After the Klimt Auction

On November 18, Sotheby’s rolled out the blue carpet, hung the velvet ropes, and poured Champagne for attendees on the inaugural night of auctions at the Breuer Building, its new headquarters on Madison Avenue. The collection of the late cosmetics billionaire Leonard A. Lauder was on the block, and the house desperately needed a strong showing. The global art market has endured a grim two years of sliding sales and gallery closures, but Sotheby’s has been in a more precarious position than most.

The Breuer, which Sotheby’s bought from the Whitney for an estimated $100 million in 2023, was a splurge, considering the company’s consolidated global sales fell 23 percent in 2024. Adding to the pressure are the debt issues of owner Patrick Drahi, whose company Altice has faced multiple corruption probes. The success of the sale hinged on three Gustav Klimts, including Portrait of Elisabeth Lederer, a six-foot-tall painting of a pale, wide-eyed heiress in a Chinese imperial robe, estimated at $150 million.

“The entire week was fundamentally going to be based on ‘How did the Klimts do?’” says the art adviser Todd Levin. “If those three paintings tanked, both from a financial perspective and from an optics perspective, it would have been catastrophic.”

From inside her frame, Elisabeth Lederer towered above the head of auctioneer Oliver Barker, who kicked off the paddle raise. As he notched million-dollar increments, the crowd began to whisper. When he reached $200 million, it broke into applause. Being sold off to the highest bidder started to make Lederer look even more fragile. Were her eyes always so sad? Was she even 18? Whatever meaning Klimt poured into this figure during some erotic blaze of inspiration was no match for this display of capital in full plumage. Collectors long ago replaced curators and critics as arbiters of artistic value, and more people today will hear about the Klimt price than will ever see a Klimt in real life. For many plutocrats now, art occupies a curious place. Millions of dollars mean nothing, while the art itself offers little more satisfaction than its price in millions.

After 19 minutes, Barker’s tiny hammer came down and Lederer sold for $236 million (including fees), the highest price ever paid for a work of modern art at auction. The audience roared. Sotheby’s got the triumphant headlines it wanted, and so too did the auctioneers, dealers, and advisers hoping the prices would instill new confidence in the market.

Perhaps a correction was in order following the $450 million sale of Salvator Mundi, the badly restored, probably partial Leonardo painting, in 2017. And yet the industry has been anxious. After a pandemic slump, prices peaked in 2022, when global art sales reached $67.8 billion thanks again to two extraordinary single-owner auctions (Microsoft co-founder Paul Allen’s $1.6 billion collection and the $922 million fruits of Harry and Linda Macklowe’s rancorous divorce). Then there was a steady decline each year, ultimately bottoming out at $57.5 billion in 2024, according to the Art Basel and UBS Art Market Report. Deep-pocketed Asian buyers pulled back, while tariffs slowed global trade.

The downturn has been conspicuous in the primary market, too. In the past two years, small and midsize galleries, including Clearing, Blum, Deli Gallery, and JTT, announced plans to shutter. In light of their plight, the sale of the Klimt appears less like a comeback than a confirmation that the market may only be working for the top .01 percent.

For auction houses, the recent deaths of some of the biggest collectors of modern and Impressionist art presented an opportunity for a turnaround. There was Cindy Pritzker, who with her husband, the Chicago billionaire Jay Pritzker, amassed a cache of art that included a $63 million Van Gogh painting of books. There was also the previously unknown collection of blue-chip modern works from the Pennsylvania supermarket tycoons Patricia Ross Weis and Robert Weis, including a Rothko that would sell for $62 million. And an anonymous consignor offered up an extraordinary trove of Surrealist art, including a $54.7 million Kahlo self-portrait. The auction-house duopoly competed fiercely to score the commissions.

The market used to “skew toward Christie’s,” says Allan Schwartzman, an art adviser and former Sotheby’s chairman, because it was a private company and Sotheby’s was public until 2019, when Drahi acquired it for $3.7 billion. “There was the assumption that Christie’s was more driven by the desire for market share than the desire for profit, and Sotheby’s had to be accountable to its shareholders. Now that both companies are private, that’s changed.”

To woo top sellers, auction houses compete with marketing promises, offering guaranteed minimum sale prices and lowering their own fees, which can lead to narrow profit margins and risky gambles on works that may not sell. Sotheby’s would not disclose the terms of its deals with the various consignors, but, according to art advisor Megan Fox Kelly, it had to involve “putting a lot on the line.”

“Christie’s and Sotheby’s are just fighting tooth and nail. It’s like this ongoing back-alley brawl to see who is going to assume dominance in this field,” says Tim Schneider, author of the industry newsletter The Gray Market. In the end, the winner “just comes down to whoever puts a bigger number in front of the potential consignor or the executor of the estate.”

Another reminder of the week’s marriage of art and wealth was seeing the old Whitney Museum galleries turned into auction rooms. But buying the Breuer turned out to be a valuable projection of strength for Sotheby’s and a bargaining chip over its rivals.

“There were people who said, ‘Maybe it won’t be done on time,’ or ‘Maybe it won’t be as great as everyone said it was,’” says Lisa Dennison, Sotheby’s chairman of North and South America. “The truth of the matter is it was done on time, and it has exceeded people’s expectations. It really elevated the art.” (The public exhibition of the works would draw 25,000 visitors in just over a week, surpassing the 5,500 who came during the spring sales at its old building on York Avenue.) Sotheby’s landed the Lauder and Pritzker collections, as well as the Surrealist consignments — Christie’s won the Weis estate, which would total $218 million, easily surpassing its $180 million estimate — but there were other headaches to overcome.

A week before the auction, Alexandre Bronstein, an heir to a historic French family of art collectors, threatened to sue Sotheby’s if it didn’t withdraw an 1899 Félix Vallotton painting, estimated between $1.5 million and $2.5 million, from the Pritzker sale. He claimed that Wildenstein & Co., which has been repeatedly raided and sued over allegedly stolen art, fraudulently diverted “Woman lying down (Sleeping)” from the estate of his great-great-aunt Julie Goujon-Reinach before it was sold to Pritzker. (Lauder had also faced a restitution claim over the Lederer portrait years earlier, but his family members settled with the heirs.) Sotheby’s was not persuaded, and the sale went ahead as planned.

“We have conducted our full and customary due-diligence, including a thorough review and verification of the work’s provenance,” a representative said. “This included confirming the identity of the consignors to Wildenstein. We are fully satisfied that there are no restitution issues or outstanding claims associated with this work.”

When the painting of the sleeping woman appeared on Thursday, the final night of the week’s sales, a flurry of hands flew in the air, and the work sold above estimate for $2.8 million. The next day the houses added up their totals: Sotheby’s brought in $1.2 billion, followed by Christie’s with $965 million and Phillips with $67.3 million. Although it was a jubilant week, the final tally was still 30 percent below the $3.2 billion haul of 2022.

Does one week of banner headlines mean things have turned around for auction trade? Not exactly. The likelihood of collections of this caliber appearing again in a single year is slim. “When are you going to have a chance to get a Klimt like that portrait?” said Kelly. “If you look at how many are in private hands, that was your last chance to get something of that quality and of that size. That’s it. Everything else is locked up.”

Auction houses are well aware that the recent evening sales were the result of a rare confluence of factors, and such records may not return for a while. “There are four major estates, and that has nothing to do with the market. That’s just the way life happened,” Levin says. In the meantime, Sotheby’s, in particular, has been pivoting to luxury with a growing number of sales featuring Birkin bags, watches, sneakers, and even dinosaur bones.

There was one high-priced work last week that will not be shipped off to some freeport, sheikh’s yacht, or mysterious “private collection.” On the same night as the Lauder sale, Sotheby’s auctioned Maurizio Cattelan’s 18-karat solid-gold toilet, titled “America.” The fully flushable sculpture, which Cattelan has described as “1 percent art for the 99 percent,” was installed at the Guggenheim during the first Trump administration. When, in 2017, the White House asked the museum to loan it a Van Gogh painting, the curator declined and instead offered the toilet. Trump didn’t take her up on the offer.

But eight years later, Sotheby’s secured a buyer that will in fact bring the work to the 99 percent. Ripley’s Believe It or Not! — the American franchise for amusements such as an oddities museum in the Wisconsin Dells — bought it for $12.1 million. Now here was art with real value, Ripley’s said: “Melt it down and the gold alone would fetch about $10 million at today’s rate.”