If you are a gallery in New York City, I would expect the rents would be high, but what is happening in the Chelsea real estate market is now starting to hurt the mid market galleriest who moved their to avoid high rent in other destination areas of the city.
Bloomberg has an article noting several galleries in Chelsea are closing or moving to other areas because of the strong NYC real estate market and rising rents. The articles not ground floor space is now typically in the $80-$120 per square foot range. Doing the math, for a 3,000 square foot gallery the rental range is $240,000 to $360,000 per year, or $20,000 to $30,000 per month. That is some rather serious overhead to cover for a small gallery.
I have seen many art galleries and antiques shops disappear in Old Alexandria because of the high rent and commercialization of the area. It is sad to see the businesses that have made the area interesting and popular have to leave only to be replaced by a CVS, Restoration Hardware or GAP outlet.
Bloomberg reports
Source: BloombergThe midsize art galleries that helped transform western Chelsea from a dead area adjoining the West Side Highway into New York’s major art hub are being squeezed out of the neighborhood by booming real-estate development and rising rents.
“The mid-range galleries are going to just vanish from Chelsea,” said Sawon, who expects that “anything radical or experimental” will become rarer as dealers seek to cover expenses by staging more-predictable shows that do well commercially.
Anchored by the elevated High Line walkway and park, the area between 10th and 11th avenues is attracting technology and fashion companies that present tough rivals to contemporary-art galleries.
“Every developer in the city wants to be in West Chelsea,” said Stuart Siegel, senior vice president at CBRE, who has worked with many galleries as a commercial broker in western Chelsea since 1993. “The galleries that don’t own their spaces will be under pressure.”
Cold Castle
Several fashion boutiques, a CVS store and a yoga studio have moved into the area recently. Hewlett-Packard Co. has leased the building formerly occupied by the Chelsea Art Museum.
A building known as Cold Castle, where dozens of artists had studios, will be razed to make room for a 19-story residential tower.
Landlords are asking from $80 to as much as $120 a square foot for ground-floor space between 10th and 11th avenues, compared with a range of $55 to $75 in 2010, Siegel said.
Shroeder Romero recently closed its space on West 26th Street. Partners Lisa Schroeder and Sara Jo Romero said they will experiment with other models of operation, including pop-up shows and online sales.
“Like a lot of our middle-tier colleagues, we were feeling overlooked,” Romero said. “We can’t compete with David Zwirner and we are not a fresh new space anymore.”
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