Sotheby’s Re-Entry Into Korea’s Auction Market Begins

There is currently a vibration in the Korean auction industry that will cause major changes. At the epicenter is Sotheby’s, a major global auction house. Sotheby’s has officially announced its re-entry into Korea amid negotiations with Seoul Auction, Korea’s leading auction house. The Korean art and auction industry is paying keen attention to this move.

On March 8, 2023, Sotheby’s released a video titled “50 Years New in Asia: A Legacy of Five Decades and a Vision for the Future.” This video describes the company’s process and future vision, from the opening of Sotheby’s Hong Kong office in the 1970s until now. In the process, it announced the opening of a new office in Korea along with its strategy to expand Asian customers. However, the timing of the opening of the Korean office was not disclosed.

Sotheby’s, which has been pushing for the opening of its Korean office since last year, has appointed Jane Yoon, who served as the CEO of Phillips’ Korean office, as its new representative and is preparing to open it by recruiting more workers. There is a reason why Sotheby’s move is drawing attention. Sotheby’s entered Korea in 1990 but withdrew in 1996 because the market was not ripe, contrary to expectations. Since then, Phillips opened an office in Korea in 2018, and Christie’s has maintained an office in Korea since 1995.

Behind Sotheby’s re-entry into Korea is the rapid growth of the Korean art market. Throughout the COVID-19 period, the Korean art market has grown significantly. The Ministry of Culture, Sports and Tourism said that last year the Korean art market surpassed the KRW 1 trillion (USD 770 million) mark for the first time in history. In September last year, Frieze, one of the world’s top three art fairs, chose Seoul for the first time in Asia, and Seoul is one of the leading candidates for the Asian art market hub in line with the political situation in Hong Kong. The Art Basel Report once pointed to Korea as one of the countries with steep growth in new collectors.

An art industry official said, “It is important that Sotheby’s withdrew from Korea more than 20 years ago and returned again,” adding, “Sotheby’s must have been paying attention to the significant growth of the Korean culture and arts market, led by K-Pop, and the ‘Frieze Seoul’ boom last year.” He also added, “In the long run, Seoul is drawing attention as an Asian art market hub that will succeed Hong Kong and Tokyo.”

France’s Art Price, an art market information analysis company, identified Korea’s auction sales as the ninth largest in the world in a recent report. This is the third time in Asia after China (2nd) and Japan (7th). It is also a point of attention that the MZ generation (Millennials and Generation Z) is very interested in art and auctions. With the opening of new auction markets such as online auctions and non-fungible tokens (NFTs), young Koreans who are interested in asset growth are participating in or showing interest in the auction world.

The acquisition of Seoul Auction, which was put up for sale, is also drawing keen attention from the Korean art community. With Shinsegae Department Store recently giving up its acquisition of Seoul Auction, Sotheby’s and Seoul Auction are negotiating for the acquisition. Although there have been confirmed reports through some media, Seoul Auction explained, “We have considered selling the stake, but nothing is currently going on.”

Amid conflicting prospects over the acquisition of Seoul Auction, Sotheby’s move is expected to continue to draw attention. Some believe Sotheby’s acquisition of Seoul Auction is not very profitable, while others weigh the possibility that Sotheby’s and Seoul Auction will find a negotiating point. Analysts say that the interests of the two companies may match. Sotheby’s has announced its re-entry with interest in Korea as a new market, and Seoul Auction is already burdensome to sell and collect again. In particular, Chairman Lee Ho-jae, the largest shareholder of Seoul Auction, recently said, “In order for the market to grow, large capital must be brought in,” adding, “We are looking for a win-win way (with Sotheby’s) rather than rushing (negotiations).” 

As a result, negotiations will take time, but there is a possibility that the sale will be made. “Auction is a business that eventually induces collectors to trade their works at high prices,” an art industry official said. “Sotheby’s entry into Korea will naturally help not only auction but also grow the Korean art market.”

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