House, led by former hotel executive, leads nation's big market

China in recent years has been gaining ground on the West in the number of art collectors. The United States and Europe no longer dominate the international art and antiques market.

"With the growing middle class and wealthy people coming out of China, the Chinese auction market is fast catching up with its foreign counterparts, and it is just starting," says Wang Yannan, director and president of Beijing-based China Guardian Auctions, the nation's oldest auction house.

Experts say the turbulent stock market and cooling real estate investments in China have also contributed to the strong growth in art as an asset.

In 2011, China's share of the world art market was 30 percent, up from 23 percent in 2010, surpassing the US as the world's leading source of art and antiques buyers, according to a report by the European Fine Art Foundation.

The report, compiled by Clare McAndrew, an economist and founder of consulting firm Arts Economics, called the development "one of the most fundamental and important changes in the last 50 years".

The United Kingdom, which was overtaken by China in 2010, remained third with a 22 percent art-market share while France was fourth with 6 percent.

Wang, a former senior executive at the Great Wall Sheraton Hotel in Beijing, has led China Guardian since its formation in 1993. The auction house ranked second with a revenue of $1.8 billion last year, after the Beijing Poly International Auction's $1.9 billion.

"It was by accident for me to move to a completely different field from hotel management. I found (auctioneering) interesting and thought I'd give it a try," says Wang, sitting in China Guardian's new office on Manhattan's Park Avenue.

Even with the new office and her frequent travel between New York and Beijing, Wang says the trips to the US serve only the purpose of "looking and learning and making connections" in the more established art and auction market.

"Our clients are based in China, and we want to serve that market well. Meantime, we want to 'walk steadily', and earn and maintain our reputation instead of chasing after huge profits," she says.

China Guardian has conducted more than 300 auctions, selling more than 200,000 items that include Chinese paintings, calligraphy, porcelain, ceramics, sculpture and fine jewelry. The auction house stages six spring and fall auctions each year.

Traditional Chinese art, such as paintings and calligraphy, furniture and porcelain items, accounts for more than 70 percent of the company's auction revenue.

Among turnover from last year, Chinese paintings and calligraphy took about 66 percent (or $1.2 billion) of the $1.8 billion total, China Guardian's highest record since the category was established.

Painter Qi Baishi's Eagle Standing on Pine Tree; Four-Character Couplet in Seal Script was sold for about $68 million, making it the highest price for a piece of Chinese art in 2011 for China Guardian.

Wang doesn't expect this year's turnover to exceed that. She regards "stable and healthy growth" as more important for the company's long term.

According to Artprice, a French provider of art market information, two Chinese ink painters Zhang Daqian (1899-1983) and Qi Baishi (1864-1957) topped the annual ranking of auction revenue globally. Their respective $530 million and $465 million surpassed Western artists such as Pablo Picasso.

Wang says in this year's spring auction, in early May, China Guardian will launch an ink-character-painting session and a China Red classic painting, Revolutionary Ideals Higher than Heaven (featuring Chairman Mao in the Long March), by contemporary artist Shen Yaoyi.

As Western collectors get more into Chinese art, their counterparts have begun expanding their interests, too.

"Chinese collectors' tastes are growing beyond Chinese traditional artworks these years," says Wang, adding that Western clocks are a new category that has drawn Chinese investors' attention.

Even though Chinese auction houses like China Guardian are growing, the global market is still dominated by long-established Sotheby's and Christie's, which sometimes auction Chinese art.

Wang says the whole market is big enough for all players, and "each has its own expertise".

"How we can stand out is probably expertise in art identification in Chinese artworks in particular," she says of China Guardian. "After all, what collectors don't want is to get counterfeits."

Wang says China's art market received more attention and support in 2011 and "became more rational and collectors were more mature". She adds: "It was a good sign that the China market will move forward and become more stable in the coming years."

Wang's philosophy in managing China Guardian is to maintain "quality and responsibility", avoid "greed", serve clients and be well recognized by others in the industry.

With the company approaching its 20th anniversary in 2013, it has been "doing well" in the past two decades.

But the fast-growing domestic art market in China also poses challenges for auction houses like China Guardian.

For instance, art funds have emerged to satisfy investors' demand for assets that they can hang on a wall or display in a case. The funds generally are privately owned and generate returns through the buying and selling of artwork.

Data show that China has more than 70 art funds. According to a Deloitte report, the combined market for Chinese art funds and art investment trusts exceeded $320 million in 2011.

Among the earliest was a fund launched by China Minsheng Banking Corp, the country's first privately owned bank, in June 2007. Minsheng says returns of the fund were up to 25 percent in 2010.

But experts say such a heavy influx of capital into the art market could lead to price bubbles and excessive speculation.

Wang wants her company to position itself to maintain "healthy growth" even as the market expands and new dynamics emerge.

"As new elements come into the art market in China, the structure of the market changes accordingly," she says. "These new investors don't necessarily know enough about the art market; it then becomes a new challenge to work out how to guide them and make sure the new elements join the market harmoniously."

yuweizhang@chinadailyusa.com