Strauss & co - 2016 Review

It is an auction truism that even in gloomy times the beautiful, the rare and the collectable will always attract discerning buyers. Bucking trends in a softening art market, Strauss & Co posted a record turnover of R215 million in 2016, the highest combined income achieved by the company in a single year since its inception in 2009. The outstanding result is a testament to Strauss & Co’s ability to bring quality work to the market, and its capacity to achieve a sell-through rate of over 80% at its four live auctions in Johannesburg and Cape Town. A year of headwinds, consolidation and unexpected dividends The year in review was marked by widespread political instability and a stagnant macro-economic context. The impact on the art market was tangible. In South Africa, the art auction market witnessed an overall decline in sales of 14% in the first half of 2016 as compared with the same period in 2015 – according to data compiled by George Herman of Citadel Wealth Management, and based on 17 benchmark auctions. Strauss & Co’s outstanding performance in 2016 is all the more noteworthy given the 21% decline in total turnover of the local art auction industry as a whole in the first half of 2016. The softening art market is directly attributable to economic circumstances. South Africa has the largest number of high-net worth individuals (HNWIs) on the African continent, approximately 38 500 with a combined wealth of R2.5 trillion (US$159 billion). According to Research and Markets, a market intelligence company that publishes the South Africa Wealth Report, between 2007 and 2015 the number of HNWIs in South Africa decreased by 10%, with a particularly sharp dip noticeable in 2015. Contributing factors included the depreciation of the Rand against the US dollar, falling equity markets and the migration of HNWIs out of the country. This objective data, while important, does not answer how Strauss & Co managed to navigate successfully these difficult market conditions. An important feature of the 2016 sales year, something that contributed to the impressive values achieved for individual works, was its offering of quality work from outstanding private collections. Paintings amassed by collectors Liselotte Hardebeck, Ruth and Jerome Siegel and Chris “Tos” Du Toit all attracted vigorous bidding, as did historic furniture pieces linked to the Vergelegen Estate in Somerset West. With Strauss & Co’s four live auctions firmly established as important calendar events, the company moved to diversify its sales platforms. The success of its five online auctions in 2016 confirms an emerging consensus. “For serious collectors, the internet has changed the hunt – and the rules,” reported The Washington Post in August. “It’s given collectors access to new worlds and upped competition, pitting dedicated seekers against neophytes.” Strauss & Co’s online-only auction in July grossed over R4 million, the highest amount ever for a StraussOnline auction. The November online auction of property from the Hardebeck estate was also a notable sale. The year under review will especially be remembered for the range and depth of the work offered at Strauss & Co’s four live auctions, and the solid prices achieved for sellers. Some of these works were previously held in international collections. Strauss & Co was able to secure important work held abroad, notably by Irma Stern, Alexis Preller and Walter Battiss, for disposal in South Africa. In an increasingly competitive local and international marketplace for South African art, Strauss & Co’s ability to estimate correctly and suitably market exceptional work continues to distinguish the company from its rivals. Commenting on Strauss & Co’s positioning within the local market, veteran British auctioneer Dendy Easton remarked: “Unlike in London, where there are usually thirty to forty people in a saleroom, and a bank of telephones, at Strauss & Co, the room is filled to capacity with literally hundreds of people plus plenty of activity on the telephones.” Easton, who is best known for his expert insights on the BBC programme Antiques Roadshow, was impressed by the comprehensive marketing that preceded every sale, from the company’s well-researched catalogues to its week-long programme of events before every sale. “Strauss & Co’s sales are not just auctions but much anticipated social and artistic events,” said Easton. Looking back, looking ahead by Sean O’Toole 10