Silver Liz by Andya Warhol

Perhaps the most exciting news in the art market in recent times has been the way Pablo Picasso came back to his original place as the highest priced artist, upsetting Alberto Giacometti's previous record set only two months back.

Picasso's Nude Green Leaves and Bust sold for $106,482,500 to an unidentified telephone bidder, setting a new world record for any work of art sold at auction. With it returned something that had been lost at international sale-rooms since the spring of 2008– drama. As Christie's lead auctioneer, Christopher Burge conducted the nine minute bidding between eight bidders, one at the saleroom and the others on telephone, silence was the hallmark as others present kept quiet to watch the breathtaking battle for a lascivious masterpiece.

And finally, the competition settled down to two bidders at the $88 million mark. The new record auction price for an artwork for Picasso's passionate painting of his muse, Marie-Thérèse Walter is $2m higher than his previous record for Garçon à la pipe set in 2004. The work came from the Frances Lasker Brody collection and sold at Christie's on 4 May 2010 generating almost one third of the sale's total revenue ($296.5m from 56 lots sold).

This, combined with the fact that Christie's and Sotheby's posted a combined revenue up 205% compared with the previous year's total at the end of the prestigious 'Impressionist & Modern Art sales' on 4 and 5 May, and that their combined results from the 'Contemporary Art sales' (11 and 12 May) were nearly 230% better than the previous year has given Artprice reason to conclude that the 'market effervescence has returned'.

Actually, this was evident from early May, when Christie's and Sotheby's confidently bet on high prices for masterpieces signed by Warhol, Klein and Rothko. What was important however was that the respective catalogues contained a number of major works that the previous year's crisis had withheld from the market. Among the 49 lots offered in Christie's 'Post-War and Contemporary Art sale' on 11 May, 29 were expected to generate results above the million-dollar line. While at Sotheby's, as has often been the case in recent years, the sale's success depended largely on Andy Warhol, the highest priced artist in the world behind Pablo Picasso. Christie's, which was also pitching Warhol's Silver Liz beside six other works against Sotheby's pitch of Warhol's Self Portrait, estimated him to generate 45 million dollars!

The 'Sale of Contemporary Art' at Sotheby's, of which Warhol was a part, totaled $189,969,000, well over the pre-sale estimate of $114/162 million (excluding buyer's premium), which led an ecstatic Tobias Meyer, Worldwide Head of Contemporary Art and the evening's auctioneer at Sotheby's to comment, “When you sail past a high estimate of $162 million (excluding buyer's premium) and achieve $189 million, that is a great result.” There was a lot of movement in classic material -- Pollock, de Kooning, Mitchell but there was also a lot of activity and great results for younger artists such Cattelan and Wool. Alex Rotter, Head of the Contemporary Art Department in New York, was candid in his summation--. “We're thrilled with the overall result we achieved this evening, which was our best since spring 2008.”

Actually so. While the Brody Picasso generated almost one third of the sale's total revenue ($296.5m from 56 lots sold at the Contemporary Art Sales at Christies), Warhol's Self Portrait from 1986 more than doubled the high estimate to sell for $32,562,500, and an Untitled Mark Rothko painting from 1961, soared over the high estimate to sell for $31,442,500 (est. $18/25 million).

Artprice, in its April 26 article had commented that, “Although the market's recovery since the autumn of 2009 certainly allows for a degree of optimism, the prices announced for (May auction) sales are particularly high, especially for works being “re-sold” relatively quickly. The results will of course tell us if these estimates are really in synch with the market.” In the same breath, there was also an optimistic note“With morale substantially repaired, the auction houses have started offering guaranteed prices again. These commitments, amounting to tens of millions of dollars for major works, reflect the auctioneers' confidence in the market's recovery.”

And the May sales amply reflected it. At the end of the May sales, the bought-in rates were particularly low: ranging from 6% (Sotheby's 'Contemporary Art sale') to 22% (Christie's 'Impressionist & Modern Art sale'). This can only mean that a large number of major collectors are clearly back in acquisitive mode, far outliving the long hiatus of the recession.

And that definitely is good news for the art-world.