Christie's Increases Buyers' Commissions as Auction Sales Rise
Date: 30 Jan 2007 | | Views: 4654
Christie's International, the world's biggest art seller, will increase the commission that buyers pay for big-ticket art, following a move by rival Sotheby's on Jan. 12.
Starting on Feb. 5 during a round of London sales, buyers at Christie's will pay 20 percent on the first 250,000 pounds ($500,000) of the hammer price and 12 percent on the rest, the London-based auction house said in an e-mailed statement. Currently, Christie's charges 20 percent on the first 100,000 pounds and 12 percent on the rest.
The move "is to ensure that we remain competitive,'' Chief Executive Officer Edward J. Dolman said in the e-mail.
The commission increase could significantly boost the auction houses' revenue and profit. At Sotheby's, the increase could add as much as $50 million in revenue and 50 cents a share in earnings in a year, analyst Kristine Koerber of JMP Securities in San Francisco said. Christie's, owned by the French billionaire Francois Pinault, doesn't disclose revenue or profit, only auction totals.
Sotheby's and Christie's are benefiting from a tide of wealth that has entered the art market from the U.S. to Russia and Asia. Contemporary prices rose 24 percent last year and have quadrupled since 1996, according to Art Market Research's Contemporary Art 100 Index of expensive works by artists such as Richard Prince, Damien Hirst and Marlene Dumas.
Christie's sold 2.5 billion pounds of art last year, a 36 percent increase from 2005, including the lion's share of expensive paintings by Gustav Klimt and other artists.
By Linda Sandler, bloomberg