Phillips Auctioneers is planning to increase its headcount by about 40% as it moves into the largest office space among peers in Hong Kong, riding on record sales.
(Bloomberg) — Phillips Auctioneers is planning to increase its headcount by about 40% as it moves into the largest office space among peers in Hong Kong, riding on record sales.
The relatively young auction house is planning to boost its number of employees to more than 100 people in the city by the end of this year, up from its some-70 current staff, Phillips Asia chairman Jonathan Crockett said in an interview.
“This might be somewhat of an unusual time that we are living in right now because of inflation, because of the uncertainty of what to do, with what investments to put your money into,” Crockett said. “A lot of people are looking at collectibles, fine art, watches, jewelry as essentially as assets.”
Auction companies continue to expand in Hong Kong, even as many global financial firms assess their strategy for the city. Despite competition from Singapore and South Korea, Hong Kong is seen by the industry as a long-term dominant player in the art market, partly due to its strong shipping, warehousing and high-security storage services.
Phillips, which is owned by Mercury Group — one of the largest distributors of luxury goods in Russia — will move from Hong Kong’s Central district to a 52,000 square foot (4,831 square meter), six-storey space in West Kowloon Cultural District. That will make it the first auction house in Hong Kong to have a permanent purpose-built exhibition space, cafe and a VIP lounge among other facilities.
The company has only been in Hong Kong for eight years, compared with Sotheby’s, which had its first auction in the city in 1973, and Christie’s in 1986.
All three are aggressively expanding real estate in Hong Kong amid record sales. Christie’s will move to a 50,000 square foot space in The Henderson on Murray Road in 2024. Sotheby’s will open new spaces totaling 60,000 square foot next year, including an exhibition space in Central.
That said, the art market dealt with a series of risks last year, including an economic slowdown and campaign to narrow the wealth gap in mainland China. Hong Kong is also still recovering from years of strict pandemic restrictions.
“In the short term, we may see less activity coming out of the mainland itself, but even at the end of last year, we had significant mainland Chinese activity,” said Crockett. There are also Chinese citizens who have moved to Hong Kong and Singapore and contributed to sales, he added.
The auction house had a record $1.3 billion in sales last year, of which 34% were from clients in Asia. About 40% of those consumers were millennial collectors.
Nearly 70% of its business in Asia came from the Greater China region, Crockett said.
“I don’t believe there is another alternative to Hong Kong as far as what we do as a business,” said Crockett. “There is nowhere else we can be.”
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