Bidding up your own stock

August 15 2014

Image of Bidding up your own stock

Picture: Joseph Daniel Fiedler in Gallerist

There's an interesting article in Gallerist by daniel Grant on how many contemporary art dealers 'manage' auction prices on behalf of their artists:

When artists agree to be represented by a gallery, they usually work out with the gallery owner such matters as the amount of the dealer’s commission; how often their work will be exhibited in solo or group shows; the price of their artworks; that sort of thing. Another expectation, usually not as explicitly stated but increasingly crucial, is that the dealer will attempt to control the market for the artist’s work even after it has been sold. Some dealers go so far as to bid up, and even buy, pieces when artworks are consigned to auction. The practice is legal.

“I have bid up prices to appropriate levels, when auction houses have estimated too low works by artists whom I represent,” said Manhattan gallery owner Renato Danese. “I want to protect the work from going below the low estimate or not selling at all, because that puts a cloud over the work and over the artist.” Disappointing results at auction can potentially come back to haunt works sold at the gallery. “I don’t like to spend fruitless hours explaining why a good piece went for a quarter of the price I charge at the gallery.” He added that “artists expect me to protect their market and their reputations.”

Happily, Old Master dealers do not do this for, say, Gainsborough.

Update - a reader writes:

On bidding up, I remember a certain St James's dealer doing this in the 1990s, to protect the value of the Edwardian watercolour artist whose works he'd become closely invested in. So it's not only contemporary art.

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