Speculators win by betting on young artists

LONDON – Three years ago, her large paintings sold for around $40,000 each at a little-known gallery. In 2021, one of them was resold at a Sotheby’s auction for a record $3.1 million. Another hangs in the home of British Treasury Secretary Rishi Sunak on Downing Street.

Flora Yukhnovich, 31, a British painter whose first solo exhibition opens at London’s Victoria Miro Gallery on Tuesday, is one of the most sought-after young rising stars in the art world, and her works have met with insatiable demand from collectors and speculators internationally.

“The number of very interested, serious collectors who have inquired about the work is in the hundreds,” said Matt Carey-Williams, Victoria Miro’s director of sales.

The heat in the market for Yukhnovich’s exuberant semi-abstract paintings is symptomatic of the phenomenon known as “flipping.” When demand for a particular artist significantly outstrips supply, those who have acquired their work through galleries can reap huge profits by offering them at auction. Galleries are keen to avoid this: a seething resale market can make it difficult for artists to sustain a long-term career.

“Auction results do not affect the pricing strategy for Flora’s work,” said Carey-Williams. Yukhnovich, who declined to be interviewed for this article, has a distinctive painting style that dematerializes figure-heavy Old Master motifs into swirling smudges of color. Her latest work on the Victoria Miro show ranges from $135,000 to $470,000 (£100,000 to £350,000), reflecting how the artist’s gallery prices “have slowly and cautiously increased over the past 18 months,” according to Carey-Williams.

Yukhnovich’s auction prices, on the other hand, have risen into another sphere, which only encourages more potential buyers to join the line.

The commitment to young contemporary art has never been higher.

In 2014, works by artists under 40 fetched $181 million at auction. Last year they made a record $450 million in sales, a 275 percent increase from 2020, according to Artprice, a France-based company that tracks international auction sales. Eyebrows have been raised during this earlier market frothing than paintings turned over by the likes of Smith, Jacob Kassay, and Oscar Murillo to fetch more than $300,000 at auction. Recent showroom prices for Yukhnovich, Matthew Wong and Avery Singer added an extra digit.

“The market has grown since 2014,” said Wendy Cromwell, a New York-based art consultant. “There are a lot more people and a lot of money in the system. There are few artists who compete and that leads to exponentially higher prices.”

Cromwell said buyers of high-quality contemporary art are also getting younger. A new wave of participants in their 40s, 30s and even 20s, enriched by inheritance and the tech economy, is changing the market, she added. “There was this youth tremor in terms of who is buying the work and who is distributing it,” she said.

According to Sotheby’s year-end statement, “an influx of younger, more tech-savvy collectors” helped the auction house achieve a record $7.3 billion in sales in 2021, with the number of bidders under 40 rising by 187 percent.

Given the market’s emphasis on youth and technology, it’s no surprise that Instagram was the primary reason for interest in Yukhnovich’s work, as is the case with so many artists today.

“I came across Flora on Instagram, and I was definitely not alone,” said Matt Watkins, a director of the Parafin Gallery in London, which hosted a landmark solo exhibition of Yukhnovich’s paintings in 2019. Influencers like Carey-Williams and the young art historian Katy Hessel, whose thegreatwomenartists account has 250,000 followers, was among the key early enthusiasts, as was the ArtForum Instagram account, which has 1.2 million followers.

“It gave her tremendous visibility. Instagram was the most important thing,” said Watkins.

Subsequent seven-figure auction prices have also brought Yukhnovich a lot of attention, as has the artist’s move to Gallery Victoria Miro, with its international client list and global art star roster.

Carey-Williams said Victoria Miro would only sell Yukhnovich’s works to “respectable collectors, where both the gallery and the artist are very confident that any acquisition will remain a long-term possession.”

The approach reflects the gallery’s tightly controlled representation of the highly respected Los Angeles-based artist Njideka Akunyili Crosby, which prioritizes sales to public museums to bolster Crosby’s critical reputation and exclude profiteers. For the past six years, Victoria Miro has placed Crosby’s work in the Metropolitan Museum of Art in New York; the National Gallery of Art in Washington; the Los Angeles County Museum of Art; tate and other institutions. According to Artprice, no major recent work by this coveted artist has been resold at auction since 2018.

“By restricting access to new work, the auction market is being wiped out. There’s no momentum,” said art advisor Cromwell, who added that many buyers who manage to acquire new work by sought-after artists are now required to sign agreements requiring them to offer the source gallery a first refusal if they so choose Selling.

As dealers in America and Europe are determined to confine sales of the most desirable young art to established collections, new buyers will have to look further afield.

Ghana in particular is now considered a hotspot for up-and-coming talent. Last year, works by one of the country’s most prominent young artists, Amoako Boafo, fetched no less than $3.4 million, while gallery prices fetched just $10,000.

“I’ve never seen anything like it,” said Victoria Cooke, director of Gallery 1957, a dealer in Ghana’s capital Accra that represents local artists and exhibits them internationally. “Even during the pandemic, there were collectors and gallery owners from Paris, the US and the UK. A lot of people try to go straight to the source,” she said, adding that the buyers are “a mix of collectors and speculators.”

“People can come in and buy up a studio here and flip the works,” Cooke said. “This could be an exciting opportunity if you don’t have someone you trust who will advise you otherwise.”

With only two major dealers in Accra (the other being contemporary art gallery ADA) who act as gatekeepers to Ghana’s talent, the budding artists have turned to an international auction house to reach a – hopefully – less sketchy clientele .

In January, Phillips hosted the 10-day Birds of a Feather sales exhibition at its London headquarters in its role as a private sales agent rather than a public auctioneer. Featuring 18 recent works by six little-known young Ghanaian artists, this rare venture by an auction house in the gallery-dominated ‘primary market’ was carried out in collaboration with Artemartis, an Accra-based artist collective. All of the works were sold for prices ranging from $4,000 to $12,200, according to Anna Chapman, a spokeswoman for Phillips, although she declined to release any further information about these private sales.

“There’s a lot of people coming to Ghana trying to collaborate with artists,” said Selasie Gomado, the founder of Artemartis, who serves as a dealer and manager for the collective. “We teach them the importance of contractual agreements so that they can have a long and sustainable career. An artist can get a lot of attention and get none of it at the end of the day.”

Buyers of these affordable works by young Ghanaian artists at Phillips may or may not intend to flip them. but Those lucky enough to have purchased Yukhnovich’s works at a similarly early stage in her career continue to benefit. A painting featured in the artist’s 2017 master’s exhibition will be auctioned at Christie’s on Tuesday for up to $470,000. The following day, a 2020 work is valued at $270,000 at Sotheby’s.

Like it or not, it’s this kind of betting on young talent, as well as art itself, that draws so many people into today’s art world.

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