Mission to Moscow

Long before “oligarch” became a familiar term in the art trade, sums realized for Russian art, including decorative objects, paintings and icons, represented just a tiny fraction of annual auction totals. Now, thanks largely to the expanding monied class that word denotes, the Russian-art market is one of the fastest growing, racking up higher sales totals with each successive season. Given the explosive rate of increase—the field has grown by a staggering 2,000 percent since the year 2000—it is no wonder that the auction houses are strategizing about how to serve the client base for these works to everyone’s best advantage.

Collectors in the former Soviet Union “don’t want to buy just one or two things. They want to buy 20 or 30,” says Mark Poltimore, chairman of Sotheby’s Russia. “Their passion [for collecting] comes through. They love to probe. You can’t just tell them, ‘Well, it’s a lovely picture’—they want to know why, in quite serious detail. Sometimes they come across as aggressive.” 

Back in February 1985, when Sotheby’s held its first sale devoted to Russian art, in London, it netted £883,498 ($998,800). The top lots were a Fabergé figure (£82,500; $93,000) and a seascape by Ivan Konstantinovich Aivazovsky from 1886 (£19,800; $22,400). Last November’s evening sale, also in London, raked in £26 million ($53 million), with 19 lots passing the million-dollar mark, including Natalia Goncharova’s Bluebells, a circa 1909 Matisse-inspired still life, which realized £3 million ($6 million). The tally bumped Sotheby’s year-end total for its three Russian sales—two in London and one in New York—to £89 million ($191 million). That figure would be approximately $75 million higher if the single-owner sale of the collection of the late cellist Mstislav Rostropovich had actually taken place in September. Instead, billionaire steel-and-media magnate Alisher Usmanov swooped in and bought the entire trove of 450 pieces for almost double the presale estimate.

Hefty figures like those from last fall’s sales suggest the motivation behind Sotheby’s recent foray into this region, which produced the artists bringing the prices as well as many of the buyers paying them. Last May the company opened an office in Moscow not far from the Kremlin. It also appointed Mikhail Kamensky, the well-connected former director and presidential adviser at the Bank of Moscow, as managing director. “There’s a lot of work and confidence building to be done,” Poltimore explains. “The Moscow office will allow us to look after clients and to find out who the major players are, which you can only do on the ground there.”

Although Christie’s has not yet announced any formal plans for a similar presence in the country, an office in Moscow or elsewhere in the area is almost certainly in the cards. “It is just a question of finding the right city for our clients,” says a knowledgeable source inside the company. “There are potential plans in place.” Meanwhile, the house’s week of Russian sales in London last November totaled £44.9 million ($92.5 million) and included a Rothschild Fabergé egg from 1902 that sold to a Russian collector, after a 10-minute bidding battle, for £9 million ($18.5 million)—a record for a Russian object at auction. Christie’s holds its next Russian sales on April 18 in New York and on June 11 in London. Another source says the house is “seriously considering” staging a stand-alone Russian contemporary-art sale in London sometime this year.

Immensely rich collectors from the former USSR “now have more time to spend on art,” says Alexis de Tiesenhausen, Christie’s international head of Russian art. But he also notes that the increased interest and investment in this area is the result of “a purely economic process.” In 2000, Christie’s posted £5.6 million ($9 million) in worldwide sales of Russian art; the figure had jumped to £24.3 million ($42 million) by 2005 and reached approximately £71 million ($146 million) in 2007—an increase of 88 percent over the 2006 total. “We have to keep in mind that 10 or 20 years ago, potential collectors were unable to participate in auctions for obvious political reasons,” says de Tiesenhausen, explaining that between the time when the Bolsheviks came to power, in 1917, and the breakup of the Soviet Union, in 1991, “you had no wealthy people, no oligarchs or free-enterprise attitude.” With the fall of Communism and the subsequent market reforms, Russian buyers gradually reappeared. Sales will not likely be held in Russia in the near future because of the prohibitive regulatory climate—various taxes and export restrictions—and the uncertain political situation, not to mention the continued success of sales in New York and, especially, London, which, with its concentration of Russian expats, has become the center for the trade in this field.