The city’s top dealers have also developed its auction scene, fostering an unusual closeness with the auction houses that contrasts with the rivalry prevalent in Western capitals. To give contemporary art a higher profile in Seoul and to help the Korean art market recover after 1997’s financial crisis, Gana’s elder Lee founded Seoul Auction House in 1998.  “People weren’t able to sell their artworks because they couldn’t find anyone who wanted to buy,” he explains. “I thought the solution was to create an open market through the auction house, not so much for collectors as for dealers.” Last year, the house generated $104 million in sales. In 2005 one of its managers left to found a rival firm, K Auction, with funding from the family of Hyundai’s Myoung Ja Park; in 2007 K earned $67 million. The houses rack up these totals mainly through sales of modernist Korean painters like Park Sookeun, whose 1950 A Wash Place achieved a world record for a modern Korean work when it fetched $4.8 million at Seoul Auction in 2007. But they also handle the occasional major Western piece.

Despite such successes, the Korean art world has been shaken lately. This spring, Lee Kun-hee, the country’s top collector, was forced to resign from his position as the chairman of Samsung. Both for himself and for his company, Lee had assembled a massive trove of international blue-chip artists such as Francis Bacon, Hirst, Nam June Paik and Andy Warhol. Then this April he was charged with evading taxes by hiding billions of dollars in a slush fund and allegedly using some of that money to purchase $64 million worth of art for his personal use. Among the pieces cited in the allegation was Roy Lichtenstein’s painting Happy Tears, which was bought on behalf of Lee’s wife, Hong Ra-hee, at Christie’s in 2002 for $7.16 million. The scandal also forced Hong to resign from her position as director of the Leeum, Samsung Museum, Seoul’s only venue of international caliber. The affair cast a pall over the art scene for several months, and some big collectors were wary of making purchases while the investigation was under way. 

This mood was short-lived, however. Seoul Auction’s one-day sale in March made $15 million, causing waves of relief in the art world. “New collectors began to emerge,” reports Alice Lung, who does marketing for the house. “The press made sure that everyone knew about Lichtenstein’s Happy Tears, and this inadvertently led people to believe that art is an alternative investment.” For the city’s dealers and auctioneers alike, the next project is to get more than a handful of Korean artists onto the international art world’s radar—and to nurture them at home as well as abroad. In recent years, Seoul has produced its share of global stars, including video artist Kim Sooja, but they were mostly educated outside Korea and established their careers elsewhere.

To help promote his country’s cultural galaxy, Bong Lee opened the Gana annex in New York with a solo show of photographs by Bae Bien-U that featured haunting black-and-white shots of forests and followed this with an exhibition of Yong Ho Ji’s animals carved out of used tires. The idea was that both events would appeal to local buyers and give the artists an international cachet that would also burnish their reputations at home.

Perhaps ironically for a city whose charm derives in part from offering a slower pace than Beijing or Shanghai, Seoul’s market is largely being shaped by the soaring popularity of China’s artworks. “We are benefiting from the boom in Chinese contemporary art,” says Bong Lee, “because now that those prices have gone so high, people are avidly looking for Korean contemporary art.”

"On Solid Ground" originally appeared in the September 2008 issue of Art+Auction. For a complete list of articles from this issue available on ARTINFO, see Art+Auction's September 2008 Table of Contents.