Sotheby's, one of the world's largest auction houses along with Christie's, made a comeback to Korea this week with the opening of a new space in Seoul nearly three decades after its initial withdrawal.
The auction house became the first international player to enter the domestic market when it established a regional office in Seoul back in the early 1990s, but withdrew from the scene a decade later.
The powerhouse's re-entry into the city, which is in line with its recent drive to double down on the expansion of its footprint across Asia, points to Seoul's status as a rising art capital that has already attracted a flurry of global galleries to open their outposts alongside the launch of Frieze Seoul last year.
"You see an increased market momentum here. The arts transaction volumes in Korea have been skyrocketing, going from about $300 million in 2019 to nearly $800 million in 2022. And we have, in fact, seen a similar increase in the global bidding activity from our Korean clients (in the same period); their bidding amount has almost tripled," said Nathan Drahi, managing director of Sotheby's Asia, in his interview with The Korea Times at the company's new Seoul space nestled in Hannam-dong, Yongsan District.
Most of Sotheby's Korean clients' purchases are of contemporary art ― from the likes of David Hockney and Adrian Ghenie to Kim Whanki and Park Seo-bo ― but there is a rising interest in luxury items as well, according to the company. Nearly 40 percent of the bids in the luxury category are placed on streetwear, followed by watches and wine.
The director added that since 2020, nearly three-quarters of buyers from the country were new to the auction house.
The surge in participation from Korean buyers and bidders in global auctions, including a new generation of young collectors, mirrors a broader trend that leading auction houses have been witnessing across Asia over the past few years.
In the first half of 2023 alone, Asian collectors represented one-third of the total transactions at Sotheby's international sales. And 40 percent of its clientele in the continent is below 40 years old.
"With Asia being more on the uprising of the collecting path, there tend to be more younger people who are collecting (than other parts of the world) ― either self-made or second- or third-generation wealth," Drahi said. The major auction companies' incorporation of digital platforms and live streaming of their marquee sales, spurred by the COVID-19 pandemic, has also been a catalyst of the influx of such young, monied customers.
Together with the visibly growing collector base, one factor that enables Seoul to hold its own as a rising art hub, when compared to other locations in Asia, is the "prevalence" of arts and culture in the country, the director noted.
"I would say Korea is one of the most developed art ecosystems in the region. It's much more balanced, with key stakeholders occupying different parts of the market ― Korean and (blue-chip) international galleries, local auction companies, public museums and global players like us."
The country's more balanced cultural landscape between the private and the public differs from other cities like Hong Kong, whose transaction-oriented atmosphere makes it a favorable business environment but one that lacks comprehensive institutional foundations.
Sotheby's expansion in Seoul comes after major local auction houses reported steep declines in sales in the first half of 2023 ― a 47 percent drop compared to the same period last year.
While acknowledging the apparent market slowdown in Korea, Drahi said that it is still important to take a step back and look at the art market's overall growth trajectory within the last few years.
Even after considering this year's decline in secondary market sales, the total art transaction volumes ― which peaked at nearly $800 million last year, an all-time high figure ― would realistically remain higher than before the market saw unprecedented, frenzied turnover. In other words, the current dip in sales does not necessarily signify a downturn in the art market, but rather a correction after a period of intense activity.
"It still means a sizable growth all in all, and I think it validates international companies like ourselves or art fair holders in their move into the country," he added.
While Sotheby's won't be conducting local transactions or auctions in Korea, with a new physical space in Seoul, it will play a more active role in engaging with the collector base, Drahi noted.
"Market interest is not conveyed purely through transactions or bidding. It's also through people asking us questions, requesting us to have their property appraised, etc. So we'll be able to capture those nuances that are less transactional in nature."
As part of its initiative to bring the local art lovers closer to the global trend of the art scene, the company is currently co-hosting "Love in Paradise: Banksy and Keith Haring" at Paradise City in Incheon, bringing 32 masterpieces by the British street artist and the American Pop Art icon, including Banksy's "Girl without Balloon."
The Seoul office is being led by Jane Yoon, managing director of Sotheby's South Korea. Yoon has previously held positions in Art Basel Hong Kong and Christie's Hong Kong. She was also the inaugural regional director of Phillips' Seoul office, which opened in 2018.
"We're starting with an organically nice little footprint with an office in the center of the city and we'll continuously assess opportunities to do more. So we'll be open-minded," Drahi said.