HDH Wine

2016 Wine Auctions Hint at Strong Times to Come
Overall sales decline as Wally's halts auctions, but Sotheby's, Zachys and others report banner years and surging interest

Peter D. Meltzer
Posted: January 18, 2017


At first glance, the global wine-auction market's 2.1 percent decrease in sales during the past 12 months, from $345.9 million in 2015 to $338.7 million in 2016, appears as if the industry had an unexciting year. But those numbers obscure the details. For a handful of auction houses, 2016 was stellar. What's more, several auctioneers and auction executives were excited by customers' renewed interest in Bordeaux—and not just in top-tier châteaus.

Two factors significantly affected the end-of-year data negatively. First, Wally's Wine Auctions, an extension of the California-based retailer Wally's Wine & Spirits, suspended all auction activities in 2016. (In 2015, the firm grossed $12.65 million.)

Second, Christie's London reported a 45 percent drop in 2016. But that poor showing was largely due to the auction house's decision to withhold the results of the Avery Family Cellar sale. The auction, which Christie's held in October, offered treasures from a fourth-generation family of British wine merchants. Christie's London cited respect for the family's privacy in its refusal to share detailed results. This didn't stop industry insiders from speculating that the auction, which featured a comprehensive collection of old and rare wines, likely resulted in a strong sale that could have significantly skewed Christie's total numbers.

U.S. wine auctions rose to $168 million, up 2.2 percent from 2015, while the average price per lot climbed to $3,294 from $2,951. Looking back over the past year, Sotheby’s CEO Jamie Ritchie said, "New York sales were pretty vibrant, enabling [the city] to regain its title as the capital of the wine-auction world. A lot of wine sold in the U.S. still ends up in Asia, so America also remains the major source of fine and rare wines."

In Hong Kong, sales declined by 6.5 percent, to $92 million, and the average price per lot dropped to $4,634 compared to $5,438 in 2015, reflecting that more blockbuster sales were conducted in the U.S.

Around the globe, several auction houses enjoyed successful results. Foremost was Sotheby’s, which led global wine auctions with total sales of $73.8 million, up 22 percent from 2015. The acclaimed sale of the William I. Koch cellar in May—which brought in $21.9 million for the 20,000-bottle collection—was a big factor in the dramatic increase. A highlight was a 10-bottle lot of the celebrated Château Mouton-Rothschild 1945, which sailed above the presale estimate of $120,000 to bring in $343,000.

Zachys sales were also up, increasing 18 percent from 2015 to a total of $65.7 million. Jamie Pollack, Zachys' managing director for North America, attributes the rise to single-owner and domaine-direct sales. A standout example was the single-owner auction dubbed "The Vault," which sold in two live sales—one in Hong Kong and one in New York—to gross more than $12 million. (All figures are given in U.S. dollars.) Zachys' top lot of the year was a case of Domaine de la Romanée-Conti Romanée-Conti 1990, which sold in Hong Kong for $205,484.

For six of the past seven years, Chicago house Hart Davis Hart has dominated the domestic auction scene. In 2016, they posted U.S. sales of $47.9 million, topping their presale high estimate of $47 million. In addition, the firm achieved the industry’s highest sell-through rate: Not one of the 17,152 lots offered this year was passed. Popular consignments included Bordeaux-only and Burgundy-only sales. The house's top lot of 2016 featured three double magnums of Château Pétrus 1989 that sold for $65,725 against a high estimate of $55,000.

A common thread running through these successes? Bordeaux. Bonhams' global head of wine Richard Harvey says that a major talking point this season has been the renewed interest in classified Bordeaux. "Over the spring and summer, Bonhams sold a major collection of claret, originally bought en primeur, for more than $1.9 million," he said.

Frank Martell, Heritage Auctions director of fine and rare wine, agreed. "Bordeaux in general has been the most stable segment of all. The most important development has been in the 'super seconds' and value-grade châteaus," he said. "Inexpensive and extremely expensive Bordeaux both tend to be consistent performers. The wines in the $75 to $150 range are the true barometer for overall demand. We are seeing eight to 10 bidders on every lot, whereas for years there were only four to five."

Acker Merrall & Condit CEO John Kapon offered a slightly different take, reporting that Burgundy is the largest market segment of the house's $59 million total in 2016 (followed by Bordeaux and California wines).

"Domaine de la Romanée-Conti continues to hold the largest market share in terms of dollars," he said. That doesn't mean Bordeaux isn't selling. "The first-growths, along with Château Pétrus, all remained in our top 10 this year."

With the excitement of 2016 hinting at success for the coming year, specialists expect that Bordeaux will continue its resurgence. "As long as en primeur prices are relatively high compared to similar quality vintages that you can buy at auction," said Kapon, "this trend should continue."

Update: The original version of this report misstated Christie's Hong Kong sales, affecting the overall wine-auction market performance in Hong Kong, where sales declined 6.5 percent, not increased 6.1 percent. As a result, the global sales total did not show a slight increase, but rather a slight decrease. Acker Merrall & Condit was the leader in Hong Kong sales for 2016, not Christie's.

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