South Korean auction house Seoul Auction is hoping to interest Chinese and other Asian collectors in modern Western and contemporary art, with the lofty aim of beating Sotheby's and Christie's in the region.
The 11-year-old auction house, which earlier this year sold British artist Damien Hirst's first work in Asia, is keen to build a regional presence through Hong Kong auctions of Western and Asian works, and in a market where antiques, rather than paintings, represent 60 percent of transaction volume.
Jun Lee, who heads Seoul Auction Co Ltd (063170.KQ), said he has seen strong demand from Taiwan, Indonesia and South Korea at previews and sales, with more people buying art as an investment.
"We started from a point of view: Let's do what Sotheby's and Christie's are not doing. That is post-war contemporary arts," Lee, whose house was founded by top South Korean gallery operator Gana Art Gallery, told Reuters.
"It's uncharted territory," said the 20-year art market veteran.
Seoul Auction is the only Asian firm challenging the two big global houses that dominate Hong Kong's art market and focus on Chinese modern paintings, Asian contemporary arts and antiques.
Other competitors in the world's third-largest art market are small-sized local auctioneers.
Lee, 44, expects both Sotheby's and Christie's to remain focused on those categories in Asia, while offering Western artworks in London and New York.
By comparison, Seoul Auction, which controls nearly 60 percent of the South Korean art market, sold "Tranquility" from Hirst's "Butterfly Series" for $1.71 million in May, which at the time was the highest price ever paid for a work by the artist.
The company aims to take a fifth of the Hong Kong auction market by next year by introducing a variety of artists and broadening its client base to those who can afford to invest up to $10,000 in artworks.
Lee introduced works by American pop artists Roy Lichtenstein and Jasper Johns to South Korea in the 1990s while he was at Gana Art Gallery. Seoul Auction set a local record of $7.9 million for a Lichtenstein painting last year.
Demand for Asian antiques has remained steady in Asia, but contemporary art felt the pinch of the recession.
Lee expects the global art market to recover in the first half of next year, and sees the Asian market growing five-fold in the next 3-5 years as economic growth returns.
"Speculative buyers are out of the market now. It is selective, and quality is important," Lee added.
He recommends investors focus in the downturn on modern paintings that retain their investment value, but warned that Chinese contemporary art prices could come under pressure after a record-breaking rally.
Seoul Auction will hold its 2009 Hong Kong autumn sales on Wednesday, comprising 93 artworks, with an estimated value of close to $12 million, including works by Damien Hirst, Cy Twombly, China's Sanyu and Andy Warhol. (Editing by Miral Fahmy)