by Don Thompson
The long-term goal is to transform the country from a hydrocarbon economy to one that is knowledge- and culture-based. The Sheikha oversees institutions that include Mathaf: Arab Museum of Modern Art, the first museum in the region to focus on contemporary and modern Arab art; the Museum of Islamic Art, designed by I.M. Pei; and the Jean Nouvel–designed National Museum of Qatar. The latter is the show-piece—it covers 1.4 million square feet.
The extensive collection of Western art being acquired will be shown in a new contemporary museum, probably situated in the Art Mill, a converted flour mill and grain silo on Doha Bay. When completed, the Art Mill is intended to have 995,000 square feet of exhibition space. By comparison, the Tate Modern’s most recent expansion resulted in that museum having 590,000 square feet.
The Sheikha has funded exhibitions to introduce Qataris to foreign art. She invited Chinese artist Cai Guo-Qiang, known for fireworks art, to exhibit. At the Sheikha’s insistence, Cai showed Arab-themed sculpture, with a taxidermal camel suspended in mid-air.
She has also exhibited Richard Serra, Takashi Murakami and Damien Hirst. She sponsored Murakami’s 2010 show at the Palace of Versailles and Hirst’s 2013 show at the Tate Modern, then transported each to Doha. Moving the Hirst exhibit from London to Doha was a logistical feat. The sculptures, vitrines and formaldehyde required for three Hirst shark pieces were flown from London to Doha in Qatar’s Emiri Air Force transport aircraft.
Jean-Paul Engelen, former director of public art programs at the QM, recounts a great cultural anecdote from the Hirst show in Doha: “A group from a religious boys school saw Hirst’s diamond-encrusted skull, ‘For the Love of God,’ and shouted ‘Allahu Akbar’ [God is great]. … They totally understood the message that we are all mortal.”104
Western museums acquire 90 to 95 percent of their art through gifts and bequests from collectors. All art for the new Qatari museums must be purchased. This is more challenging than it may seem. The Sheikha has spent record amounts on Andy Warhol and Damien Hirst. Justifying the acquisition of Islamic and Orientalist art would have been much easier.
Several sources, including Bloomberg, have reported the QM art acquisition budget at $1 billion a year. To put that in perspective, the Museum of Modern Art in New York has an annual acquisition budget of about $35 million—one-thirtieth that of the QM. The Metropolitan Museum has $40 million. The Centre Pompidou in Paris has $4 million. The only budget comparable to that of the QM would be that of the new Abu Dhabi Louvre and Guggenheim museums, although it is doubtful they have spent anywhere close to $1 billion in one year. The closest Western museum would be the Getty, but its (highly confidential) expenditure has probably only in a few years exceeded $100 million.
The impact of the Sheikha’s purchases on art prices—and on our perception of the value of modern art—is substantial. Paul Gauguin’s Nafea Faa Ipoipo (When Will You Marry?) (1892), a painting of two Tahitian girls, was purchased in 2014 in a private transaction for for a price reported at the time as $300 million, perhaps claimed at that amount because it would have been the highest price ever paid for a work of art (and four times the highest previous price for any Gauguin). It was later stated, in a June 2017 lawsuit where veteran art dealer and auctioneer Simon de Pury sued for a multi-million dollar commission, that the Gauguin masterpiece had actually sold for $210 million. Nafea is an important work, but not considered among the top ten Gauguin paintings.
Until the QM’S 2007 purchase of Mark Rothko’s White Center (Yellow, Pink and Lavender on Rose) (1950) for $72.8 million at Sotheby’s New York, the highest auction price for the artist was his Homage to Matisse in 2005 for $22 million—less than one-third the White Center price. In 2011, the QM spent $250 million for Paul Cézanne’s The Card Players (1893). That was four times the highest public price ever paid for a work by that artist.
The Sheikha purchased Damien Hirst’s The Golden Calf (2008) (see photo insert), a bull preserved in formaldehyde. It has eighteen-carat gold hooves and horns, a gold Egyptian solar disc on its head and outsized reproductive organs. The acquisition came for £10.3 million ($18.7 million) at Hirst’s single-artist sale at Sotheby’s London in 2008. The Sheikha and the QM have also acquired works by Bacon, Warhol and Lichtenstein.
There are fascinating backstories to some of the Sheikha and QM acquisitions; they illustrate the huge clout and determination of foreign collectors in the world contemporary art market.
The seller of the record-price Gauguin was Rudolf Staechelin, sixty-two, a retired Sotheby’s executive living in Basel, Switzerland. Through a family trust, Staechelin controlled an important collection of Impressionist and post-Impressionist works. The art was acquired after the First World War by his grandfather, a Swiss merchant also named Rudolf Staechelin. Nineteen works—the Gauguin plus works by Van Gogh, Picasso, Camille Pissarro and others—had been on loan to the Kunstmuseum Basel for fifty years. Staechelin told the newspaper Basler Zeitung that he was unhappy that the Kunstmuseum director would not commit to hanging the works in prime locations in the museum, or to displaying all the art all the time. Staechelin withdrew the works from the Kunstmuseum.
A Swiss dealer with knowledge of the dispute approached Qatar authorities and said that a “blockbuster offer” might induce Staechelin to sell the Gauguin or other paintings, and without any need to seek a competitive offer—notably not from the Abu Dhabi museums. The record-breaking figure resulted. Whether other works withdrawn from the Kunstmuseum were also offered to Qatar is not known. Staechelin was said to be negotiating with other museums to accept the remaining paintings on his terms. In the interim, sixteen of the works were offered on loan to the Phillips Collection in Washington.
In 2011 the art amassed by deceased Greek collector George Embiricos was offered for sale by his estate. The most notable work was Cézanne’s The Card Players. Four of Cézanne’s five card-player paintings are in the Met in New York, the Musée d’Orsay in Paris, the Courtauld Gallery in London and the Barnes Foundation in Philadelphia. In 2011, ArtNews magazine listed the Embiricos version of Card Players as one of the world’s top artworks still in private hands.
When it was known that Card Players might be available, art-world rumour had two dealers—Larry Gagosian and William Acquavella—each making unsolicited offers to the estate of between $220 and $230 million. The Qatar Museums Authority then offered $250 million, also with the condition that there would be no negotiating or seeking a counter-offer. Take it or leave it. The estate took it. The Cézanne may be the QM’S star acquisition to date. It is a major image, reproduced in every “Introduction to Art 101” text.
Qatar was also thought to be the new home of the Merkin Rothkos, following a $310-million, court-ordered sale in New York. J. Ezra Merkin had assembled what was considered the best private collection of Mark Rothko paintings in the world. Merkin was sued over his role as a provider of financing in the Bernie Madoff fraud saga, and needed to liquidate some of his collection. The story is that Russian collector Roman Abramovich opened bidding for the Rothkos with an offer in the high $200 millions (he later denied it). Qatar countered with $310 million, said by one dealer to be valid for a short time, perhaps only forty-eight hours. The Rothkos rank a strong second to the Cézanne in star power. The acquisition of the Merkin collection was one of the most impressive art-buying coups of the decade.
Several dealers told me that QM purchases included Andy Warhol’s Men in Her Life (1962), a 61/2-foot-tall (2-metre) silkscreen highlighted with pencil, of photos from a Life magazine feature on actress Elizabeth Taylor. The canvas has thirty-eight blurred images in seven rows. There is Taylor at the Epsom Derby with Mike Todd, her third husband, to her left, and Eddie Fisher, soon to be husband number four, on her right. Beside Fisher is his then wife, actress Debbie Reynolds. The silkscreen has little visual impact; it’s hard to make out the images from more than three feet away.
Men in Her Life was hammered down at Phillips New York in November 2010 for $63.4 million, at tha
t time the second most expensive Warhol ever at auction. The backstory of Taylor, Fisher, Reynolds and Warhol attracted a lot of attention from Western media. It is doubtful whether many Qataris would understand or appreciate it. In retrospect this may be the least impressive of the QM’S contemporary acquisitions.
There are other examples of Qatari art-buying. In 2009, the QM purchased William Hoare’s 1733 Portrait of Ayuba Suleiman Diallo (also known as Job ben Solomon) for £540,000 ($890,000) at Christie’s London. Ayuba is the first known English portrait of a freed Black African Muslim slave. The UK government turned down an application from Qatar for an export licence. The expectation was then that the National Portrait Gallery would try to raise matching funds to retain the portrait.
Normally when an export licence is declined the art buyer defers to the licence authority and allows a British museum to purchase the work. In this case the QM withdrew its application. That meant there was a compulsory year-long waiting period before a reapplication could be considered. The QM agreed that the portrait would go on an extended UK museum tour, then for a five-year loan to the National Portrait Gallery. It was assumed this was done in return for the portrait gallery’s agreement not to oppose the QM when it filed a future export application.
Commentators express dismay that these and other acquisitions result in ownership of cultural treasures determined by the vagaries of international wealth distribution. That may be true, but that is how the art world functions. Power at the national or international level is simply the ability and willingness to bid until all others drop out.
Sheikha al-Mayassa is the fourteenth child in her royal family. She holds a 2005 BA in political science and literature from Duke University. During her junior year she did an overseas semester at the Sorbonne. Both she and her husband, Sheikh Jassim bin Abdul Aziz al-Thani, did postgraduate work at Columbia University before returning to Qatar. She has no formal training in art or art history, but those who know her describe her as self-educated and very knowledgeable.
In a 2012 interview with the New York Times, the Sheikha said she hopes that Qatar’s new art institutions will help change both Western conceptions about Muslim societies and Islam’s perception of the West. She said she hopes to “nudge” (her term) the more conservative elements of Qatari society toward the modern artistic world. “It is a good thing to celebrate Western art in this region. You have to accept, appreciate and yes, learn from different cultures.”105
The artistic limits of what the QM will show are not always what a Westerner might expect. In 2013 the Sheikha mounted an exhibit outside a new medical facility in Doha. Titled The Miraculous Journey, it consisted of fourteen Damien Hirst bronze sculptures of the gestation of a human fetus, beginning with a sperm fertilizing an egg and progressing to a 46-foot-tall (14-metre) anatomically correct baby boy.
One artistic red line would be expected to be female nudity, almost never seen in exhibits in the Middle East. The Sheikha has said that there would be no restrictions on works displayed in Doha, even on nudes. She has had to backtrack at least once. Statues of nudes from Greek antiquity that were to be shown in the city were returned to Athens after QM officials refused to display them. Jean-Paul Engelen says he dislikes this story. “This is a different, family-oriented culture; to put a message across, it’s better to include people than to exclude them.”106
Two of the Sheikha’s competitors for art acquisitions are the proposed new museums on Saadiyat Island in Abu Dhabi. These are a Guggenheim Abu Dhabi, designed by Frank Gehry, and a Louvre Abu Dhabi, designed by [Norman] Foster + Partners. As of 2016, construction of the Guggenheim had been suspended for three years but was expected to restart. These museums challenge Qatar for art acquisitions because each emirate believes there is room for only one branded “destination museum” in that part of the world.
The Abu Dhabi acquisition process has become what the government refers to as “measured,” which means slow. Earlier in the acquisition process, a museum official made a purchase decision that the Sheikh challenged as overpriced and irresponsible. There is now a vetting stage by an acquisitions committee comprised of foreign curators and representatives of the Abu Dhabi government. This is a sufficiently long process that several dealers say they have sold work elsewhere rather than wait months for a committee decision.
The Qatar decision process can be very fast. Qatar has acquired works that were only to be offered to Abu Dhabi if Qatar rejected them— and in at least one case were first requested by Abu Dhabi, with the purchase decision stalling. Abu Dhabi is instead acquiring art through loan, most recently in 2015 by renting five hundred objects from the British Museum for a five-year period, in return for an undisclosed fee. What the Sheikha is attempting is uncommon in another way. New museums are built on the foundation of a community of artists, collectors, curators and commercial galleries. Qatar is building in reverse. There are few artists, experienced curators, contemporary dealers or collectors. The museums are coming first, and will take longer to achieve full acceptance. In 2014, Qatar’s Mathaf averaged 1,450 visitors a month, less than 100 a day. Half those visitors were foreigners.
The long-term impact of the Sheikha’s collecting on contemporary art prices also creates concern. When Qatar and its cousin museums in Abu Dhabi complete their purchasing programs, many works that come up for auction with high reserve prices may go unsold. Or the Sheikha’s collecting tastes may change, or she might have a successor who decides to pursue only Middle Eastern art. Would any of these be sufficient to seriously deflate the art price bubble?
Early 2015 brought elevated speed bumps on this bridge between East and West. There were renewed allegations about the way that Qatar won the right to hold the 2022 World Cup football competition. More painful were allegations that the country’s football stadiums were being built by third-world migrant workers.
The issue was the events, but more importantly how the Western press would cover them. The opinion of most art-world officials seemed to be that international criticism ignored the subtleties of power in the region and the cause of moderate Islam. The argument continued that conservatives and others who opposed globalization gained ground each time international organizations and news media put pressure on the government.
If highly critical media stories continue, it is unclear how many Western tourists might in the near future want to visit the emirate to see the new museums, even with the lure of Cézanne, Rothko, Hirst and Warhol.
THE BUBBLE
CHAPTER TWENTY-TWO
GAMING THE ART BUBBLE
“The price of a work of art is an index of pure, irrational desire.”
—Robert Hughes, art critic107
“I’m really not optimistic [that individuals can debias themselves].”
—Daniel Kahneman, behavioural economist and Nobel laureate108
BALLOON DOG (ORANGE), APOCALYPSE NOW, POPEYE, THE EXPANSION OF freeports—these and other indicators all point to the contemporary art market as a looming price bubble. That outcome is, in my view, a certainty. The main explanation for the huge sums of money changing hands is wishful speculation, both for iconic works of art and for work by emerging artists. Economics students learn that all things are cyclical and that speculation-driven cycles are wilder. No luxury good (or commodity) can increase in value at many times the annual rate of growth in GNP—or grow as a percentage of disposable income—for very long. A quote attributed to Herb Stein, chair of the US Council of Economic Advisers under president Richard Nixon, fits well: “If something can’t go on forever, it won’t.” Some art price bubbles deflate slowly; sometimes the bubble bursts. Whatever the rate of deflation, the likelihood is that it will happen sooner rather than later.
Sometimes bubbles deflate with dramatic impact. The most recent art bubble appeared in the second quarter of 2008. The final three months of 2007 saw the beginning of an economic recession, and art prices followed stock market and housing prices downward. There was a five- to seven-mont
h lag in the drop in auction prices; prices for art at auction were propped up by auction house guarantees offered months earlier. Price levels in contemporary art auctions in Hong Kong, Beijing, Dubai and Moscow all cratered in the second half of 2008.
Many 1-percenters continued to buy art, but offered lowball bids at auction or demanded high discounts from dealers and private sellers. Few works were offered at auction with estimates over $1 million. Auction specialists told potential bidders that estimates could be ignored. That meant that reserve prices (below which the auction house will not sell) had been lowered by concerned consignors. This was happening when (as is still true) interest rates were close to zero.
By mid-2009, prices for museum-quality contemporary art had stabilized, down between 10 and 15 percent from early 2007 levels. The number of $1-million-plus contemporary sales at auction dropped almost 80 percent from 2007 to 2009. Prices in the middle third of the contemporary market were down 40 percent; in the bottom third, down 50 to 60 percent.
About 15 percent of New York and London galleries closed their doors in the eighteen months beginning in February 2008. Every gallery that closed left twenty-five to thirty artists orphaned, without dealer representation. Other dealers relocated to less expensive quarters, or sold from apartments. From 2007 to 2009 the number of significant art fairs around the world shrank from 425 to about 225. Fairs that survived offered more conservative and moderately priced art to attract older buyers and older money.
The market began its upswing in early 2010. By mid-2011, prices at the top of the market had returned to 2007 levels. The middle and lower segments did not fully recover until 2012.
There are bubbles that are artist-, sector- or country-specific. Individual artist bubbles are common. These inflate and burst all the time, sometimes from speculation and changes in taste and fashion, sometimes from the exit of key buyers. German artist Matthias Weischer, represented by Galerie EIGEN + ART, had his large paintings go from a gallery price of €25,000 ($30,000) in 2004 to an auction price of £210,000 ($305,000) at Christie’s in 2005. His 2003 painting Wand (Wall) sold at £105,000 ($125,000) at Sotheby’s London in 2006, went unsold with a €160,000 ($200,000) estimate at Berlin’s Villa Grisebach Auktionen GmbH in 2008, then brought €48,000 ($58,000) at the same auction house in 2011.