A Tale of Two Hirsts: A Look at the Spotty Nature of Auction House Estimates
Next Wednesday evening, Phillips will hold its first-ever editions sale in London, offering 92 lots ranging from early 1900s Matisse monotypes to hot-off-the-presses contemporary prints. The inaugural sale in the UK comes after several successful seasons of edition sales in New York. Two very similar lots near the end of the sale by everyone's favorite art star, Damien Hirst, with wildly different price estimates, caught my eye as I was scrolling through the catalogue.
Looking at the online preview of the sale, the works on my screen were ostensibly the same — six dots by eight dots of various different colors — yet the first, lot 87, is estimated to bring £20,000-30,000. The second, lot 91, carries a mere £5,000-7,000 estimate. Just to be sure, I checked to make sure that the works were of similar size (they are), and that they were both signed (they are). Lot 87 was made in 2008 and is one of 100 prints plus 20 artist editions. Lot 91 dates all the way back to 2007 and is numbered 13/45 — meaning it's more than twice as rare as the more expensive of the two. So why is lot 87 worth four times as much as lot 91?
It appears that the answer lays in the process, according to Phillips's print specialist in London, Robert Kennen. In the case of lot 87, each dot was individually inked, while in lot 91 the dots were etched all at once. Lot 87 might be described as "Damien Hirst playing with the notion of what’s unique," said Kennen. The spots in each of the 100 versions of the Lot 87 print are different, whereas the 45 in Lot 91's run are the same. Essentially, there was more care and attention to detail put into the more expensive print, despite the fact there were more of them made, and presumably up close it is easier to tell the differences between the spots.
But still — why does this make a print worth four times as much?
I didn't have to ask the question because Kennen beat me to it. "I wish we had full control of every estimate," he said, adding, "sometimes the consignor demands a particular price." So the real answer to this mystery is that art collectors are fickle, and sellers aren't always willing to accept the quoted market price for a work. Estimates end up being higher than a seller can realistically hope for either because they haven't been paying attention to market fluctuations (for Hirst, this has been especially important in the last few years), or they attach too much emotion to the artwork. At the end of the day, the auction house cannot force a consignor to lower his or her reserve price.
The New York Magazine profile of Larry Gagosian had a great anecdote about this. Collector-dealer Alberto Mugrabi told Sotheby's director Alexander Rotter that the auction house’s estimate was absurd given the current state of the market:
When Mugrabi got off the phone with Gagosian, he immediately phoned Alexander Rotter, a Sotheby’s director. “The Hammer and Sickle will be difficult,” Mugrabi said. “This painting should be much less than that, you know?” He told Rotter that “at the height of the market,” he had sold “a painting like this” for $3 million. “But it’s insane that the market has gone down and I have to pay the same price because there is some stubborn guy?”—meaning [collector Josef] Froehlich—“That’s surrealist. He’s a surrealist.” When Rotter attempted to say his piece about the consignor’s attachment to the painting, Mugrabi got agitated. “Obviously, he’s putting the painting because he wants to fucking sell it, not because he wants to, you know? If he wants to sell the picture, tell him to be realistic … Which is only better for him and better for me.”
This story doesn't make Mugrabi seem like the nicest guy — but he's right. The lack of standardization in the art market can make works hard to estimate, but adding collectors' emotional attachments to their art can kill a work's chance of actually being sold. Of course, the flip-side of the astronomically high asking price is actually getting someone to bid that much — the risky bet can pay off big time. But with Hirst's market having lost a third to half of its value since 2008, and a very similar work being sold with a much lower estimate just four lots after the first one (not to mention having several other Hirst works in the sale) the likelihood of that is very low. Then again, if you won't part with a £5,000 work for less than £20,000, then perhaps you aren't that sure about selling it, anyway.
Incidentally, this also makes an interesting addition to the discussion of online art sales. From the Phillips website, it's unlikely anyone could tell the difference between these two JPEGs — it would only become apparent that the process was different through carefully inspecting the prints in person. Collectors that are interested in this level of detail are, and should be, wary of buying work online. Texture is almost impossible to convey virtually. But that is really a different discussion for a different day.
UPDATE from the author: I've gotten a lot of pushback on Twitter for this particular theory about the Hirst print being overvalued. It's been great! I responded, with data to back up my argument, on the Market Watch blog.