Quietly leading the way

The above two objects are rare specimens of Gandhara art presented by China Guardian at their last auctions in May, bringing Buddha sculptures from 1st and 2nd century to Hong Kong. Provided to China Daily

Cui Ruzhuo's landscapes have consistently commanded the highest prices at Hong Kong auctions. Poly Auction Hong Kong sold Rain in the Autumn for HK$142 million in this spring. Provided to China Daily

Mainland auction houses have performed remarkably well in the face of tough competition from major international brands in HK, although they arrived in the city only over the last 20 years or less. Chitralekha Basu reports.

Increasingly buyers from the Chinese mainland are on the radar of art dealers the world over. This is probably most apparent in Hong Kong which acts as a vital conduit between the mainland and the rest of the world. As Gary Yee, CEO of Hong Kong-based art consultancy firm Art Serindia Ltd, says, all auction houses - including big-time international players and the homegrown Chinese brands - are competing for the attention of mainland buyers at this moment.

While collectors from Europe and the US seem to be on the back foot, those from the Chinese mainland are vigorously buying. As figures from independent research by The European Fine Art Foundation show, in 2016 buyers from Asia beat the more-seasoned client bases in Europe and the Americas to claim 40.5 percent of auction house sales from around the world and 90 percent of them were from China. China today is home to an ever-widening pool of collectors at the center of the world's art trade.

Hong Kong is often the first port of call of buyers from the Chinese mainland and, not entirely coincidentally, also the last. They come here to check out some of the world's most priceless paintings that later go on sale in London or New York. They comprise the bulk of consumers who buy from the major auctions and art fairs in the city. That Hong Kong doesn't count art as a dutiable commodity and has one of the world's most advanced logistics facilities in place make the city a great transit home for the stuff the connoisseurs pick up from the city.

Unsurprisingly, a substantial chunk of the world's art purchases in recent years is linked to Hong Kong. What might come as a bit of a surprise though is that the stars of record-breaking sales here have often been overshadowed by the hype over the runner-up. While Zhang Daqian's ink and color painting Peach Blossom Spring made headlines when it earned $34.7 million at Sotheby's spring auctions in April 2016, the sale of Cui Ruzhuo's The Grand Snowing Mountains for more than $39.5 million - which is also the highest a painting ever sold for in the local market - only a day before at Poly Auction Hong Kong went relatively unnoticed.

Poly Auction Hong Kong, a subsidiary of Beijing Poly International Auction, has been on a winning spree since it set up shop in the city in 2012. In fact, six out of 10 of the most expensive painting purchases in this city were through Poly. The market survey and analysis portal Artprice reveals that seven out of 10 of the most expensive art pieces sold in Hong Kong last year were placed in the market by mainland auction houses, including Poly. Their success seems sweeter when one considers mainland auction houses now making a splash in the Hong Kong market arrived in the city less than 10 years ago, whereas the multinational heavyweights have been around for much longer (Sotheby's hosted their first Hong Kong sale in 1973) and been in business elsewhere since the 18th century.

On a firm footing

At a time when the performances by international heavyweights of the auction industry - Christie's, Sotheby's and Bonhams - do not seem to create much of an upheaval in the local market, Poly Auction Hong Kong made HK$1.245 billion at the last spring auction, a 17-percent growth since their last outing. Their highlight piece in spring 2016, Wu Guanzhong's landscape, The Zhou Village, which masterfully combines both Chinese and modern European sensibilities, was sold for HK$236 million.

Wu Guanzhong landscapes ruled the Chinese auctions in Hong Kong again this year. China Guardian, another auction house with roots in the Chinese mainland now active in the city, sold one for HK$23 million. Their total haul at the end of the 2017 spring auctions was an impressive HK$326 million.

Poly and China Guardian are in the forefront of mainland auction houses that have found a firm footing in the already crowded Hong Kong art market within a short time. Other names in reckoning include Hanhai Auction, Council (Kuangshi), ChengXuan Auctions, HuaChen Auctions, Sungari International Auction, etc. Gary Yee, who founded a local auction house some years back but has since moved on to run a consultancy that helps auction houses develop marketing strategies, says more "medium-sized" auction houses from the mainland and Hong Kong keep opening in the city and for all of them to coexist in a small space, it is necessary to develop niche interests, and encourage clients to look beyond the familiar fare.

"I introduced Song Dynasty (960-1279) ceramics as a specialized category to the Hong Kong market in 2013," says Yee. "Now we are working with different auction houses to introduce Chinese archaic bronzes and ancient Silk Road art."

Silk Road seems to be the new buzz word in Hong Kong's auction scene, inspired, it might be assumed, at least in part, by the President Xi Jinping's call to revive the ancient trade route connecting China all the way to Central Asia and Europe around the Mediterranean Sea. Nicholas Wilson, who heads the Chinese Ceramics and Works of Art Department at China Guardian Hong Kong, mentions his company hosted a symposium earlier in 2017 "with the idea of promoting art that passed through the ancient Silk Road".

Among the merchandize that could have travelled down that road were the Gandhara-style Buddha sculptures with Greco-Roman features that flourished in the 1st and 2nd century in regions that are now in Pakistan and Afghanistan. At China Guardian's spring sales in late May, Wilson sourced a few rather rare specimens of Gandhara art, including a 2nd century panel carved in black schist, showing the death and funeral of the Buddha.

"Getting younger buyers on board has been a bit of a challenge," said Wilson. "But we've been trying to address that, educate newer buyers, show them that these pieces can be quite worthwhile even in a contemporary setting, that they are really interesting historical pieces."

Sustained relationships

Mainland auction houses do not seem unduly anxious about whether or not they are noticed by the media as they follow a business model that's different from the Western auction houses. Much of their sales are achieved largely on the basis of building a relationship of confidence and trust with the client, sustained over years.

Apart from having good guanxi, or relationship with patrons it helps to cater to an audience that is not necessarily looking to buy big-ticket pieces. "Whereas Christie's and Sotheby's are more focused on just selling the top end of the market, we encourage all kinds of objects to be sold through us," says Wilson.

Although the leading mainland auction houses like China Guardian and Poly now have bases in different parts of the world, they deal primarily in Chinese art, catering mostly to a Chinese audience.

"Typically, our clients are mainland Chinese with domiciles in other places. They buy with the money they earned abroad and keep the pieces outside of the mainland. And Hong Kong of course is a great place to store art. There's no tax to pay and it's easy to transport the pieces from here," says Wilson, referring to the city's obvious advantage in being the world's biggest container port.

Alex Chang, managing director of Poly Auction Hong Kong, too attributes the stellar rise of his company's profile in Hong Kong to the city's strategic location and general openness. Doing business in the city helps him stay connected with his network of buyers in "Taiwan, Southeast Asia, Japan and South Korea as well as a growing number of collectors from Europe and the United States". The city's "inclusive culture", Chang points out, is conducive to "healthy interactions between art galleries, art fairs and auction houses which will further expand the market".

The exposure to this confluence of art and ideas from around the world has inspired mainland auction houses to broaden their range. Chang says Poly has been offering "artists from Japan, South Korea and Southeast Asia, in which more and more Chinese and Asian collectors are showing interest". Wilson of China Guardian has plans to introduce mid-20th century Scandinavian furniture created by the Danish designer Hans Wegner who "did a couple of chairs based on Chinese design".

Broadening horizons

As more mainland auction houses pop up against the Hong Kong skyline, dipping into a common pool of buyers, one wonders if there's enough in terms of art and capital to sustain the current spate of energetic buying and selling in the long run.

"If there is anywhere in the world where there is a volume of collectors with the capacity to absorb a lot of art, I certainly think Hong Kong is one of those," says Edward Wilkinson, executive director of Bonhams Asia, "because you got two massive populations, Chinese and Indian, sitting on Hong Kong's doorstep, not to mention the rest of Southeast Asia."

He believes Hong Kong today is an evolved marketplace.

"Today the community of buyers is far more informed than to go for something just because the words Qing or Ming was being mentioned," says Wilkinson.

"The presence of Chinese mainland auction houses in Hong Kong is a very positive thing for the market because it certainly gives a clear indication that Hong Kong is a preferred city to conduct transactions in terms of the legal apparatus that's in place, the (prevailing) rule of law and people having a feeling of safety and satisfaction," he adds.

Like Chang of Poly and Wilson of China Guardian, Wilkinson too thinks the way forward for auction houses doing business in the SAR is to look beyond art from Chinese mainland.

"I am interested in seeing greater representation from say the Indian subcontinent, or antiquities from Southeast Asia, all of which are barely represented here. For me that's an interesting space that has potential."

Contact the writer at basu@chinadailyhk.com

(HK Edition 07/04/2017 page8)