Rapaport Magazine

Dragon Market

While holiday jewelry sales slipped in Asia, increases in the U.S. contributed to a solid season overall.

By Ettagale Blauer
Few places demonstrate the dramatic shifts in the world’s economy better than Hong Kong. This former British Crown Colony began to emerge as a unique venue for jewelry auctions in the 1990s, mainly as a public salesroom for fine jadeite jewelry. The explosive increase of wealth in the region, notably in Malaysia, has provided a prime geographic growth sector for Sotheby’s and Christie’s Hong Kong auction houses. But both showed tremendous prescience in committing to and cultivating this market well before the dramatic increase in moneyed investors in the region could have been foreseen.
   The appearance on the auction scene of two Asian tigers, Chin Yeow Quek and Vickie Sek, in the late 1990s, propelled Hong Kong to a prominent position on the international jewelry circuit. Within a remarkably short time, the two auction house executives began setting global auction records from this brand new outpost, even outpacing Geneva, the traditional leader in jewelry sales at auction. Capitalizing on their gemological, linguistic and personal skills, Quek and Sek have catapulted Hong Kong auction sales to world-class status.

Chin Yeow Quek
   Quek began his meteoric rise in 1987, when he was named head of Sotheby’s Singapore office at the age of 29. In 1998, he became head of the firm’s Hong Kong jewelry department and he is now Deputy Chairman of Sotheby’s Asia as well as Chairman of International Jewelry, Asia. He is also the firm’s principal auctioneer in Hong Kong. He has overseen the rise of the department’s stature in international auction circles with world-record sales of a jadeite necklace and a 118.28-carat D flawless diamond. Quek speaks Mandarin, Cantonese and English — sales are conducted in all three languages — plus Bahasa, the language of Indonesia. Language proficiency is crucial when appealing to a broad range of pan-Asian and Western cultures.
   “Buying jewelry at auction was a relatively novel concept in Asia back in the 1980s and 1990s,” Quek explains. “We made an effort to demystify the idea of auction, then shrouded in intimidating misconceptions.” Sotheby’s was established in Hong Kong in 1973, initially focusing primarily on jadeite jewelry, the widely preferred gemstone in the region. This appealed to the local Asian audience, which was focused on Chinese works of art at the time. Customers who came shopping for art stayed to look at, and bid on, jadeite jewelry.
   “In the 1980s,” Quek goes on to say, “Sotheby’s started to see increasing Asian participation in our sales in Geneva and New York, which were mostly focused on diamonds and colored stones.” This led the firm to create its first “Western” jewelry sale in Hong Kong in 1995. That sale, which featured a Harry Winston necklace on the catalog cover, marked a dramatic move into a totally new type of jewelry for this audience.
   The Asian market was quick to pick up on the fun of bidding at auction, “as opposed to the instant purchase at printed prices with discounts that they were used to,” continues Quek. Hong Kong jewelry sales “currently account for roughly one-third of Sotheby’s jewelry auction sales total,” adds Quek. Unlike the traditional market for diamond jewelry, he adds, “a noticeable change is that compared to 20 years ago, the median age for buyers is considerably younger now.”
   Initially, Hong Kong–based auctions featured a balance of 60 percent jadeite and 40 percent Western-style jewelry, whereas now, Quek says, the mix in Asia is typically 30 percent to 40 percent jadeite. And, he notes, in the past two years, the Hong Kong salesroom has seen auction records set for white diamond, fancy vivid pink diamond, ruby and per-carat price of sapphire and jadeite. “Our Hong Kong sales are curated to be smaller than our counterpart auctions in Geneva and New York, but generally with a higher per-lot value.” With global economies constantly fluctuating, Quek says, “as long as the various Asian economies do well in the short- and medium-term, the jewelry auction market here can be expected to project growth.”

Vickie Sek
   Sek started out as a diamond sorter in Hong Kong, soon advancing to manage a fine jewelry store there in 1977. She joined Christie’s as a jewelry specialist in 1994 and has brought her department, based in Hong Kong, global recognition and status. Under her guidance, Christie’s has broken numerous records for auction sales totals in Hong Kong and for gemstone prices, including the 2008 sale of a 101.27-carat diamond. Like Quek, she speaks English, Cantonese and Mandarin and she also is fluent in Japanese. Sek is known for her extensive professional contacts and reputation throughout both the European and American trade, as well as with the all-important private clients.
   Christie’s first Hong Kong jewelry auction was held in 1993. “To Asians,” Sek recalls, “auctions were a new and fresh concept.” While they were more accustomed to buying at retail, “they also found auctions very intriguing. Clients were fascinated with the influx of unique Western jewelry we were able to source and place at auction.” The Hong Kong region was ripe for the expertise the auction houses brought, particularly, Sek says, “our ability to source rare and unique Western jewelry for our clients at a time when there was such intense craving for something different and special. The appetite for collectible, unique jewelry and stones is huge.”
   Sek worked to nurture and educate the market’s appreciation of the nuances of Western jewelry. “There was a furor and enthusiasm that defined the mood and attitude that people had toward Christie’s. This ultimately drove our jewelry sales from a meager $2 million to the current $100 million.”
   As for the future of the Hong Kong market, Sek says, “There has been a focus of attention by the auction industry on the Mainland China market in recent years. This is predominantly due to the Chinese people’s hunger for luxurious items and is in many ways fueled by their feverish passion for acquiring fine art and other objects of value. In the newly emerged market with the newly built fortune there, most collectors are looking for diversity and a good investment for their money.”
   Given the recent slowing in growth of the enormous Chinese economy — still at a healthy 7 percent rate but a far cry from the double-digit rates that characterized the past three decades — there are concerns around the world about the impact on auction totals. Sek, however, points to the astonishing totals achieved in recent Christie’s Hong Kong jewelry sales as an indicator of future growth. “In our Autumn 2013 sale, we achieved our highest total of $110 million, and a driving force was the growing China market. Despite the slowing Chinese economy, our November 2014 sale still made $95 million. This shows that we don’t rely on one specific market. As long as we continue providing our clients with rare and top-quality items, our reach will still be quite international.”

Article from the Rapaport Magazine - March 2015. To subscribe click here.

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