Gold Rush

Until a few decades ago, Gustav Klimt was relatively ignored by the art establishment. Now his paintings are among the most expensive ever sold. How did the Viennese painter’s prices rise so high so fast?.

Klimt’s Apple Tree I, ca. 1912, sold for $33 million, breaking the artist’s previous auction record of $29.1 million.

Klimt’s Apple Tree I, ca. 1912, sold for $33 million, breaking the artist’s previous auction record of $29.1 million.


When Ronald Lauder, the cosmetics heir, art collector, Neue Galerie cofounder, and chairman emeritus of the Museum of Modern Art, shelled out a reported $135 million for Gustav Klimt’s Portrait of Adele Bloch-Bauer I(1907) last June, many observers were shocked not only by the amount paid—one of the highest known prices for a single painting to date—but also by the name of the artist it was paid for.

How, they wondered, did a work by Klimt, who was largely ignored by the art establishment just a few decades ago, suddenly vault more than four times to a previous auction record of $29.1 million? How did he surpass even Picasso, whose $104.2 million Blue Period Boy with a Pipe (1905)—still a much discussed market milestone two years after the fact—officially holds the slot for the most expensive painting sold at public auction?

The answer involves a mix of factors, including the painting’s extraordinary provenance and recent history, Lauder’s passion for and pursuit of this particular work, and the soaring demand for German and Austrian Expressionism, along with the explosive growth of the broader art market.

The gold-ground portrait of Adele Bloch-Bauer—the wife of Austrian sugar magnate Ferdinand Bloch-Bauer, who fled Austria during World War II—is considered one of Klimt’s best works. The elaborate portrait of a seated Adele, executed over the course of three years, features a dazzling array of gold patterns and layered shapes, with the fabric of her gown seeming to meld with the furniture and walls surrounding her. Much has been written about Adele’s sensual expression and Klimt’s erotic depiction of her, and speculation about an affair between Klimt and his subject has only increased the public’s fascination with the painting.

After a nearly eight-year battle between the Austrian government and the Bloch-Bauer heirs—led by the couple’s niece Maria Altmann and her attorney E. Randol Schoenberg—the painting was one of five restituted to them earlier this year from the Austrian Gallery Belvedere in Vienna. The Nazis had seized the paintings in 1938, along with much of the contents of the Bloch-Bauers’ home. The museum claimed ownership of the work based on Adele’s 1923 will, but additional information related to the case was made public in 1998 when the Austrian government passed a law that opened archives. Ferdinand, who died in Switzerland in 1945, left his estate to Altmann and two of her siblings. Last January, after the U.S. Supreme Court ruled that Altmann could sue Austria in a U.S. court, a three-judge panel in Austria unanimously ruled in favor of a claim brought by Altmann and the other Bloch-Bauer heirs.

The excitement clearly boosted Klimt’s market and translated into further astounding prices when the four remaining works were sold at Christie’s Impressionist and modern sale in New York last November. Adele Bloch-Bauer II, a 1912 portrait with more somber tones, widely viewed by experts as reflecting that the affair between artist and sitter was over by that time—“the bloom is off the rose,” says one source—commanded $87.9 million. It was far above Christie’s $40 million/$60 million presale estimate and nearly three times Klimt’s previous auction record. In addition to being one of the most expensive artists ever, Klimt now holds the distinction of being the second most expensive artist at auction after Picasso.

The remaining Klimt works sold over estimate: Birch Forest (1903) fetched $40.3 million; Apple Tree I (ca. 1912) sold for $33 million; and Houses at Unterach on the Attersee (ca. 1916) realized $31.4 million. Collectively the five restituted works reaped more than $327 million.

Lauder calls Adele I the Neue Galerie’s “Mona Lisa” and a “once-in-a-lifetime acquisition.” Lauder, who is on the ARTnews list of the world’s top ten art collectors, says he first saw Klimt’s work at the age of 14 in Austria. After traveling with his family in France, he went on his own to Vienna specifically to see the Klimts in the Belvedere. It was “like finding the holy grail,” he told ARTnews in a telephone interview. “I was actually blown away by it. I had never seen such powerful images as The Kiss and Adele I.”

He adds, “I was into Art Nouveau, turn-of-the-century art, but this was the time of Monet; everyone was talking about French Impressionism.” Shortly after seeing Adele I for the first time, he purchased his first Egon Schiele work, a 1908–9 drawing of a woman with striped stockings (now in the Leopold Collection in Vienna), and a 1910 Klimt drawing that is still in his collection. “There was this excitement of discovery,” he recalls. “Nobody I knew knew of Klimt and Schiele.”

Lauder first met Schoenberg and Altmann in the 1990s and kept in touch with them over the next few years about proceedings regarding various restitution cases and disputed artworks. Steve Thomas, a partner at the Los Angeles–based law firm Irell & Manella who was brought in as an adviser to the heirs following the restitution decision last January, says Lauder had immediately “telegraphed” his interest in Adele I with phone calls to Altmann in January and to Schoenberg several weeks later.

Soon after, Lauder called Thomas and “immediately introduced himself as someone who was very interested” in Adele I, says Thomas. “Ronald’s view of the transaction was to get in early, express the interest, and make it clear: ‘Don’t do anything with it until you’ve talked to me.’”

Lauder recounts that soon after he knew the paintings had left Austria, he met with Thomas, and they agreed on a price for Adele I. Asked how they arrived at the price, or whether he had any hesitations, Lauder responded firmly: “No. It was just a question of how much it would take to buy the painting without having to go to auction. It took about three seconds.”

Although Thomas describes Lauder as “tireless, dedicated, and passionate in his efforts to address the family’s goals and in the pursuit of the painting on behalf of Neue Galerie,” he laughs when asked if the deal took a matter of minutes. “I call him on it every time,” he says. Thomas tells how, at the opening of the Neue Galerie’s exhibition of Adele I, Lauder told a reporter that the deal took 20 seconds. Recounts Thomas: “I said, ‘Ronald, what are you doing?’ and he responded, ‘Well, how long do you think it took? Two minutes? Three minutes?’”

Thomas declined to specify how long the deal took, saying only that “there were several weeks of discussions.” After he was initially contacted by Lauder, “serious discussions” did not start until a couple of weeks later, after Altmann and the other heirs had time to consider their options. Thomas declined to discuss details of the negotiations for the reported $135 million price, although he specifies: “The family did not put a price on the painting.” He also declined to say how the price was determined.

Thomas says that approximately seven to ten serious international collectors and three to five museums (both abroad and in the United States) had shown interest in the Klimt works, although he declined to identify the potential buyers. None of the competing collectors was Austrian. Asked whether the heirs initially intended to sell the works as a group, Thomas says that they received some serious offers for all five paintings. These offers, he notes, were from private collectors or investor groups that did not intend to provide for permanent public display of the works.

One source familiar with the transaction, who declined to be identified, describes the negotiations as an “unpleasant experience for a lot of people” in terms of mixed messages about competing bids. “They always knew they were selling it to Lauder, but they were strategizing with everyone to keep pressure on him to make sure he came up with a knockout bid. My sense is that they were acting as though they were entertaining offers but were shrewdly representing them to him so that Lauder never felt a letup of the pressure. I guess it is [the attorney’s and heirs’] right to keep as many people in the game and keep up as much pressure as possible. But deals were done long before people knew about them.”

Lauder insists he didn’t feel any pressure or worry about competition: “I didn’t even think of that.”

Thomas replies, “There was competition; he knows there was competition.”

But, says Thomas, “There was no posturing or game playing. The deal got done because there was no hidden agenda. It happened because it met all of the heirs’ requirements and satisfied Lauder’s desire to show the work at the Neue Galerie. He knew he was under very tight time pressure.” Thomas adds, “We never used him as a stalking horse; we didn’t come back and say, ‘This person offered this; you need to up your offer.’”

Both Sotheby’s and Christie’s competed for consignment of the remaining works. The heirs ultimately chose Christie’s because of Maria Altmann’s friendship with Stephen Lash, chairman of Christie’s Americas. When Christie’s was chosen to advise the Bloch-Bauer heirs on the sale of the four remaining Klimts in early August, the auctioneer did not indicate whether the paintings would be sold at auction or privately. “Clients got a lot of mixed messages from Christie’s as they were trying to assess the level of interest and where they might stand with the guarantees,” according to the source. “I think they really played everybody.”

Guy Bennett, Christie’s head of Impressionist and modern art, says that the performance of the Klimts at auction speaks for itself. “Certainly from where I was standing, the market responded in an incredibly positive manner,” says Bennett, who handled the winning bid for Adele II via telephone.

While two other phone bidders went head-to-head as the price rose through the $50 million to $60 million level, Bennett’s bidder entered the competition at $74 million—suggesting that he or she wanted it no matter how high the price went—and eventually won the work with a final bid around $78 million before premium.

The Los Angeles County Museum of Art, which exhibited the five Klimts on their return from Austria, was known to be an interested bidder. Director and CEO Michael Govan said in a statement to ARTnews last June: “I’m sad [Adele I] won’t be staying in Los Angeles, but I am pleased it will be on view in an American museum.” A museum spokesperson said she had no other information about the museum’s bid. According to published reports, however, Govan had been making daily calls for months and was interested in acquiring all five of the Klimt works.

Adele I is now on view as part of the permanent collection of the Neue Galerie on Manhattan’s Upper East Side, where it has been drawing record crowds since its debut last July. (The four other Klimts were shown alongside it for two months last summer.) But the jury is still out on whether Klimt is a $135 million artist. Depending on which expert you consult, the gold portrait is either worth every penny or an overhyped—and overpriced—picture.

Simon de Pury, chairman of the auction house Phillips, de Pury & Company, says Adele I is the “ultimate masterpiece of one of the great modern masters of the early 20th century,” adding that he “was not surprised by the price. There are very few works of that caliber, and if and when something of that quality comes on the market, anything is possible. In hindsight, it will not be seen as something crazy. It is a brilliant coup.”

In a New Yorker column last July, art critic Peter Schjeldahl wrote: “Is she worth the money? Not yet. Lauder’s outlay predicts a level of cost that must either soon become common or be relegated in history as a bid too far. And the identity of the artist gives pause… until a few years ago, the artist ranked as a second-tier modern master.”

Whatever Klimt’s position in the “pantheon of art history or whatever the pecking order about his reputation, Klimt’s work is a perfect, nostalgic reflection of a great moment in cultural history—Vienna at the turn of the century,” says Robert Rosenblum, a professor of art history at New York University’s Institute of Fine Arts and curator of 20th-century art at the Guggenheim Museum in New York. Rosenblum declined to comment on the reported price of Adele I, noting that he generally does not follow sale prices. “This has nothing to do with whether he is a great, indispensable artist. He’s not van Gogh, Munch, or Picasso, but he has the ability to capture in his art an entire society. For a lot of people, it’s time travel.” He adds: “I myself love Klimt up to a point, but it’s like going to a Viennese bakery.”

According to Los Angeles Times art critic Christopher Knight, “the master narrative of 20th-century modernism goes through Paris; it’s a Parisian story, and Germany and Austria are always tangential.” But, he notes, “there has been some change in that kind of thinking in the last 20 years or so.”

Before the Christie’s sale, Knight said that the $300 million figure for the five Klimts—which had been floated in various press reports—“established an inflated benchmark.” Commenting on the results of the auction, Knight says that “the whole brouhaha over the sale of Adele I did nothing but enhance the market value of the remaining works.”

Jane Kallir, director of Galerie St. Etienne in New York, told ARTnews, “I was in no way, shape, or form surprised” at the reported price of Adele I. “We are in an era in which premium prices are being paid for trophy objects.”

Gérard Goodrow, director of the Art Cologne fair, echoes the view that Adele I is in a class by itself. “It’s a mistake to view this as a sort of Iron Chef battle between Klimt and Picasso,” he comments. “This is not Klimt versus Picasso. This is Klimt versus those Picassos.”

Klimt, who died in 1918, did not have a solo show in the United States until 1959 at Galerie St. Etienne. In an ARTnews review, one critic stated: “The American public has become aware of him only recently…. This neglect seems undeserved.” But the critic also notes: “Klimt’s best works are his landscapes. As a portraitist, Klimt was less successful.”

The artist’s work had long been featured in group shows at St. Etienne, says Kallir, but his counterparts Schiele and Oskar Kokoschka were better known in the United States, because significant works were more readily available. “It was because of the scarcity of Klimt’s paintings on the American market that he didn’t become known sooner in the U.S.,” she says.

“There is no question that works on paper by Schiele are more plentiful,” says David Norman, head of the Impressionist and modern art department at Sotheby’s. Further, “there has been a very notable increase” in the number of sales and the level of prices for Schiele’s work in recent years, he says, noting that the artist’s oil paintings rarely come up at auction.

The $22.4 million record for a Schiele work was established at Christie’s last November for the 1915 oil Single Houses (Houses with Mountains) . The painting was one of three Schiele works from the Neue Galerie’s collection that Lauder sold to help finance the purchase of Adele I. Together they made $39.2 million.

Meanwhile, Norman points out, sales of Kokoschka oils have also been infrequent, with the record price of $2.97 million established more than 15 years ago. “So little has come on the market in recent years,” he says. “You need the right combination of rarity and supply to really maintain and move a market.”

At first, Klimt and Schiele got the cold shoulder from American museums and collectors. Otto Kallir, Jane’s grandfather, who founded St. Etienne in New York in 1939, was a key figure in changing that. In 1956 he donated Klimt’s The Pear Tree (1903) to Harvard University’s Fogg Art Museum; it was the first work by the artist to enter a U.S. institution (and was later transferred to the school’s Busch-Reisinger Museum, which is devoted to art from German-speaking countries). In 1957 he sold MoMA its first Klimt, The Park, executed in 1910 or earlier. And in 1960 the Carnegie Museum of Art in Pittsburgh bought Klimt’s painting Orchard (Garden Landscape), executed before 1916, also from Kallir. The museum acquisitions coupled with the 1959 solo show at St. Etienne marked a turning point, says Jane Kallir. In 1965 the Guggenheim Museum mounted a dual show of Klimt and Schiele. In a March 1965 review in the Washington Post, critic Anthony West blasted the show as an attempt to “float two Viennese second-raters” and deemed Klimt’s late paintings Danae and Leda “dottily erotic.” Along with the 1907-8 painting The Kiss, West wrote, the works “show the essence of the vulgar fraud that his ‘art’ truly was.”

Afterward, prices for Klimt’s and Schiele’s works began to rise, boosted by a group of focused collectors, many from Europe. By the late 1970s, Klimt landscapes were selling for prices ranging from $400,000 to $600,000, and some of his Secessionist works were fetching from $500,000 to $1 million.

In 1978 MoMA, hoping to trade up to a better Klimt, arranged to sell The Park to New York dealer Serge Sabarsky for $500,000. (A longtime associate of Ronald Lauder, Sabarsky was cofounder of the Neue Galerie; he died in 1996.)

MoMA had its sights on Klimt’s 1907–8 painting Hope II, which the museum and its outside advisers considered more historically important. Lauder stepped in to cover the unspecified difference between the price of The Park and that of Hope II. Eventually the museum—some of whose trustees felt torn over having to choose—raised the funds to retain both Klimts.

Prices for Klimt and German Expressionist works continued to rise with the art market throughout the 1980s. In 1984 Klimt’s Life Is a Struggle (1903)—said to be one of the few paintings that had left Austria at that point—sold to Galerie St. Etienne for $981,646 at Sotheby’s, then an auction record for the artist. In 1987 at Sotheby’s London, Kammer Castle on the Attersee II (ca. 1909) soared to $5.28 million, with the winning bid coming from Marlborough Fine Art. Less than two years later, the record price for a Klimt painting doubled again when the Aichi prefectural government museum in Japan paid $11.4 million for Life Is a Struggle. Prior to Christie’s November sale, the record for Klimt stood at $29.1 million, achieved at Sotheby’s in 2003 for Country House on the Attersee (1914).

Nicholas Maclean, a New York dealer and former co-head of Christie’s Impressionist and modern art department, says of Adele I, “We’ve never seen a Secession picture take a price like this, but it’s driven by a number of things. Great pictures find themselves in a different price bracket—in some cases they can be worth 1,000 percent more than a good work by the same artist.” He adds: “What would van Gogh’s Dr. Gachet get if it came up at auction today?”

In 1997 the record for Klimt hit £14.5 million ($23.5 million) at Christie’s London. At the time, amid speculation that Lauder was the buyer of Kammer Castle on the Attersee II, he issued a statement to the ARTnewsletter through his curator, Elizabeth Kujawski: “This is an artificial market created by one person who has bought the last three Klimts at auction. In all cases the values of the paintings were only half of what they sold for. The average price of a Klimt should be $6 million to $7 million.”

Asked about this recently, Lauder said that he had been concerned that two collectors fighting for Klimt’s work were driving prices to irrational heights. Of the price he reportedly paid for Adele I, he says, “I didn’t even think of that. I knew there was nobody who wanted the painting more than me.”

Eileen Kinsella is editor of the ARTnewsletter.

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