Will the Warhol Foundation Sale Affect the Artist’s Market? Probably Not

(Courtesy Getty Images)

Yesterday it was announced that the Warhol Foundation will, through Christie’s, sell its entire collection of works by the artist, which features some 350 paintings and thousands of prints, drawings and photographs, together estimated to be worth some $100 million. Both The New York Times and The Wall Street Journal, quoting dealer Alberto Mugrabi, gestured at the idea that the sale might mean bad news for those who deal in Warhol. The Journal story said in the second sentence that the foundation was “about to upend the Warhol market.”

It’s possible, but unlikely. While $100 million is nothing to sneeze at, a major Warhol dealer told us that the private market for Warhol last year was “comfortably over half a billion dollars,” which, when combined with the $346 million the artist brought in at auction last year, describes an annual market that’s closer to $1 billion, making that $100 million closer to just 10 percent of the annual market. Moreover, the most expensive piece Christie’s will sell has a high estimate of $1.5 million, whereas, on the subject of $100 million, Philippe Ségalot sold Eight Elvises (1963) for just that price in 2008. It’s not insignificant that a single Warhol work can sell for the entire price of the Warhol collection—it implies that such high-end deals are a regular part of the Warhol market. And, of course, the Eight Elvises price point serves to drive home the fact that the Warhol Foundation is offering works of a different quality than most works that trade hands in the Warhol business.

“It makes no sense,” said the major Warhol dealer, of the implication that the foundation sale might affect the market. “It’s like saying if there was a big sale of Picasso lithographs, the value of Les Demoiselles D’Avignon would be affected.”

It’s important to keep in mind that, as Sarah Thornton wrote for The Economist in 2011, the actual Warhol market is controlled by a small handful of people:

“Sixteen Jackies” sold at the low end of its estimate for $20m to an anonymous phone bidder. However, Mr Mugrabi, said to have a huge inventory of Jackie paintings, was the direct underbidder. Mr Mugrabi and his sons also underbid two other Warhols at Sotheby’s and bought two Warhol paintings at Christie’s, including a red version of his 1986 self-portrait, known as a “fright wig”, for $27.5m. In any given contemporary auction week, a fair number of the Warhols will have been either consigned, underbid or bought by the Mugrabi family, sometimes in partnership with Larry Gagosian (who sits across the narrow aisle from Mr Mugrabi at Christie’s and one row ahead of him at Sotheby’s).

What would the Warhol market look like without the handful of players that give it that extra umpf—or at least make sure certain lots don’t fail to sell?… As a gallerist, Mr Gagosian occupies a slightly different place than the other Warhol aficionados. During this past week, 52% of all lots in Christie’s evening sale consisted of artists exhibited by Gagosian Gallery. At Sotheby’s this number was exactly half, whereas at Phillips the overlap with Gagosian was 46%.

There’s even reason to think that the sale might help the market, our dealer said.

“It probably will generate more interest in Warhol,” he added, “which is probably good for the market in the long run because it will keep the spotlight on Warhol, it will keep Warhol in the public’s eye.” That’s something to keep in mind for future coverage of the sale.

Will the Warhol Foundation Sale Affect the Artist’s Market? Probably Not