€160 Million Essl Collection Will Be Liquidated
Sales will start in London this October.
A majority of the 7,000-work-strong Essl Collection will be sold off in London this October, according to a report in the Handelsblatt‘s Friday print edition. According to appraisals of the collection earlier this year by both Sotheby’s and Christie’s, the 5,000 works that are headed to the auction block are worth an estimated €160 million ($211 million). Of that sum, €100 million ($132 million) is in the collection’s 1,700 works by renowned artists including Gerhard Richter, Martin Kippenberger, Georg Baselitz, Alex Katz, and Markus Lüpertz. The remaining €60 million arises from works by Austrian artists and is particularly strong in works by the recently deceased Maria Lassnig.
The collection is currently displayed on a rotating basis in the Essl Museum in Klosterneuburg, Austria, just outside of Vienna. Karlheinz Essl, the founder and owner of Europe’s BauMax hardware store chain, assembled the collection and placed it within a charitable trust two years ago. However, an unsuccessful expansion of his company into Eastern Europe and Turkey has left it near-insolvent. The company lost €189 million in 2013 alone. Due to an Austrian law that only protects assets placed in trust from bankruptcy proceedings after five full years, should the company go under, the works would be subject to liquidation.
Instead, Essl has decided to sell the collection in order to save an estimated 4,000 jobs at BauMax (“Essl Museum Founder to Sell €86 Million Collection to Save Company“). The company currently employs an estimated 9,000 people. He initially attempted to sell the collection directly to the Austrian state. However, prominent members of both the public and private sector criticized the plan, suggesting that it was not the state’s obligation to save a company from its own miscalculations, regardless of any cultural worth the company and its owner’s assets may have (“Fears of Market Destabilization Cloud Proposed €250-Million Essl Collection Sale“).
When contacted by artnet News, neither Christie’s nor Sotheby’s press departments in London professed to be aware of the coming sale. However, due to their previous involvement in evaluating the collection, one or both will be responsible for offloading the collection. The initial sale will reportedly include the most highly-valued international works, with subsequent sales to follow on an unspecified schedule. The fate of the Heinz Tesar-designed Essl Museum building remains unclear.
The Collection’s Value
The collection has a book value of only €86 million. Austrian experts had previously valued it at upwards of €250 million if pieced off rather than sold as a whole, as Essl initially requested. International appraisers were apparently less impressed by the collection’s contents. Critics have repeatedly cited a generally middling quality of the works held within the collection. They point to Essl’s propensity to purchase whole series of works without regard to individual pieces’ quality as harming the Essl Collection’s reputation and value. Essl reportedly favored the practice as it allowed him to negotiate steep price reductions.
It’s those heavy-handed negotiating tactics that garnered him enough confidence to open the so-called “Collector’s Club,” an art investment scheme. Essl sold members of his fund works from his own stash with the promise that he would repurchase them for 150 percent of the initial price, 10 years down the line (“Speculative Art Fund Linked to Essl Collection Raises Integrity Issues“).
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