop in auction sales of Warhol works in 2016.

There was also speculation before the sale that collectors from China deemed buying Mao images politically incorrect. In 2012, the exhibition “Andy Warhol: 15 Minutes Eternal exhibition”, which came to Hong Kong first, had to drop 10 Mao images when it moved on to Beijing and Shanghai.

There were two other paintings featuring Mao in the same sale. Wang Guangyi’s Mao Zedong OU (1989) sold for HK$1.6 million, above the highest estimate, and Liu Wei’s Mao Generation (1992-99) sold for HK$9 million, below the lowest estimate.

In general, demand was spotty throughout the evening sale, the second in Sotheby’s week-long spring sales. Ten of the 59 lots were sold below their lowest estimates, six were unsold and six were sold at the lowest end of their estimates.

The evening sale’s final tally was HK$574 million including fees, compared with HK$509.2 million in the October sale.

Unusually, the sale of Haring’s 1982 Untitled (diptych) was reopened a few minutes after it was passed at HK$11 million, but that bid was not bettered and it was passed a second time. Another Warhol, called Ten One Dollar Bills (1962), sold for HK$950,000, well below the lowest estimate of HK$1.8 million.

The Chinese artworks that didn’t sell were Zhang Xiaogang’s Bloodline: Mother and Son No. 1 (1993), Deux nus allonges; Nu (double-sided) by Sanyu and Chess Match of the Century; Walled City III (1996-98) by Xu Jiang, nephew of Jiang Zemin.

But there was strong demand for southeast Asian and Japanese art, which accounted for most of the eight artist auction records set during the evening sale and the earlier “Brushworks II” sale, a curated sale of 25 abstract paintings at which all the works sold for a combined HK$89.6 million including fees.

This could well be a sign that less money is flowing out of mainland China because of the economic slowdown and capital controls
Beryl Chan

A new auction record was set during the evening sale for Vietnamese artist Le Pho. His Family Life (1937-39) was sold at a hammer price of HK$7.5 million, compared with a valuation of HK$1.8 million to HK$2.4 million before the sale. There was also a new auction record for Joseph Inguimberty, a French painter who was an influential teacher at the École des Beaux-Arts de l’Indochine in Hanoi. His Le Hamac (1938) sold at a hammer price of HK$6.2 million, well above the top estimate of HK$2.8 million.

A new record was set for Tanaka Atsuko, the Japanese Gutai Group painter, during the “Brushwork II” sale. Her Work (1963) fetched a top bid of HK$10.5 million, beating the highest estimate of HK$9 million.

One independent art consultant present at the sale observed that demand seemed to be coming mainly from regional collectors from places other than China, a trend that was also noticeable during the Art Basel Hong Kong fair last month – though this lack of enthusiasm could simply mean collectors were preserving firepower for upcoming sales at other auction houses.

“This could well be a sign that less money is flowing out of mainland China because of the economic slowdown and capital controls. We are seeing southeast Asian and Japanese buyers propping up the market. At the same time, there are competitive offerings of contemporary art by other auction houses coming up, so maybe the market hasn’t cooled, and collectors were simply waiting,” said Beryl Chan Man-yu.

Editor’s note: this story was updated on April 5 to include new information provided by Sotheby’s