Stunning Turn Of Events At The Geneva May Auctions By Sotheby’s And Christie’s

New record prices, along with the high valuation of diamonds’ brands, shows us that demand continues to grow and supply is not currently waning. Remember, the diamond and jewelry auctions that occur biannually in Geneva are known for the especially high prices that the pieces earn when they go under the hammer. Both the buyers and the auction houses know this, so often the auction houses save the absolute best gems for these occasions, and buyers come especially ready to pay high prices. High means paying in the tens of millions of dollars for a piece of jewelry, although plenty sell at the same time in the tens and hundreds of thousands at the same event, and also in the millions. The highest-level goods, which earn such incredible amounts of money, are almost always bought with investment goals in mind, meaning that at some far-off future date the buyer plans to resell and earn an extremely high premium. It certainly takes money to make money but in the case of these types of diamonds, it takes a lot of money in order to earn a lot of money. Imagine the liquidity of an individual who is able to use over $10 million that they can use on virtually anything but chooses to use it on such a long-term investment (over 20 years!)

Sotheby’s New Breaking records

Sotheby’s has been acquiring a very impressive roster of auction goods this year, and its most impressive by far is the pink diamond and blue diamond pair that they sold in Geneva, called the Apollo Blue and Artemis Pink diamonds. Although the Apollo Blue and Artemis Pink were sold as separate lots during the auction, they ended up being acquired by the same anonymous buyer over the phone.

The 14.54 carat Fancy Vivid Blue “Apollo Blue” diamond and the 16.00 carat Fancy Intense Pink “Artemis Pink” diamond

Image credit: Sotheby’s

The Apollo Blue diamond is a 14.54 carat Fancy Vivid Blue pear shaped diamond with an incredibly rare Internally Flawless clarity. It sold for a total of $42,087,302 or $2,894,587.48 per carat. Knowing the typical prices and values of blue diamonds as we do, at first glance, it is certainly a low price per carat paid for something so valuable. However, looking at the total price paid, puts it into a different perspective. There are few people in the entire world with such liquidity. As much as wealthy individuals continue to mint wealth on a global scale, it is still rare that this amount of money is readily available.

The 14.54 carat Fancy Vivid Blue “Apollo Blue” diamond          Image credit: Sotheby’s

The Artemis Pink diamond is a 16.00 carat Fancy Intense Pink pear shaped diamond with a VVS2 clarity. It took over 15 long minutes before it was sold for the final price of $15,338,176 or $958,636 per carat. The Artemis did not shatter a record price per carat, but it is still one of the most expensive pink diamonds ever sold.

The 16.00 carat Fancy Intense Pink “Artemis Pink” diamond          Image credit: Sotheby’s

Together, The Apollo and Artemis diamonds were sold for a total of $57,425,478 or $1,880,336.54 per carat (on average).

Fancy Intense Pink Diamond Breaks a Record

The 7.04 carat Fancy Intense Pink diamond, also sold by Sotheby’s, was sold for a total of $13,245,750 or $1,881,498.58 per carat. It sold for well above it’s high estimate of $12.1 million and broke a record for this category (5-10 carat Fancy Intense Pink). The main reason for this is the color. It is a strong Intense Pink Diamond, which the buyer had acquired for a price based above an “Intense” color’s price. How can that be, and why? Because there is very strong potential that this diamond can be recut, and the color will be improved into a Fancy Vivid Pink, increasing the potential value and price of the diamond.

7.04 Fancy Intense Purplish Pink VS1 diamond          Image credit: Sotheby’s

The previous record for the 5-10 carat category was held by the 6.54 carat Fancy Intense Pink diamond that sold on December 5, 2012, also by Sotheby’s. Its price was $1.314 million per carat, and it also held the record of total price paid for a diamond in this size category. This was broken now by this 7.04 carat Fancy Intense Pink diamond, but only four and a half years later.

6.54 carat Fancy Intense Pink diamond          Image credit: Sotheby’s

 

In the case where the buyer will fail to upgrade the color (which is highly unlikely), then the price paid exceeds the value price for such a diamond, and would therefore would be considered a ‘failure’.

The per carat price paid for the pink also broke the world record for any Fancy Intense Pink. The last record was held by the Graff Pink Diamond. The 24.78 carat Fancy Intense Pink diamond was acquired by Graff back in 2010 was sold for $1.862 million per carat. Graff later re-polished the diamond to a 23.88 carat Fancy Vivid Pink with an IF clarity. By doing so, Graff increased the value substantially. Six and a half years have now passed, and without taking inflation into account, the price per carat was still broken.

23.88 carat Fancy Intense Pink “Graff Pink” diamond          Image credit: Graff Diamonds 

Fancy Vivid Blue Diamond

The 3.32 carat Fancy Vivid Blue diamond was sold for $6,798,815 or $2,047,835.84 per carat. Although it did not break a record for this category, it did signal a strength in price for Fancy Vivid Blue diamonds above 3 carats in size. We shall see how the 3.98 carat Fancy Vivid Blue VVS2 will sell in Hong Kong next week.


3.32 carat Fancy Vivid Blue IF step cut diamond          Image credit: Sotheby’s


3.98 carat Fancy Vivid Blue diamond from Moussaieff          Image credit: Christie’s

Fancy Pink Diamond Finally Sells

The 21.11 carat Fancy Pink diamond was estimated to be valued between $3-$5 million, and ended up selling for $5,441,565 or just under $258k per carat. It was offered last year in Geneva and failed to sell, when it was valued at $5-$9 million. It was Lot #489 last year, but no longer appeared there at the Sotheby’s website. Last year, the highest bid for it was $4.4 million Swiss francs, which was below its low estimate and which was probably the reserve.


21.11 carat Fancy Pink VVS2 diamond          Image credit: Sotheby’s

Conclusion

Over all there were good sales and prices at the Geneva shows. However, the mood was rather mixed between both auctions. While at one it was vibrant and excited, the other one was not as exciting, probably due to the large differences between their catalogs. Investors are cautious about how they invest their money, and large transactions take time to close. Another important element in large transactions, is that investors want to avoid the large commission they pay to auction houses, which fall into the 12% on average, and prefer private transactions. Therefore, they choose their auctions carefully, and only buy at one when what is being offered is too important to miss.

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