Mide Sized Galleries Struggling

The NY Times posted an interesting article on mid sized galleries and the issues they have in competing with well financed mega galleries. Many are closing due to high costs of overhead including leasing space.

Below is a partial clip from the article. Follow the source link below for the full article.

The NY Times reports
The Lower East Side gallery On Stellar Rays announced in April 2016 that it was expanding into 4,500 square feet, to allow for a more ambitious exhibition program as well as performances in its basement space.

This month, just over one year later, the gallery announced that it was closing.

On Stellar Rays has plenty of company. In February, Andrea Rosen, a 27­year Chelsea veteran gallery owner, announced that she was closing her exhibition space on West 24th Street and not taking on more living clients. Other stalwarts of the New York art scene that recently closed locations include Mike Weiss Gallery, CRG Gallery, Laurel Gitlen Gallery, Murray Guy, Kansas, Feuer/Mesler and Lisa Cooley.

In Los Angeles, the dealer Mark Moore closed his Culver City gallery in December after 33 years, and this month Acme gallery in Frogtown ceased operating after more than two decades. And in London, several galleries have recently shuttered, including Limoncello and Vilma Gold.

Midsize galleries have long struggled to compete in a field increasingly dominated by mega­galleries with multiple locations, like Gagosian, David Zwirner and Hauser & Wirth. But lately the trend toward an intensely commercial and competitive art market has resulted in a critical mass of galleries folding, moving or merging.

Some see the solidifying of a class society. “There is less support for the low end of the market,” said Rachel A. J. Pownall, who prepared the European Fine Art Fair’s 2017 Art Market Report. Dr. Pownall added that “the gap has become greater” between smaller galleries and large ones, which “are traditionally better positioned to reach a wider audience, sell at auction, present at art fairs and gain brand reputation.”

What is widening the divide? High­priced real estate in gallery neighborhoods like Chelsea, and the proliferation of expensive art fairs, where collectors now do most of their browsing and buying. Participating in an art fair these days can cost a gallery hundreds of thousands of dollars.

And rather than visiting individual galleries — and perhaps discovering newtalent — collectors are focusing on market­tested trophy works carried by major dealers; are sometimes buying from Instagram or other online images without seeing the work in person; and are less willing to gamble on the emerging artists represented by small and midsize galleries.

The statistics bear this out. According to the art economist Clare McAndrew’sArt Basel­UBS art market report, dealers with business of less than $500,000 saw their sales decline by 7 percent in 2016; dealers with business of $500,000 to $1million had a decline of 5 percent.

By contrast, those with business of $1 million to $10 million saw sales rise by 7 percent; galleries with sales of $10 million or more grew by 2 percent; and dealers with business above $50 million saw their sales increase by a whopping 19 percent.

But galleries are not only bowing out for economic reasons. “I really feel like I’m not doing some of the things I love most — it’s just a very different business at this level,” said Candice Madey, the owner of On Stellar Rays. “I’ve missed more of the spontaneity and the openness.”
Source: The NY Times 

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