True Lies: What a Few Healthy Numbers Hide About Midmarket Mortification
Earlier this week, Christian Viveros-Fauné published the second chapter of his excellent deep-dive investigation "The Middle-Market Gallery Squeeze," which seeks to answer whether the sector's median is indeed under siege, as so many observers now attest––and if so, why. This time, he takes somewhat of a point-counterpoint approach to the prevailing narrative, offering almost equal page space to a trio of pessimists and a lone optimist. But as inclined as I normally am toward contrarian arguments, I think the data-based approach used by the latter fails the smell test––not because the numbers are false, but because they don't actually address the question that matters.
First, though, let's set the stage for people who, unlike me, are interested enough in living a well-rounded life not to spend most of their days obsessing about topics like this one. A few weeks ago, Viveros-Fauné centered part one of his series on consultant-turned-gallerist Cristin Tierney, who candidly discussed the many pressures ratcheting up on sub-elite galleries in the post-2008 era, from rising rents to swelling operational expenses to waning collector interest in unbranded artwork. In the first half of part two, he continues that story through interviews with recently forced-out gallery veterans Edward Winkleman and Mark Moore, as well as Joel Mesler of the still-in-demand yet still-vulnerable Lower East Side space Feuer/Mesler.
Of the troika above, Mesler supplies (to me) the piece's most insightful and (to many others, I'm sure) most discouraging quotes: "Artists are no longer the dealer's clients... We're in the Gagosian model now, where the collectors are the dealer's clients." The implication? That many, if not most, gallerists have pivoted away from trying to promote the under-recognized talent on their own rosters, opting instead to simply focus on selling the branded artists that collectors already want to buy. And that strategic shift helps spur the retreat to consensus that endangers the sector's entire middle tier.
But to contest this dominant perception of today's gallery ecosystem, Viveros-Fauné then brings in finance writer Felix Salmon, a former Reuters correspondent now ensconced at new-media vertical Fusion. Salmon, whose ongoing interest in art and business occasionally leads him to pen posts in the same jurisdiction as The Gray Market, points back to his 2015 piece "The death of the art gallery has been greatly exaggerated" as evidence for an alternative interpretation of the industry. There, he argues that accurately assessing the state of the gallery sector demands that we look not at closure announcements and cautionary tales in the art press, but rather at real-estate market demand in New York gallery districts. And there, he claims, "the numbers don't lie." They just tell a counterintuitive truth.
To Salmon, the steadily rising rents in Chelsea and the LES indicate the gallery sector is thriving like never before, at least in terms of interest and available resources from new sellers. Yes, price hikes on square footage may be torturing more experienced gallerists like Mesler and Winkleman––sometimes to the point of no return––but as soon as their spaces are vacant, plenty more arts entrepreneurs are ready to step in and satisfy the new asks. Viveros-Fauné mentions that objective statistics in the Empire City even seem to back up this idea, as the 2015 Creative New York report verified that the total number of galleries in the world's art capital actually rose from 1,138 in 2004 to 1,384 as of last summer.
But as has historically been the case about 50 percent of the time Salmon delves into the art industry, I fundamentally disagree with his viewpoint here. If he wants to suggest that the middle-market gallery is in great shape just because new gallerists are willing to ignore the earlier tenants' fate and pay higher rents for the same real estate, that's a little like suggesting that shooting heroin is a great idea just because plenty of new junkies are willing to ignore thousands of dead smack addicts and start copping. His line of argument certainly explains why today may be the best time in history to work as a Manhattan REALTOR. A Manhattan gallerist, though? I don't think the logic holds.
Salmon states later in Viveros-Fauné's piece that "galleries and restaurants are famously run by people who have no idea how to run a business." Broadly speaking, I agree with him here. But in this case, the specific identities of the departing gallerists matter. Sure, there are plenty of recent art-sales casualties who only managed to stay open for a handful of years before succumbing. But there are many others whose longevity suggested that they were, in fact, the rare exceptions who had figured out how to operate a gallery sustainably. Winkleman, if memory serves, had been selling art since the early '90s and has written a pair of clear-eyed books on the subject. (Regular readers of this space may remember me referencing the more recent of the two, Selling Contemporary Art, on more than one occasion.) Moore is a 33-year veteran, as Viveros-Fauné notes near the start of his piece. And the tally of recent long-tenured tap-outs mentioned early in Salmon's 2015 post should be sobering to anyone in the trade: Jérôme de Noirmont (20 years in business), Yvon Lambert (29 years), McKee Gallery (41 years)... the list goes on.
In other words, not all sellers are created equal, and I think it's misguided to treat them as though they were. Which is exactly what Salmon's macro view of the real-estate market does: renders every tenant a replacement-level gallerist.
This flattening device also explains why I don't think the Creative New York report necessarily supports Salmon's argument, either. Counting the TOTAL number of galleries offers no insight into the state of MIDLEVEL galleries specifically. Even though the city netted +246 galleries in the 2004-2015 period, we have no indication of which of those newbies are scrappy emerging spaces––like, say, Ramiken Crucible, pushing edgy work out of a storefront hidden behind a liquor shop since 2010––or out-of-town heavyweights finally expanding to New York to play King of the Hill––like, say, Blum & Poe, which opened its New York location in 2014. If gallery interest is indeed bifurcating to the high and low ends, then more New York galleries can be founded in the aggregate, and more rent paid by many of them, while the midlevel still shrivels up like a mummy under a heat lamp. The outcomes are not mutually exclusive.
Now, would I be willing to bet my life that the midlevel gallery is in the worst state in industry history? No, but keep in mind that I have a pathological fear of staking out absolute positions. Aside from that, I'm also too cognizant of the possibility that we're simply better informed about what's happening now than we ever have been previously, and that our collective step toward omniscience can distort our understanding of reality in the arts and everywhere else. (This is the same principle behind why many people think the world is now more violent and dangerous than it's ever been––even though, as evolutionary psychologist Steven Pinker has argued, the data tells us that the exact opposite is actually true.)
Nevertheless, based on the evidence I've seen so far and the way it fits with broader trend lines, I'm still more inclined to believe that the gallery sector is in the midst of permanently morphing into a barbell shape: a dense top and bottom, with only a slender stem left to stretch between them. I very well may be forced to change my stance at some point. It's just going to take something sturdier than the data above to knock me off my current position. Until that happens, the middle-market gallery squeeze will remain, in my eyes, the rare instance where the prevailing narrative actually does what is so foreign to the art industry most of the time: tells it like it is.