IBRA needs no help from Christie's
<p>IBRA needs no help from Christie's</p><p>By Amir Sidharta</p><p> JAKARTA (JP): The audience that filled the salesroom was taken
by surprise when eager and aggressive collectors bid up Affandi's
Perahu Kusamba from a modest starting price of Rp 44 million to
an astronomical Rp 158 million. This was only the first lot at
the Indonesian Bank Restructuring Agency's (IBRA) art auction,
held at the Menara Citibank building in Pondok Indah, South
Jakarta, last weekend.</p><p>The third to sixth pieces in the auction, by Dutch-born
Indonesian artist Arie Smit, also fetched astronomical prices.
The first piece, a charming, bright-colored painting measuring
30x40 centimeters, fetched a surprising Rp 58 million. Meanwhile,
the following two pieces fetched Rp 27 and Rp 28 million
respectively. The fourth Smit sold for Rp 58 million. All four
pieces were sold at five times their starting prices.</p><p>Another big surprise was a painting of dancers by veteran
artist Bagong Kussudiardjo. It reached Rp 22 million, over eleven
times its starting price of Rp 1.75 million. A work by Erica
Hestu Wahyuni fetched Rp 27 million.</p><p>This auction seemed to fetch higher prices for Indonesian art
than Christie's or Sotheby's Singapore auctions the previous
week.</p><p>In the salesroom, one could have forgotten that Indonesia was
undergoing an economic crisis. It seemed just like the good old
days when the "big boys" started collecting art beginning in
1994. So, what is going on?</p><p>While the organizers of the IBRA auction boasted of low prices
for the art pieces in the auction, they did not list estimates or
give starting prices. They also held three exhibitions and a
bazaar with lottery auctions which once again emphasized low
prices. Media reports also stressed the low prices of the works
being offered.</p><p>Judging from the works which were the most sought after, it is
clear that most of the bidders are new collectors who have little
experience with art auctions. Lured by the advertised low prices,
they flocked to the salesroom.</p><p>The rest of the attendees seemed like they were at the horse
races. The lower the price of a painting, the more interest the
people showed in the work. Once in pursuit, bidders felt an urge
to land their piece. The urge was even greater when they were
challenged by other bidders.</p><p>Auction beginners do not normally set limits for themselves,
and even if they do, they tend to ignore these limits when they
get caught up in the emotion of the bidding. Among beginner
bidders there seems to be a real urge to win pieces at these
auctions. How else can one explain a work by Erica going for Rp
27 million when at art galleries her works of the same size go
for between Rp 10 and Rp 15 million?</p><p>Unlike other art auctions which previously have been held in
Indonesia, this auction was free from the presence of government
officials, their family members and friends to ensure good sales.</p><p>In the past, government officials often would "persuade"
conglomerates or businessmen to buy certain pieces. On the other
hand, their presence often could dissuade conglomerates and
businessmen from pursuing a piece.</p><p>At this auction, anyone who paid the auction registration
guarantee of Rp 1 million per session was free to bid. And bid
they did. Apparently the free market is better than cronyism in
getting people to buy at auctions.</p><p>Art market observers and Christie's consultant Agus Dermawan
T. criticized auction organizers for placing such low starting
prices on the works.</p><p>"Putting such low starting prices for works by Bagong
Kussudiardjo should have been avoided. In this auction it just so
happened to have worked out because there were some buyers."</p><p>"However, the organizers should have been more cautious about
what they might have done to the market for an artists' works had
there been no buyers," Dermawan said. One observer saw Dermawan's
comments as a reflection of jealousy.</p><p>When it comes to art appraisals, Dermawan usually is invited
to participate. However, the organizers did not seek his advice
for this sale.</p><p>Dermawan's comments seem contrary to the policy of auction
houses in general.</p><p>Deborah Iskandar of Christie's once said that auction houses
prefer starting prices to be lower rather than higher so that
more people will be interested in bidding for the pieces. Perhaps
this is the reason why bidding at Christie's and Sotheby's
auctions start at about 60 percent to 70 percent of the estimates
for the pieces.</p><p>Therefore, it seems clear that the organizers of the IBRA
auction set low starting prices as part of their strategy to
attract more people to bid. And it worked.</p><p>In the end, very few pieces were left unsold. Only one of the
58 pieces on offer the first day did not sell, while on the
second day only one item was left unsold in the morning session.</p><p>So, the auction easily sold 99 percent of the items they
offered. This certainly is better than Christie's or Sotheby's
auctions. Even in good times, the two auction houses only sell
about 70 percent of the items they offer at an auction. So,
taking this into account, Balindo did very well.</p><p>While Thailand's Bank Restructuring Agency sought help from
Christie's in organizing their art auctions last year, the
Indonesian Bank Restructuring Agency were quite confident
cooperating with PT Balai Lelang Indonesia (Balindo), a
relatively unknown local auction house.</p><p>Fortunately, the local auction house was professional in
handling the auction. There is no guarantee that Christie's or
Sotheby's would have done as well with this auction.</p><p>A friend jokingly said the success of the auction showed that
some of the bankers seemed to have better judgment in art than
loans. Of course, this is not entirely true. However, what is
true is that the liquidated banks fortunately had these art works
as part of their assets. In an economic crisis like this, art
works certainly are more liquid than real estate.</p>
by surprise when eager and aggressive collectors bid up Affandi's
Perahu Kusamba from a modest starting price of Rp 44 million to
an astronomical Rp 158 million. This was only the first lot at
the Indonesian Bank Restructuring Agency's (IBRA) art auction,
held at the Menara Citibank building in Pondok Indah, South
Jakarta, last weekend.</p><p>The third to sixth pieces in the auction, by Dutch-born
Indonesian artist Arie Smit, also fetched astronomical prices.
The first piece, a charming, bright-colored painting measuring
30x40 centimeters, fetched a surprising Rp 58 million. Meanwhile,
the following two pieces fetched Rp 27 and Rp 28 million
respectively. The fourth Smit sold for Rp 58 million. All four
pieces were sold at five times their starting prices.</p><p>Another big surprise was a painting of dancers by veteran
artist Bagong Kussudiardjo. It reached Rp 22 million, over eleven
times its starting price of Rp 1.75 million. A work by Erica
Hestu Wahyuni fetched Rp 27 million.</p><p>This auction seemed to fetch higher prices for Indonesian art
than Christie's or Sotheby's Singapore auctions the previous
week.</p><p>In the salesroom, one could have forgotten that Indonesia was
undergoing an economic crisis. It seemed just like the good old
days when the "big boys" started collecting art beginning in
1994. So, what is going on?</p><p>While the organizers of the IBRA auction boasted of low prices
for the art pieces in the auction, they did not list estimates or
give starting prices. They also held three exhibitions and a
bazaar with lottery auctions which once again emphasized low
prices. Media reports also stressed the low prices of the works
being offered.</p><p>Judging from the works which were the most sought after, it is
clear that most of the bidders are new collectors who have little
experience with art auctions. Lured by the advertised low prices,
they flocked to the salesroom.</p><p>The rest of the attendees seemed like they were at the horse
races. The lower the price of a painting, the more interest the
people showed in the work. Once in pursuit, bidders felt an urge
to land their piece. The urge was even greater when they were
challenged by other bidders.</p><p>Auction beginners do not normally set limits for themselves,
and even if they do, they tend to ignore these limits when they
get caught up in the emotion of the bidding. Among beginner
bidders there seems to be a real urge to win pieces at these
auctions. How else can one explain a work by Erica going for Rp
27 million when at art galleries her works of the same size go
for between Rp 10 and Rp 15 million?</p><p>Unlike other art auctions which previously have been held in
Indonesia, this auction was free from the presence of government
officials, their family members and friends to ensure good sales.</p><p>In the past, government officials often would "persuade"
conglomerates or businessmen to buy certain pieces. On the other
hand, their presence often could dissuade conglomerates and
businessmen from pursuing a piece.</p><p>At this auction, anyone who paid the auction registration
guarantee of Rp 1 million per session was free to bid. And bid
they did. Apparently the free market is better than cronyism in
getting people to buy at auctions.</p><p>Art market observers and Christie's consultant Agus Dermawan
T. criticized auction organizers for placing such low starting
prices on the works.</p><p>"Putting such low starting prices for works by Bagong
Kussudiardjo should have been avoided. In this auction it just so
happened to have worked out because there were some buyers."</p><p>"However, the organizers should have been more cautious about
what they might have done to the market for an artists' works had
there been no buyers," Dermawan said. One observer saw Dermawan's
comments as a reflection of jealousy.</p><p>When it comes to art appraisals, Dermawan usually is invited
to participate. However, the organizers did not seek his advice
for this sale.</p><p>Dermawan's comments seem contrary to the policy of auction
houses in general.</p><p>Deborah Iskandar of Christie's once said that auction houses
prefer starting prices to be lower rather than higher so that
more people will be interested in bidding for the pieces. Perhaps
this is the reason why bidding at Christie's and Sotheby's
auctions start at about 60 percent to 70 percent of the estimates
for the pieces.</p><p>Therefore, it seems clear that the organizers of the IBRA
auction set low starting prices as part of their strategy to
attract more people to bid. And it worked.</p><p>In the end, very few pieces were left unsold. Only one of the
58 pieces on offer the first day did not sell, while on the
second day only one item was left unsold in the morning session.</p><p>So, the auction easily sold 99 percent of the items they
offered. This certainly is better than Christie's or Sotheby's
auctions. Even in good times, the two auction houses only sell
about 70 percent of the items they offer at an auction. So,
taking this into account, Balindo did very well.</p><p>While Thailand's Bank Restructuring Agency sought help from
Christie's in organizing their art auctions last year, the
Indonesian Bank Restructuring Agency were quite confident
cooperating with PT Balai Lelang Indonesia (Balindo), a
relatively unknown local auction house.</p><p>Fortunately, the local auction house was professional in
handling the auction. There is no guarantee that Christie's or
Sotheby's would have done as well with this auction.</p><p>A friend jokingly said the success of the auction showed that
some of the bankers seemed to have better judgment in art than
loans. Of course, this is not entirely true. However, what is
true is that the liquidated banks fortunately had these art works
as part of their assets. In an economic crisis like this, art
works certainly are more liquid than real estate.</p>