We’re thrilled to share an exclusive video segment from SoFLo Home Project that showcases our Florida showroom and features an insightful interview with our CEO, Jake Baer. Dive deep into the world of mid-century modern elegance as our CEO, Jake Baer, personally guides you through our iconic collection. From timeless designs to the rich histories behind each piece, Jake shares some of the most incredible furniture tales that define Newel’s legacy. Watch now and be inspired.
A Brief History of Victorian Furniture
Celebrating 80 Years of Antiques & Decorative Arts
Antiques, for an Evolving Buyer
Back in the day (the 20th Century), you either bought antiques and decorative arts at auction or from dealers spread throughout the US and Europe. Sourcing merchandise was easy but competitive, with a robust dealer/auction base and a consumer market bursting with demand. Anyone of means could open a shop and be a “dealer” of fine objects in any small or large city. A sense of taste, knowledge, and a little capital for inventory and a shop were the requisite requirements for success. Fast forward to the present and the necessities for survival have a completely different format.
The showroom and shop structure has gone the way of Amazon Prime. It’s not about scholarship and knowledge but design and trends. Passion and appreciation has taken a backseat to form, function, and availability. The need to have it now supersedes the thrill of the find and pursuit of the extraordinary. With these new parameters, the internet offers the only resource to cast the widest net in the need to find, value, and secure items of interest. That interest now fights with travel, food, entertainment, and technology among the many demands for one’s attention.
Interior design and the residential environment has morphed from a space of primacy to one of means to an end. When was the last time you entertained guests (not family) in a dining room; then again when was the last time you had dinner in your dining room? And the living room, does it have any function anymore? We live in a different reality where the home serves a different utility than in the traditional sense. Rooms have been redefined as to purpose and meaning, with an eye on a different approach to space, color, and light. Perhaps the view from the 45th floor takes precedent over the interior décor, or maybe it’s the architectural minimalism that sets the tone. Interior furnishings seem to take a secondary role, but that’s where there is opportunity for the decorative arts.
With the new availability of merchandise through the internet, the means for procurement of interesting items has never been easier. And in the scheme of pricing, there has been such a downdraft in prices over the last decade that overpaying is marginal. Yes, I overpaid for my Mercedes and I know someone got a better price than me, but so what. I’m driving a nice car and I enjoy it as much as the guy who made the better deal. Pricing antiques has a negotiable metric that should also equate to some form of satisfaction and pleasure beyond the cost.
The possibilities for antiques and the decorative arts in the home or office will continue to evolve. Methods of purchase will always be in a state of dynamic change and the internet will be that engine (what’s after 1stdibs). The touch and feel aspect has already made the leap into the digital world. The future demand for these items rests on a change in perception. Today, being a dealer or an auctioneer offers little cache to a sale. Antiques must solely rely on a change in taste and attitude. Everyone can and wants to live in an environment that defines their personality with furnishing that give some meaning and definition of that individual.
The Antiques Industry, Captured in Time
Anyone in the decorative arts and specifically the “antiques business” has been overwhelmed by the last decade’s collapse in pricing, glut of supply, and dearth of dealers to create a secondary market. Yes, Tiffany is holding its own and modern design is still testing its limits but the industry’s many other categories are faring on a different level than has ever been seen in this market’s new re-balancing. Pricing now is a much more elusive number that tests Adam Smith to his core.
Willing buyers and sellers balance price with knowledge. The knowledge is a critical component for gauging value, but the value can be altered by an emotional or visual reaction to the object; does it turn you on! The emotional connection and appreciation of the intrinsic quality of the item has an edge, at least for me. So why can’t the public at large want some of this stuff like I do; to live with and enjoy. That big $64,000 question is killing the business, and it is all because of how these items are perceived by the public, which does not include being functional, decorative, and moments in time.
Even a Jeff Koons sculpture will be dated, just like Picasso, or Rembrandt. Perhaps Contemporary Design will eternally evolve, with form and functions ever driving innovation. The only salvation for the antiques business is to promote its point in time as a period designed piece. By all (my) measures an eclectic mixture of decorative arts is the best interpretation of taste, style, and knowledge. Mixing French with bamboo or Mid-Century with Italian Neo-classic, adding in a little Rustic, it’s the individual pieces that have to compete for your eye. How much fun is that! Going to a museum and seeing these things can evoke feelings of fantasy and make believe, so why is it so difficult to make these items appealing to a market that is much bigger than when the industry was thriving 15 years ago?
It’s really all about how these items are marketed. I have yet to see a professionally created analysis of the hard core antiques business. Trends are one thing, but the generational destruction of the market cannot be blames on 1stdibs and its sort. The whole image of these items has been hollowed out to Antiques Roadshow pricing. Sentimental value will get you nothing, and that’s not the kind of value you need as a buyer. Buyers have given up on this stuff not because it’s not “contemporary” but because our items have lost their ability to attract any emotional interest. Buying some “disposable” Nike sneakers can get your blood flowing, a cool Art Nouveau bergère in any room would light it up.
The antiques business is unfortunately in a downward spiral because of a simple problem, we’ve lost our sense of time. Our potential consumers have other more pressing needs than a slow selective process which requires both time and your attention. Yet there is interest and something of a mystery about the pieces and how they got here. The potential is there in anyone who likes non-fiction and has a visual sense. We trade in the real, not make believe. We should turn the image of these items into owning a piece of time and place, with good modern design pieces, that will get old too. Creating a marketplace that will foster that kind of thinking is daunting but is the best option for a resurgence.
The Auction Duopoly, Dubious Dealers in Disguise
The headlines after the Sotheby’s $½ billion Taubman auction guarantee disaster was their new acquisition of the Art Agency, Partners (AAP). The firm is lead by a group of high powered art advisors who claim a leadership role in the high end of the fine arts market. Sotheby’s, is doubling downing on this segment of the market for their future growth. Of course there must not be any possibility of a bust in this inflated world.
What this new step by the new CEO, Tad Smith indicates to me is that their reliance on controlling their traditional auction methods is coming under undue pressure for profits and playing the dealer role is now the only viable option to growth. The crap shoot of guarantees and other manipulative methods is becoming more challenging to profits and the public’s perception of their integrity.
However, the ambiguous nature of these firms is highlighted by a comment by Mr. Smith that the acquisition gives them “new growth opportunities in advisory services and reinforcing the client-first culture in all what we do.” So who is their client and who are they working for, a buyer or seller; you can’t work for both without a conflict of interest, and an auctioneer by definition should be working for a seller. How do you reconcile this? Would the new AAP division advise a purchase at Christie’s, or possibly from a private dealer that stocks a certain artist that a collector is looking to acquire? Is that a client-first thought; I find that hard to believe.
Art Advising is fraught with conflict of interest and the professionals who work in this field are savvy, aggressive, and recognize opportunities as they arise. How they can operate within the auction process is dubious by any measure. Independent and unbiased perspectives of any consultant will always better serve the private individual seeking such services. Advising under the control of Sotheby’s is like asking a financial consultant who works for Chase Bank to recommend an investment fund outside one of its own financial products. Good luck!
However, like their successful track record shows, they do have the PR and image game down pat. You can always trust Sotheby’s or Christie’s because they are who they are, corporate, experienced, and nobody else can complete with them. So now we see that the future of companies like Sotheby’s is morphing into a consulting business and not the traditional role that auctioneers played as passive market makers. Stay tune for future conflicts of interest, deceptions, and of course fraud in the operations of this industry.
The Duopoly, Peaking or Will They Just Fade Away
I’m never bashful about my disdain for the Sotheby’s/Christie’s methods of deception and fraud, as they seem to be doing it quite successfully in spite of my rants against them. But as all things must adapt and change with the evolution of a dynamic environment, the world of the auctioneer and their methods is not going to be the same. Control via the economic power of a duopoly can cause the two parties complacency and rigidity in how they operate. That can lead to an inability to recognize that old methods can inhibit growth and creativity.
The evidence of this phenomenon is how this duopoly in the art and antiques industry has in a calculated way, jettisoned the decorative arts and many other niche markets where they fail to dominate or have successfully destroyed the vitality of the secondary market. Their unabashed push into the contemporary and 20th Century fine art market illustrates how single minded and reliant they have become on this lucrative and dominant market. Stamps, period furniture, collectibles, and so many other fields that they use to participate in are no longer on their radar. For them it is now a big bet or no bet at all, and contemporary/20th Century is where they want to be for that purpose.
The notion that markets only rise is a recipe for a disaster. The duopoly should know and remember what happened in the 1980s, with Impressionists Art and the Japanese buying bubble. However, the present environment presents a different challenge to their dominance and their vulnerability to market vagaries. Their sole method of success now relays on conflict of interest and deception to a retail clientele. Rich hedge fund billionaires and sovereign wealth funded individuals now dominate the upper strata of their marketing and promotion. Can the demand of that small but elite group keep up with a shrinking supply of high quality inventory; will this demand for contemporary perhaps move to other areas as valuations become unsustainable with limited product availability?
It seems to me that the Duopoly has painted itself into a corner. While they use to have a diverse portfolio of products their profitability is now more reliant on fewer. The lip service Sotheby’s is giving to alliances with the like of eBay make for a dilution of their brand and at minimal profitability. In addition, they both are clearly losing their top talent in those areas of the highest profitability and risk. Many of their former employees in the contemporary and 20th Century fine art departments have departed, realizing they can make more money as consultants with flexibility to operate outside the duopoly, than working for them.
The dramatic changes in the industry over the last 10-15 years will only accelerate. Sure, they will continue to promote themselves as the only go-to resource for the best of the best, but things are changing and nimble individuals and dealers will continue to make inroads as viable alternatives to their methods that center on having control of both buyer and seller. Within the time frame of the next decade, growth for this duopoly will only continue to be constrained by new competitive forces going after a limited supply of product. That product will find options that can compete with the constraints of how the Duopoly presently works.
The End of an Era on 53rd Street, Newel 1969-2015
Today is a seminal day in the history of Newel, a 4th generation family business. We have officially planned to not operate out of that location today, the first time since my first summer job working at Newel in 1969. With our original store in 1939 on 47th Street and Second Avenue, additional 49th Street locations, the 53rd Street building has had an incredible run for our success and survival; and how has the industry changed in the last 46 years?
My personal perspective on this special day is both saddened by the memories, but buoyed by the prospects and opportunities that now abound. Somehow the location was never really optimal for either selling or renting our stock. Packed in on 6 floors and in a Mid-town East “Siberia”, rarely did anyone ever “walk” to Newel? It was just out of the way and Sutton Place wasn’t exactly Times Square for a taste of New York City. Yes, it was residential, totally.
Of course when we first moved there it was a different time and place; the fine and decorative arts industry was dominated by dealers. When we took our first space in this location the New York Antiques Center, on the 1st floor was the largest in the City. It had entrances on 53rd Street and 54th, a city block long with a motley collection of dealers and activity. Unbeknown to most of those dealers and the buyers who frequented the Center, my grandfather warehoused his vast inventory on the 2nd floor, directly above it. I remember the expression of Peter Wilson, the esteemed English gentleman who positioned Sotheby’s to where it is today; how had this collection stayed under the radar?
It did because Newel focused on renting period pieces to the entertainment industry, simulating on the stage and in the movies and TV, sets that needed authenticity and not to those who bought for their own decorating or collecting purposes. That one specific purpose allowed the Company to never quite be a part of the antiques trade, and the dealers whose welfare was measured by buying and selling only. Oddly, about the time Newel consolidated it various warehouses into the 53rd Street location, the “hey-day” of the rental business had passed even though having a single location under one roof was finally achieved. It would take perhaps 30+ years for that part of the business to accelerate. Selling would need to supplement growth in revenue.
The 1980s and 1990s must be considered the “go-go” years for antiques and the decorative arts. Everything and everyone who participated in the market enjoyed an unfettered strong demand, across the board. Housewives could open a store with their first European buying trip, paying anything and selling for double and more. Mistakes were hard to make. We rode the wave too, but it all came crashing down after 9/11. The Millennium of the 21st Century changed what and how people want to buy, and it isn’t anything and everything that you offer, unless of course it was Mid-20th Century.
With that said, we had to hunker down to survive and had the good fortune of a rising TV and motion picture industry in New York City. Today we are enjoying the robust strength of the entertainment industry and the need for “content” in the many new mediums of entertainment and business. Also, as a design influence, Mid-Century isn’t what is use to be although it is now part of contemporary design that is starting to engage period pieces as distinctive and unique objects. This latest observation has brought Newel to a crossroads. We want to both sell and rent, but to do so successfully requires attention to both business models.
Today we set up shop to sell our items in a newly renovated showroom at 306 East 61st Street, joining other dealers to showcase and display what Newel is and has always been. Our Long Island City location houses the entire collection and is rental ready. We can supply period interiors for the fantasy of your own living room or simulating the White House for the TV show Madam Secretary. Now, with 2 dedicated locations, we can service both of our business sides.
Survival By Consolidation
One thing you can say about the dealer network, it is incredibly fragmented, to the point of total specialization and independent operation. While I like to think Newel is the antithesis of that domain, there are no Christie’s or Sotheby’s among them, except perhaps in specific, isolated fields. They did it by consolidating numerous specialty departments across a broad range of decorative and fine arts, along with jewelry and real estate. Their model is flawed by deception, fraud, and all the other manipulative techniques they employ but they got it all under one roof and they sold it to the public.
I like to think that the decorative and fine arts industry always had a pure form of economic functionality, with lots of buyers and sellers. A free and open market, as Adam Smith describes, creates a natural level of pricing, but that’s not how the real world work. Listening to Bloomberg radio in my car, it sounds like a broken record that consolidation is taking place in every industry. Oil producers and banks have been doing it for years, and your neighborhood store is now a franchise of a 7-Eleven or Wawa (I’m originally from the Philadelphia area). There really isn’t any industry that has not experienced some form of merging, alliance, or relationship that has permitted a few to dominate.
Why didn’t the decorative and fine arts evolve through consolidation like most industries have experienced. Chocolate companies, automobile manufacturer, and certainly technology companies all have a genesis of starting small and learned to growing. Sometimes it is internally done, but once a business reaches a critical size, they must move forward to protect their future and learn to control their industry. Whether a monopoly, duopoly, or several companies, having political clout becomes a necessary option. We know that has been the critical reason for the success of the felons, Sotheby’s and Christie’s; their boards can’t have enough of those types. But all they have done is take a lesson from any successful company who employ lobbyists and influence.
So why has my industry been the only one that operates by the (flawed) auction method and not by a free open market? After all Exxon can’t make oil sell for $100 a gallon when the market has it at $55, but they still dominate. The free market does work when micro-chips are considered a commodity and priced that way. The big difference is that in theory, the auction business doesn’t have ownership of the inventory. Now you irrevocable bidders may disagree, but that’s another story of fraud and deception in the auction business. Every other industry strives for efficiencies of scale. In my industry, it would a, should a, could a, but it never happened.
The dealer model presently does not have any significant impact on pricing at the auction level. The flow of inventory is too slow to use the auction format as a resupply source, as was the case decades ago. The decimation of the secondary market is reflected in the dearth of dealers who use to participate to support it. Only efficiencies created by economies of scale will dealers of any consequence survive and even thrive.
This week, we are taking over another established dealer and again are expanding our inventory’s scope. We see the hand writing on the wall with the idea that larger is better and only the strongest can endure changes in the market. The last 15 years has seen a seminal alteration in dealer survivability; we’ve survived by getting bigger and the opportunities to grow are becoming more apparent.
A New Path for Newel
With a foundation that was totally different than any other decorative arts dealer, Newel is about to experience a new and auspicious future. The present state of the industry is dicey at best, but as my grandfather who founded Newel would say, success is when “opportunity meets preparation.” Newel is now officially unshackled from its location at 425 East 53rd Street for the first time since 1969. It was a phenomenal run for four generations of the family (it all started on 2nd Ave. and 47th Street in 1939) but now is the time for a new chapter. A massive Long Island City warehouse and new showroom on East 61st Street will pivot us in a different direction.
The location of our building in New York City, a commercially zoned warehouse in a highly residential neighborhood, was difficult to attract clients to visit. It didn’t hurt the rental business, however selling has become a very difficult proposition in the world of decorative arts. If you think it is cheap now, think oil glut. Fine arts, they are the rage. How does it look; edgy? Its better if it goes on the wall, where mirrors, consoles, and wall sconces use to roam. Chairs, tables, and accessories now require a minimalism in a deference to the presentation of art.
If the present trend is any indication, taste is “less”. It’s less because the present state of exposure to the decorative arts has never been more marginalized. The Sotheby’s/Christie’s duopoly relegate it to a side show; what more do you have to understand? We need to educate the world what we do, what we sell, and why it is so much fun. Rich or poor, the knowledge and appreciation of quality and design is priceless. We love it at Newel and we desperately want to share it with anyone who cares to partake. We need to be a serious advocate for the decorative arts because so few are.
At Newel, we seem to have our hands in many areas where the decorative and fine arts live harmoniously. Selling to interior designers who have the temperament to deal with clients that seem to know more than they do, is a daunting position for everyone. Having a set decorator put together a room for a TV show in a matter of hours is even more impressive. While watching a motion picture production, the set is so seamless to the action; it’s brilliant! Why not for your home, apartment, or office? It can and should change as easily as you want it too, (if you can afford it).
Newel is all about change and being part of how residential and visual design should evolve. We understand the past and appreciate the foundation and evolution of cultures and the value they placed in creating decorative and functional objects. We have an obligation to show our items anywhere that they will be noticed and create a sense of “wow”. It’s not really that hard when there are so many who have never had any appreciation of what it is. For Newel and the decorative arts industry to flourish, we need to be not only educators, but be more approachable to a new, young generation that has no idea we exist.