The market for Chinese contemporary art has developed at a feverish pace, becoming the single fastest-growing segment of the international art market. Since 2004, prices for works by Chinese contemporary artists have increased by 2,000 percent or more, with paintings that once sold for under $50,000 now bringing sums above $1 million. Nowhere has this boom been felt more appreciably than in China, where it has spawned massive gallery districts, 1,600 auction houses, and the first generation of Chinese contemporary-art collectors.
This craze for Chinese contemporary art has also given rise to a wave of criticism. There are charges that Chinese collectors are using mainland auction houses to boost prices and engage in widespread speculation, just as if they were trading in stocks or real estate. Western collectors are also being accused of speculation, by artists who say they buy works cheap and then sell them for ten times the original prices-and sometimes more.
Those who entered this market in the past three years found Chinese contemporary art to be a surefire bet as prices doubled with each sale. Sotheby’s first New York sale of Asian contemporary art, dominated by Chinese artists, brought a total of $13 million in March 2006; the same sale this past March garnered $23 million, and Sotheby’s Hong Kong sale of Chinese contemporary art in April totaled nearly $34 million. Christie’s Hong Kong has had sales of Asian contemporary art since 2004. Its 2005 sales total of $11 million was dwarfed by the $40.7 million total from a single evening sale in May of this year.
These figures, impressive as they are, do not begin to convey the astounding success at auction of a handful of Chinese artists: Zhang Xiaogang, Yue Minjun, Cai Guo-Qiang, Liu Xiaodong, and Liu Ye. The leader this year was Zeng Fanzhi, whose Mask Series No. 6 (1996) sold for $9.6 million, a record for Chinese contemporary art, at Christie’s Hong Kong in May.
Zhang Xiaogang, who paints large, morose faces reminiscent of family photographs taken during the Cultural Revolution, has seen his record rise from $76,000 in 2003, when his oil paintings first appeared at Christie’s Hong Kong, to $2.3 million in November 2006, to $6.1 million in April of this year.
Gunpowder drawings by Cai Guo-Qiang, who was recently given a retrospective at the Guggenheim Museum in New York, sold for well below $500,000 in 2006; a suite of 14 works brought $9.5 million last November.
According to the Art Price Index, Chinese artists took 35 of the top 100 prices for living contemporary artists at auction last year, rivaling Jeff Koons, Damien Hirst, and a host of Western artists.
“Everybody is looking to the East and to China, and the art market isn’t any different,” says Kevin Ching, CEO of Sotheby’s Asia. “Notwithstanding the subprime crisis in the U.S. or the fact that some of the other financial markets seem jittery, the overall business community still has great faith in China, bolstered by the Olympics and the World Expo in Shanghai in 2010.”
There are indications, however, that the international market for Chinese art is beginning to slow. At Sotheby’s Asian contemporary-art sale in March, 20 percent of the lots offered found no buyers, and even works by top record-setters such as Zhang Xiaogang barely made their low estimates. “The market is getting mature, so we can’t sell everything anymore,” says Xiaoming Zhang, Chinese contemporary-art specialist at Sotheby’s New York. “The collectors have become really smart and only concentrate on certain artists, certain periods, certain material.”
For their part, Western galleries are eagerly pursuing Chinese artists, many of whom were unknown just a few years ago. Zeng Fanzhi, for example, has been signed by Acquavella Galleries in New York, in a two-year deal that exceeds $20 million, according to a Beijing gallerist close to the negotiations; William Acquavella declined to comment. Zhang Xiaogang and Zhang Huan have joined PaceWildenstein, and Ai Weiwei and Liu Xiaodong showed with Mary Boone last spring. Almost every major New York gallery has recently signed on a Chinese artist: Yan Pei Ming at David Zwirner, Xu Zhen at James Cohan, Huang Yong Ping at Gladstone, Yang Fudong at Marian Goodman, Liu Ye at Sperone Westwater. Their works are entering private and public collections that until now have not shown any particular interest in Asian contemporary art.
“The market hasn’t behaved as I anticipated,” says New York dealer Max Protetch, who has been representing artists from China since 1996. “We all anticipated that the Chinese artists would go through the same critical process that happens with art anywhere else in the world. I assumed that some artists would fall by the wayside, which has not been true. They all have become elevated. It seems like an uncritical market.”
One of the key artists buoyed by this success is Zeng Fanzhi, who is best known for his “Mask” series. Five years ago his works sold for under $50,000. Today he commands prices on the primary market closer to $1 million, with major collectors Charles Saatchi and Jose Mugrabi among his fans. Now preparing for his first solo show at Acquavella in December, he is considered one of the more serious artists on the Beijing scene because he works alone, without the horde of assistants found in most other artists’ studios in China. Still, his lifestyle is typical of that of his equally successful peers. When asked if he owns a mammoth black Hummer parked outside his studio, he answers, “No, that’s an ugly car. I have a G5 Benz.”
This success has blossomed under the watchful eye of the Chinese government. Movies, television, and news organizations are strictly censored, but on the whole, the visual arts are not. Despite sporadic incidents of exhibitions being closed or customs officials seizing artworks, by and large the government has supported the growth of an art market and has not interfered with private activity. In the 798 gallery district in Beijing, a Bauhaus-style former munitions complex that has been transformed into the capital’s hottest art center, with more than 150 galleries, one finds works addressing poverty and other social problems, official corruption, and new sexual mores. The icons of the former China-happy workers and peasants and heroic soldiers raising the red banner-are treated with irony, if at all, by the artists whose works are on view in these galleries, which are private venues generally not under the strict control of the Ministry of Culture.
On the eve of the Olympics, however, the government asked one gallery to postpone an exhibition until after the games. Considered unsuitable was “Touch,” a show by Ma Baozhong at the Xin Beijing Gallery of 15 paintings depicting important moments in Chinese history, including one based on a photograph showing Mao Zedong with the Dalai Lama and the Panchen Lama in 1954.
The Beijing municipality spent enormous funds to renovate the 798 district before the Olympics, putting in new cobblestone streets and lining its main thoroughfare with cafés. Shanghai, which has benefited less from government support, now boasts at least 100 galleries. Local governments throughout the country are establishing SoHo-style gallery districts to boost tourism.
One person who seems confident about the future of the Chinese market is Arne Glimcher, founder and president of PaceWildenstein, who opened a branch of his gallery in Beijing in August. Located in a 22,000-square-foot cement space with soaring ceilings, redesigned at a cost of $20 million by architect Richard Gluckman, the gallery is in the center of the 798 district. “We are committed to the art, and we wanted to open a gallery where our artists are,” says Glimcher. Adding that he normally eschews the “McGallery” trend of setting up satellite spaces around the world, Glimcher insists that it was necessary to establish a branch in Beijing because there is “no local gallery of our caliber” with which Pace could partner. He has, however, recruited Leng Lin, founder of Beijing Commune, another gallery operating in 798, to be his director.
Another Western dealer who has taken the China plunge is Arthur Solway, who recently opened a branch of James Cohan in Shanghai. “I started coming to China five years ago, and I was fascinated by the energy,” says Solway, who wanted to introduce gallery artists like Bill Viola, Wim Wenders, and Roxy Paine to Asia but, like Glimcher, could not find a public museum or private gallery that he considered professionally qualified to handle such exhibitions. James Cohan Gallery Shanghai is located on the ground floor of a 1936 Art Deco structure in the French Concession, a particularly picturesque section of the city. The building was once occupied by the military, and red Chinese characters over the front door still exhort, “Let the spirit of Mao Zedong flourish for 10,000 years.”
“From 1966 to 1976, during the Cultural Revolution, people had nothing, but now there are spas in Shanghai and people drinking cappuccinos and buying Rolex watches-it’s an amazing phenomenon,” says Solway, who believes it is only a matter of time before these same newly affluent consumers begin to collect contemporary art.
Chinese collectors-or the hope that there will be Chinese collectors-are the key draw luring these galleries to Beijing. As recently as two years ago, few could name even a single Chinese collector of contemporary art. It was a truism that the Chinese preferred to spend their money acquiring antiquities and classical works. Since then several well-known mainland collectors have emerged on the scene.
Most visible is Guan Yi, the suave, well-dressed heir to a chemical-engineering fortune, who has assembled a museum-quality collection of more than 500 works. A major lender to the Huang Yong Ping retrospective organized by the Walker Art Center in Minneapolis in 2005, he regularly entertains museum trustees from all over the world, who make the pilgrimage to his warehouse on the outskirts of Beijing. Now he is building his own museum.
Another noted figure is Zhang Lan, head of the South Beauty chain of Szechuan-style restaurants throughout China; she also has assembled an enviable collection and displays pieces from it in her chic establishments. The film actress Zhang Ziyi is representative of a new class of collectors from the entertainment industry, while Pan Shiyi and Zhang Xin, chairman and CEO of the mammoth SOHO China real estate empire, have commissioned projects for their upscale residential properties.
Two collectors who are cheerleaders for the Beijing art scene are Yang Bin, an automobile-franchise mogul, and Zhang Rui, a telecommunications executive who is also the backer of Beijing Art Now Gallery, which took part in Art Basel in June, one of the first Beijing galleries to appear at the fair. These two do more than collect art. They have hosted dinners for potential collectors, organized tours to Art Basel Miami Beach, and brought friends with them to sales in London and New York. Zhang Rui, who owns more than 500 works, has lent art to international exhibitions, most notably the installation Tomorrow, which features four “dead Beatles” mannequins floating facedown, created by artists Sun Yuan and Peng Yu for the 2006 Liverpool Biennial, which rejected it.
Zhang is now building an art hotel, featuring specially commissioned works and artist-designed rooms, outside the Workers’ Stadium in the center of Beijing. “I am trying to think of ways of changing my private collection into a public collection,” Zhang explained to ARTnews through a translator. It isn’t financially advantageous to do this in China, as no tax benefits accrue from donations to museums or other nonprofit institutions.
Zhang Rui represents the handful of Chinese collectors who are public about their activities and are building noteworthy collections. Far more typical of buying activity in China is the rampant speculation taking place in the mainland auction houses. There are 1,600 registered auctioneers, and their sales attract hundreds of bidders. Chinese buyers are more comfortable with auction houses, which have been in business since 1994, than with galleries, which weren’t licensed to operate by the government until the late 1990s.
These auction houses run by their own rules, generating what sometimes seems like a “wild, wild East” atmosphere. It is, for example, fairly common for a house to get consignments directly from artists, who then use the sales to establish prices for their works on the primary market. More often, now that China has hundreds of galleries, dealers come to a sale with buyers in tow, publicly bidding up works to establish “record prices” and advertise their artists. This kind of bidding ring would be considered illegal in the United States, but in China it is viewed as a savvy business practice. There is little regulation of auction houses and few developed legal norms in the field, so that even when buyers have grievances-with fakes and forgeries, for example-they do not feel they can resort to the law. Bidding is a social as well as a business activity, and buyers are happy to flaunt their status by paying record prices or quickly flipping artworks, not only for profit but so they can boast of their short-term gains.
As the domestic market for contemporary art matures, however, many of these practices are coming into question. “Two years ago it was more necessary for me to bring my artists to auction,” says Fang Fang, owner of Star Gallery in Beijing, which specializes in young emerging artists such as Chen Ke and Gao Yu. “Now that the gallery market has increased, I find it is better to keep my artists out of the auction rooms, and there is much less reason to sell there.”
Two mainland firms, Beijing Poly International Auction Company, and China Guardian Auctions Company, dominate the field of contemporary Chinese art. Their combined 2007 total of more than $200 million in sales represented nearly two-thirds of all auction sales in this category in mainland China for the year. Last spring Guardian achieved $142 million in sales of classical artworks, furniture, ceramics, silver, and coins, and $40 million in sales of contemporary material. The latter figure included the $8.2 million fetched by Liu Xiaodong’s Hotbed No. 1, a record for a painting sold on the mainland. In a similar range of sales last spring, Poly sold $130 million worth of works, including $27 million in a single evening contemporary-art sale. (These figures represent a slight decline for the year because both houses held benefit sales for Szechuan earthquake victims, raising more than $20 million to support relief efforts.)
Poly and Guardian reflect two vastly different perspectives on the domestic market in Chinese contemporary art. Guardian is the oldest and most respected auction house in China, founded in 1993 by Wang Yannan, daughter of Zhao Ziyang, the former Communist Party leader who was placed under house arrest after opposing the government’s use of force against demonstrators at Tiananmen Square in 1989. If Poly is known for its vast resources and willingness to make deals to nab consignments, Guardian is known for its respected specialists and long-term client relationships. For example, when the Museum of Fine Arts, Boston, decided to sell 20 pieces of Qing dynasty porcelain in mainland China, it consigned the collection to Guardian.
The atmosphere of a sale at Poly or Guardian is surprisingly similar to that in the salerooms of Christie’s or Sotheby’s. The catalogues are identical in design, and the bidding proceeds in an orderly, even sedate, fashion, despite the crowds of spectators in the room.
“From our beginning, we studied what the principles of an auction house should be, and we stick to these principles,” says Guardian president Wang. She also serves on the board of the new nationwide auctioneers’ association, which hopes to enforce regulations on the auction market.
Poly is an enterprise within the China Poly Group Corporation, a $30 billion conglomerate that is the privatized branch of the People’s Liberation Army. Established initially to repatriate artworks and antiquities, Poly has spent $100 million buying objects such as the bronze animal heads from a water-clock fountain that were looted from Beijing’s Summer Palace by British and French troops in 1860; the pieces later turned up in the West. The repatriated objects are showcased in the Poly Art Museum in the sparkling New Beijing Poly Plaza, a glass-enclosed tower designed by Skidmore, Owings & Merrill.