Russians, Chinese and British Diamond Dealer Fueling Art Market

by Tom Johansmeyer (RSS feed)
Feb 8th 2010 at 8:01PM

All secrets eventually come out. At the recent London auctions, in which both Sotheby's and Christie's saw several lots set records, Russian collectors poured some money back into the art market, and Laurence Graff, chairman of Graff Diamonds, parted with a healthy dose of cash. It's this action that caused a combined tally of £258.9 million (including fees), more than double the result a year earlier.

The UK-based diamond dealer sunk £8.1 million into Pablo Picasso's "Tete de Femme (Jacqueline) at the Christie's auction, spending 100 percent more than the high-end presale estimate for the piece. According to Bloomberg News, Graff confirmed the acquisition by e-mail.

Russian billionaires got back into the game, as well, and they exercised better judgment than they did during the art boom, when prices for artists such as Damien Hirst were propelled to absurd levels.

The Impressionist sector has held on rather well, by comparison. "The market for Impressionist and modern art hasn't been as frothy and speculative as contemporary," said Guy Jennings, partner in the London-based dealership Theobald Jennings. "Last year, prices might have slipped five or 10 percent, but since then there's been some asset inflation. That might not be the case in six months' time if there's a double-dip recession."

The new owner of the Giacometti sculpture, "L'Homme Qui Marche I" is the subject of considerable speculation. It fetched more than $104 million which is believed to have been spent by a wealthy collector from an emerging economy. Philip Hook, the Sotheby's senior specialist who represented the buyer over the phone, wouldn't reveal the bidder's identity.

According to Bloomberg News, Roman Abramovich, perennial art buyer, is not the new owner of the Giacometti, and it's unlikely that an experienced Russian collector bought the piece. Says Vladimir Ovcharenko, who owns the Regina Gallery in Moscow, "These guys are businessmen. They have become experienced in art in the past few years and if they wanted to drop $100 million, they'd do it in a different way. There are no fools among them." He believes that the buyer is more likely Middle Eastern or Chinese, adding, "If it was a Russian, it would be a relatively new buyer." But, Russian collectors did become involved in the bidding at both auctions.

Buyers from China, especially, have gained prominence over the past year, as they many of the high profile purchases that signaled hopes of a recovery in October.

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