Oliver's Twist | All quiet at Gresham's auction house in Hong Kong, a year after its debut

Not much is going on these days at Gresham’s Ltd, the auction house in Ap Lei Chau which garnered a lot of local press coverage during its debut last spring. There are no events slated for this year on the auctioneer’s website. In fact, references to a rare and fine wine sale back in September are said to be “upcoming”. On another page, an interiors sale scheduled for October still dominates the agenda. Meanwhile, the listed contact phone number is disconnected. Emails sent to an “info” address bounce back as rejected by the server of the recipient domain. All signs seem to point to the demise of Gresham’s, although it’s hard to be sure without speaking to Stephen Freeman, the U.S. founder of the auction house, and better known as a co-owner of HK Magazine before it was sold to the SCMP last year. What’s unfolding probably isn’t what Freeman had in mind when he forecast last year that Hong Kong was turning into the world’s No. 3 hub for art and antique auctions, trailing New York and London. Tracking down Freeman for comment, however, isn’t easy. A former colleague of his at HK Magazine wasn’t able to shed any light on his whereabouts or even contact details on how to reach the long-time Hong Kong resident. In an effort to contact Freeman, this column also reached out to a former editor of HK Magazine, a local gallery owner who did the interior design scheme for Gresham’s 6,000 square foot showroom near Horizon Plaza, as well as a co-founder of Asia City Media Group now living in Bangkok. None of these individuals were much help in providing clues, although the interior designer indicated that Gresham’s had ceased operating. Emails to Freeman’s social media accounts didn’t receive a response. While the local press has been strangely quiet about what was a much-hyped venture a half year ago, expect to see some wry play on “Gresham’s Law”, if the story comes back into the limelight. According to the auction house’s website, its name was inspired by Sir Thomas Gresham, the 16th century English financier who among other things, was the founder of the Royal Exchange and an adviser to wealthy individuals on the follies of monetary debasement. Sir Gresham’s lasting contribution to modern economic thinking is likely the “law” that bears his name and which helps explain why good coinage tends to be hoarded, while coins stripped of their gold and silver tend to remain in circulation. The theory is linked to the idea that bad money drives out good, and that the state should avoid meddling with a currency. It’s not spelled out why Sir Gresham inspired the name for the auction house. The website, however, plays up the idea that he was frequently in the company of European royalty. In a departure from the high-end auction market dominated by groups such as Christie’s and Sotheby’s, Gresham’s was targeted towards the “middle market” buyer in search of art, furniture and other collectibles. The model would have been a first for Hong Kong, according to Freeman. He touted the local markets for art and collectibles as “exploding and growing at a very rapid pace.” Wealthy mainland buyers, the arrival of international art galleries, and growing interest in contemporary mainland Chinese artists were helping fuel the trend, he said. In hindsight, some of that enthusiasm looks misplaced, with Gresham’s apparently suffering a reality check that not all things tagged to the growth of the mainland consumers are golden. It’s not clear how much was invested in the venture, or whether any outside investors were invited to participate. Freeman’s seemingly low key departure from Hong Kong, a city’s that had been his home for several decades, hasn’t done much to quell speculation that some people are upset. The demise of an auction house like Greshams, however, isn’t all that unusual. As many as a dozen commercial art galleries have folded in recent months. Other anecdotes tell of experienced China art dealers throwing in the towel to return to Europe after many years in Hong Kong. Many are facing the squeeze from rising rents and other costs. French bank Societe Generale noted last month that Hong Kong is the world’s most expensive office property market globally. Annual rents at the corporate level average US$1.63 million, placing Hong Kong well ahead of Tokyo at US$1 million. Meanwhile, Sotheby’s and Christie’s, beneficiaries of the global liquidity that’s helped push high-end art prices into the stratosphere, tend to keep their local costs down by flying in staff from overseas when hosting an event. Another factor might be that money isn’t circulating down to the mid market. Record prices fetched at auction – which typically dominates newspaper headlines at springtime - can be misleading. More often than not, that money flows into the hands of a collector rather than living artists. Another art expert doubted whether the local market for fine wine, antique Persian rugs and contemporary Chinese painting is really big enough to keep a mid-tier concept like Gresham’s afloat. The exit of Schoeni Gallery after many years in the city is another reminder. In explaining why she was suspending operations at the gallery started by father, Nicole Schoeni said she was seeking a sabbatical and planned to get married. Curbs on banker bonuses are another factor that has put a damper of sales, according to gallery owners. Still, by some accounts the local art scene isn’t doing too badly. Adriana Alveraz-Nichol, who runs the Puerto Roja Gallery, says the growing number of galleries along major pedestrian ways and doting the side streets in Central and Sheung Wan are signs of an vibrant market. An industry association of gallery owners has seen its membership jump to around 50, or about three times what it was a decade ago. Perhaps the global liquidity that helped push city’s real estate to records is trickling down to an art-buying level. Let’s hope it lasts. For Freeman, and anyone that piled into his auction house foray, time appears to have ran out. chris.oliver@scmp.com