A NEW PERSPECTIVE
IMPORTANT INFORMATION FOR ALL WATCH COLLECTORS AND INVESTORS
By JAMES H.WOLF
On December 2, 1999 Sotheby's held
an auction in New York entitled "Masterpieces
From The Time Museum." The eighty-one pieces in the auction were collected by Seth G. Atwood and were formerly kept at the Time Museum in Rockford, IL. The collection consisted of early astrolabes, pocket chronometers and coach watches, as well as watches by Abraham-Louis Breguet, enameled pocket watches, early watches, and Austrian, Japanese, and English clocks. The premier item in the auction was the Henry Graves super complicated Patek Philippe pocket watch which was listed as lot number 7. The auction began with the presentation of the astrolabes and early scientific instruments such as a 1550s compendium and a star-form polyhedral dial. An amazing trend was starting to show!
The first six lots carried a pre-auction estimate which totaled approximately one million dollars; yet combined, the six pieces brought over 1.8 million. The results seemed strong and now it was time to auction the Graves Patek Philippe. This amazing timepiece was estimated to bring 3 to 5 million dollars. When the
dust settled, the watch sold for an unbelievable 11 million dollars! Wow! Numbers like that seem to get everyone's attention, but the dealers, collectors, investors and auction staff were still not sure if this show of millions was due to the rarity of the Patek or if the fun was just beginning.
Lots 8 through 44 were wonderful pocket watches. This section in the auction consisted of several gold pocket chronometers from the 1780 to 1820 period, a minute tourbillion by Paul Ditisheim, and works by Breguet including repeaters, a tourbillon, a moonphase and the Duc d' Orleans sympathique clock and watch. The sympathique was created in 1835. This wonderful masterpiece combines a red boulle quarter-striking clock with a half-quarter repeating pocket watch. At the top of the clock, there is a cradle or holder where the pocket watch is placed when not in use. At three o'clock in the morning, the pocket watch is automatically wound, regulated and set to the proper time by the "Sympathique" mechanism located in the clock. This masterpiece was estimated at one to 1.5 million dollars, but it brought an amazing sum of $5,777,500!
The watch section was rounded out with several wonderful enamel watches and early examples by Tompion and Ellicott. The thirty-eight pocket watches (lots 7 - 44) were estimated to bring just under seven million dollars (this figure is based on an average of the high and low Sotheby's estimates).
A few years ago, this estimate of seven million would seem to be right in line, but something new was happening at this auction. With a new millennium just a few weeks away, this lot sold for an astonishing total of over 19.8 million dollars! Unbelievable! This was not a number anyone expected; the pocket watch lots were nearly triple the pre-auction estimates. With everyone still trying to fathom these new price levels, the auction continued and lots 45 through 81 offered some magnificent clocks. When all was said and done, the auction which was estimated to bring 11 million dollars actually
brought a total of $28,285,050!!!
Now it is time to absorb what just took place and take a long look at this current market with hopes of seeing the future of watches as a collectible investment a little more clearly.
There are several factors which seem to be coming together and changing the high-end watch market. The main influences are:
1. The internet and recent communication advances.
2. A new wealth level and economic stability.
3. A revision of watch values as serious investments.
4. The rapid decrease of availability of fine watches.
5. A lack of modern day products with future collectible potential.
The internet explosion has led to a massive broadening of the client base for auction houses and watch dealers. Prior to this new worldwide web of information, the dealers, traders and auctioneers had to rely on mail, phone and, just recently, faxes as the primary means of presenting watches to potential buyers. Collectors, on the other hand, were also limited in terms of how much material they could view and consider for purchase. Traveling to shows, watching auction catalogs and mail listings were the main marketing devices used in the trade, but now a watch can be presented worldwide to a massive number of collectors and buyers with the power of the web. This new technology has already had a major impact in the collectors' market and new improvements will only magnify and enhance the way we buy and sell in the future.
Another factor to consider is that the watch market has never been truly organized as to the numbers of specific types of watches which are in existence. With the new technology, it is only a matter of time before the collectors and dealers pool their information and the true numbers of existing types of watches becomes organized and verified on a worldwide scale. This information could have a major effect on future price levels, especially when it comes to the very rare pieces.
The new millennium has also opened with very strong economic growth, and a large number of financially successful people are now entering the collectors' market for the first time. The "new buyers" are eager to invest some of the profits which were made in the stock market in collectibles and other hard assets. Watches are a popular choice for many of these new investors. Previous to this decade, most of the high-end pieces in the various "collectible" fields such as art, watches, jewelry, silver, etc. were sought-after and bought by the affluent people with what is referred to as "old money." The families of wealth which were well established for generations were often the prime players when fine items reached the auction block. In other words, the competition was much lighter then as compared to the present. The globalization of the world's economy is also leveling the playing field as this new millennium unfolds.
As shown by the phenomenal results that the Time Museum action realized, it is easy to see that the price levels of fine watches were long overdue for an adjustment. The rarity of these fine watches is now being seen in a clear manner. If you look at the larger picture, it becomes evident that the new upswing in watch values may only be the starting point; future increases are certain. During the 1950s, complicated and sophisticated timepieces became more desirable worldwide. This was mainly due to a major reduction in the number of these wonderful horological items being produced.
The number of watch collectors over the next twenty years (1950 - 1970) was very small, but growing at a slow, steady rate. Through the 1970s, the pace quickened and then the early inflationary 80s arrived. The collectors' base for fine watches was firmly established. Wonderful watches of all types were available in the early 1980s and the prices rose with the demand. The unknown factor of how many fine watches were actually in the hands of the public was not a concerning issue at that time since the supply of better watches seemed to be strong. As the next twenty years passed, a trend started to emerge. The supply of watches was indeed limited, and dealers felt the impact more and more as merchandise became harder to find. Price levels from 1980 to the late 1990s rose slowly and at a fairly steady rate, but as the last few years have shown, the supply was overestimated and the demand has not weakened for fine watches.
The society of collectors now has a controlling position, since the vast majority of better timepieces are held in established collections by private individuals, not by dealers or the general public. Also, when you research the price levels of other collector items such as art, jewelry, furniture, Americana, silver etc., it becomes evident that the prices of watches during the 1980s and 90s should have strengthened much more than they did.
The last few years have seen an increase in the production of high-end, high-priced watches. These are often made in "limited editions" which is a great marketing device geared to give the product an instant collectibility. This new watch market is driven by many of the same motivations as the antique or vintage watch collectors' market. One reason behind the success of this new market is the simple rarity of the true antique and vintage pieces. The limited production and high-end watches now being produced may gain collector status in years to come; yet when you compare all of the factors which determine true value, the older vintage pieces are unsurpassed. Early 17th and 18th century watches, fine enamels, complicated timepieces by masters like Patek Philippe, Jules Jurgensen, Adolf Lange, and rare American watches are truly the best and most impressive watches which will ever be made. Man's fascination with time will never end, and this wonderful field for collectors and investors will flourish as surely as the passage of time itself.
James H. Wolf: Associated with Ashland Investments since 1980, Mr. Wolf is an active dealer specializing in pocket watches, vintage wristwatches and antique jewelry. Founded in 1963, Ashland is owned by Richard E. Gilbert, and this international mail order firm has been the leading supplier of collectible watches and jewelry. Jim Wolf and Richard Gilbert are coauthors of "Complete Price Guide to Antique Jewelry" and Mr. Gilbert is also an author of "Complete Price Guide to Watches."