How to Build a $60 Million Art Trove While Staying Within Your Means

(Bloomberg) -- When Heinz and Ruthe Eppler began buying modern art in the late 1970s, the rookie collectors took the advice of a local museum curator: Buy the best works you can afford.

It turned out to be a good investment strategy.

A group of 27 paintings, sculptures, and works on paper owned by the couple is expected to sell at Christie's in November for more than $60 million; the Epplers paid a fraction of that assembling the collection. It's one of the largest by value in the next round of bellwether art auctions in New York. The highlights, works by Pablo Picasso, Willem de Kooning, and Franz Kline, will go on view in Hong Kong on Sept. 28.

“It's a time capsule,” says Brett Gorvy, Christie's former chairman and international head of postwar and contemporary art. Gorvy has advised the family since Heinz's death in 2012. Rather than following the latest collecting fad, the Epplers “bought to live with the works and love them as part of their family home,” Gorvy says. 

A monumental black-and-white canvas by Kline greeted visitors in the Epplers' three-bedroom oceanfront condominium in Palm Beach, Fla. Paintings by de Kooning and Jackson Pollock hung nearby. A kaleidoscopic oil and paper collage by Lee Krasner, made of torn-up Pollock drawings, was tucked away in a bedroom.

The Epplers began collecting  just as Heinz's specialty retail business, the Miller-Wohl Co., was reporting outstanding profits following a Chapter 11 restructuring. One of the first paintings the couple bought, paying $162,000, was Picasso's muted wartime portrait of Dora Maar. The work is expected to sell for an estimated $4 million to $6 million at Christie's impressionist and modern art evening sale on Nov. 13.

Unlike today's megacollectors who store art in high-security free ports or tax-friendly private museums, the Epplers bought just enough works to fill the walls of their homes: one or two by each artist, with the focus on abstract expressionism. To select the best examples, they befriended Edward Henning, then the chief curator of modern art at the Cleveland Museum of Art.

“Ruthe and I are very patient collectors and are not impulsive with respect to acquiring a specific rare work from an existing collection,” Eppler told Henning in a 1982 letter.

They spent years looking for just the right Kline painting, eventually paying $900,000—a steep price in 1985—for an 8-foot-tall canvas by the master of muscular black strokes on white ground. The 1960 piece, Light Mechanic, is now estimated at $20 million by Christie's.

Their biggest purchases were in the mid-1980s, about the time that Eppler, whose family fled from Nazi Germany to the U.S. just before the Kristallnacht in 1938, sold Miller-Wohl for $270 million. In 1984 the couple bought an 8-foot-tall David Smith sculpture for $552,000; it's estimated to sell for $5 million to $7 million.

Christie's representatives are quick to point out that the Eppler collection is the first major abstract expressionist group since the auction of the David Pincus estate in 2012. Thirteen works from that trove tallied $175 million, with a Rothko surging to $86.9 million and a Pollock fetching $23 million. 

The Eppler group may seem more modest—there's no Rothko, for instance (the couple sold theirs before the financial crisis), and their Pollock has a top estimate of only $5.5 million. But as great abstract expressionist works become increasingly scarce with each passing year, auction houses are hungry for solid collections that have been tucked away for decades. Christie's, which had to fight off Sotheby's and Phillips to win the collection, offered the Eppler family members a guaranteed minimum price.

“It's exciting to offer things that have never been sold at auction before or have been in the market before,” says Sara Friedlander, head of Christie's postwar and contemporary art department in New York. 

A deft Arshile Gorky drawing, Composition I (1943), purchased from the influential Allan Stone Gallery in 1984, is estimated at $2 million to $3 million and could set a record for work on paper by the artist.

The collection also “allows us to tell a new story about American abstraction,” Friedlander says. “It's our job to bring to the market stellar examples by artists who may have been overlooked by the market in the past decade.”

William Baziotes, an American of Greek descent who died in 1963, could be one such person. His lush abstract canvas Phantasm is estimated at $600,000 to $800,000. The auction record of $385,000 for a Baziotes hasn't been smashed since 1990.

To contact the author of this story: Katya Kazakina in New York at kkazakina@bloomberg.net.

To contact the editor responsible for this story: Justin Ocean at jocean1@bloomberg.net.