There will be no further Bonhams whisky auctions in New York for the foreseeable future. The auction house has canceled its planned sale for October 19th at its Madison Avenue galleries and will review the situation on scheduling further auctions next year.
Mariam Cebalo, director of business management at Bonhams confirmed to Whisky Advocate that the cessation of operations in this area was solely due to the whisky department’s profitability. In other words, the department may not have hit the targets set by the company to justify the resource required to appraise, catalog, store, display, and ultimately auction large consignments of rare whisky. Whisky auction houses must partner up with a retailer holding a liquor license, and that comes at a cost to the operation.
Therefore, this decision is not a reason to doubt the inherent value of whisky as a collectible or affect confidence in the secondary market. From the business perspective of an auction house, it is simply the commercial nature of whisky as a tradable commodity when compared with other assets in the New York saleroom. “The market is especially strong right now for Asian art, Californian and American paintings, jewelry, and motorcars,” Cebalo told me.
The legislation preventing whisky auctions in New York was overturned seven years ago. Christie’s held the first sale in December 2007 and Bonhams entered the fray in 2009. In recent years, Bonhams have been running biannual rare whisky and spirits auctions in Manhattan, with the last sale held on April 30th 2014.
Importantly, Bonhams have confirmed that the whisky department in Queen Street, Edinburgh and at One Pacific Place, Hong Kong are unaffected by this news and their full program of whisky sales continues as advertised. Bonhams have been expanding their operations in Asia-Pacific with the opening of a new Singapore office. This means that the highly anticipated Bonhams Hong Kong Japanese & Rare Whisky sale will take still place on August 15th 2014, and the next Edinburgh sale will occur on 1st October 2014. However, that may be little consolation for whisky collectors in the United States and Canada.
The Bonhams business is currently up for sale by its two majority owners, so would the reinstatement of whisky auctions be at the discretion of any potential new owners? Would there be any market conditions to be met first? “Bonhams’ evaluation of whisky auction scheduling for 2015 is based solely upon profitability,” said Mariam Cebalo. So if you are thinking of consigning your whisky or bourbon collection for sale, should you still approach Bonhams, New York, I wondered? Cebalo replied affirmatively, “With its international expertise, Bonhams is well equipped and happy to appraise large, valuable collections and discuss consignments with interested parties.”
Where does this leave the whisky collector in the United States? Bonhams were the only auction house running fully dedicated whisky sales in New York, so will other auction houses capitalize on this opportunity? As a collector, who else could you speak to? I took a straw poll of leading U.S. fine wine auction specialists and this is what they told me.
Acker Merrall & Condit
“We will continue to welcome and offer and sell whiskey at our auctions in New York,” said John Kapon, chief executive officer of the global company well known for its fine wine auctions. “I doubt we will conduct a ‘spirits only’ auction, as it is a niche market.”
Christies, New York
“Christie’s, NY led the way with spirits sales many years ago, in the first spirits auction since Prohibition,” remarked Charles Antin, Christie’s head of sale, associate vice president and fine wine specialist. “Since, we have always offered smaller, curated selections of scotch, bourbon, cognac, and rum in our fine wine auctions. On October 10th, in fact, we have a large selection of scotch including Black Bowmore and others.”
Hart David Hart Wine Co., Chicago
“We feel there is certainly potential to expand the fine and rare spirits segment of our business,” said Marc Smoler, their marketing manager. “Spirits categories such as bourbon, chartreuse, and Japanese whisky have drastically increased in popularity in the past few years. Hart Davis Hart has done particularly well with small production bourbons such as Pappy Van Winkle and older vintages of classic single malt scotches.
“As our business continues to grow, we would like to offer more opportunities to purchase and fine and rare spirits through both our retail and auction outlets and we welcome any collector to sell their whiskey collection with us,” he continued. “However, we don’t foresee a whiskey-only auction in our future.”
Morrell & Company, New York
I spoke with Jeremy W. Noye, Morrell’s CEO.“We’re always willing to look and consider a collector’s selection of whiskies or spirits.” However, he doesn’t see a dedicated whisky sale on the cards quite yet. “I won’t count it out, I won’t say never, but we will continue to have whisky within our fine wine sales. There is an interest in the market in vintage spirits looking at the distillation dates of different whiskies, bourbons and cognacs. In general, we don’t seem to see as much of the older bottlings here in the U.S. as you see in the UK and Europe. I know there are major collections here in the U.S. but they tend to hold on to them for longer than they do with wine.”
Admittedly, it is harder for a business that doesn’t handle large amounts of rare whisky to appraise and value whisky bottles. “It is labor intensive from our standpoint,” says Noye. “It does take a fair amount of research. My gut tells me there is less of a breadth of knowledge, the historical look and feel [of the bottles], and data out there as there is on wine at this time.”
“I think there is interest there,” he said encouragingly. “It is spread out across the country and globally. At least in the U.S., the Pappy Van Winkle craze has really spoken to that. We’ve seen more bourbon coming up to auction now, even the general release stuff. It’s the scarcity aspect.”
Skinner, Inc., Boston
After running a dedicated online auction of fine ales last spring, Marie Keep, director of fine wines said, “We see great potential for growing the exciting and dynamic marketplace of whisky and spirits, and believe we could become the auction house of choice for collectors on both the buying and selling side.”
Sotheby’s, New York
Sotheby have been known for their occasional spectacular sales of Macallan. Their press office said, “We don’t currently hold regular dedicated sales of whisky and there are no plans to do so. We don’t rule out offering occasional rare bottles or collections in the future though.”
Wally’s Auctions, New York
“Wally’s absolutely welcomes whisky collectors to sell their collections (and buy!)” enthused Julia Gilbert, Managing Director. “We have had great success with highly curated sections of spirits in our March and June 2014 live auctions in New York, and we frequently receive inquiries about offering spirits at auction. As the whisky market continues to grow both domestically and globally, a dedicated whisky or spirits auction is certainly in the realm of possibility for Wally’s Auctions in the future.”
Bonhams continues to be a major player in the secondary market for rare whisky, but this snapshot indicates that choice abounds, and the landscape may have changed in the U.S. by the time Bonhams are ready to come back into the marketplace.