How to Buy: Estate Jewelry

WSJ, October 21, 2010

The provenance of a major piece of jewelry can often add to its allure and its retail value. But be sure you get the story straight before you hand over the cash

It is a matter of some debate as to whether Wallis Simpson, the American-born Duchess of Windsor, and King Edward VIII, the man who abdicated the British throne in her honor, had the greatest love story of the 20th century. But one thing is certain: Nothing rivals its spectacular epilogue, the events of which unfolded on a mild April evening in 1987, when 1,200 people gathered beneath a tent overlooking Lake Geneva to peek inside the duchess’s legendary jewel box. Its rare cache of Cartier panther jewels, Van Cleef & Arpels mystery-set bracelets and Harry Winston diamonds represented the ultimate convergence of history and taste.

Sotheby’s spared no expense in showcasing the collection to a black-tie crowd that included diamond mogul Laurence Graff, Hollywood divorce lawyer Marvin Mitchelson, 17 television crews, 200 journalists and Elizabeth Taylor, phoning from “poolside in Los Angeles” to place the winning bid on a Prince of Wales feather brooch.

The sale, which earned $50.3 million (about $45 million of which went to the Pasteur Institute), six times the estimate, revolutionized the market for secondhand jewelry, a catchall term that includes antique jewelry, defined as anything more than 100 years old; period jewelry, referring to pieces from distinct design eras; and estate jewelry, a fancy name for pre-owned baubles of any age.

Bidding via phone that day was Calvin Klein, the most high-profile example of the new breed of private buyer. Willing to pay for provenance, the circuitous journey of ownership that can render an ordinary, if beautiful, jewel extraordinary, he spent $733,333 on a single-strand natural pearl and diamond necklace by Cartier that had once belonged to Queen Mary, wife of King George V and the mother of Edward VIII. He also bought a Cartier baroque pearl and diamond pendant, circa 1950, for $300,667.

The pearl strand and pendant resurfaced at Sotheby’s in 2007, when they brought $3,625,000 and $505,000, respectively, reflecting an age-old truth about jewelry: “It’s the most fluid market in the world,” says Francis Norton, a director of S.J. Phillips, an antiques dealer in London.