A four-year study by the University of Southern California Lusk Center for Real Estate challenges the notion that Manhattan’s art galleries spring from low-rent Bohemian-style neighborhoods.
The study shows that art galleries tend to cluster together in high-end neighborhoods near affluent potential buyers.
The research team found that 60 percent of Manhattan’s galleries were located in just three high-end neighborhoods: the Upper East Side, Soho and Midtown. They also found that galleries stayed in business longer when clustered together near affluent customers.
“These findings counter the common and somewhat romantic perception that galleries locate in gritty artist communities,” said Jenny Schuetz, an assistant professor and economist who specializes in urban economics and retail.
“Similar to jewelry, furniture and antique districts, most galleries cluster near affluent potential art buyers, rather than the artists themselves.”
The results of the study came as no suprise to one-time art history student and designer, Faith Hope Consolo, chairman of the retail group at Douglas Elliman.
“Like any good retailer, you go where the shopper is, rather than the merchandise maker,ˮ said Consolo.
“The survey is right — art galleries go to areas that are already successful. But they’re important to the lifeblood of a city — whether it’s London, Paris or New York, etc. Even if the artists can’t afford to live in the neighborhoods that eventually sell their works, they do tend to move to these cities hoping to be discovered.
“That brings an artistic and intellectual component to lower-priced areas, that eventually become more affluent as those artists succeed.
“Think of the artists who lived in Greenwich Village until it attracted an affluent class. So they moved to Soho, or Chelsea. When those became unaffordable, Williamsburg became the next stop — and so on and so on.
Steve Rappaport, a retail specialist at SInvin, said the study ignores the reality of the real way neighborhoods develop in most areas.
“One can skew and interpret numbers in any way. Of course the larger more affluent galleries employ more people and do more business. That does not obviate the fact that new neighborhoods develop in a certain way, and that new neighborhoods eventually become established neighborhoods,ˮ said Rappaport.
“In forty years of watching Manhattan change, my observation is that it happens in the same way every time.
“First antique and craft-type furniture business, followed by galleries, followed by small retail followed by galleries, followed by clubs, followed by restaurants and then followed by more established retail. As retail takes hold and rents increases the pioneer are eventually forced out.
Schuetz — who led the research team along with and Richard Green, director of the USC Lusk Center for Real Estate — explained how the research is intended to guide the decision making of policymakers and gallery owners.
In particular, the study will give city officials a better understanding how galleries impact broader economic development initiatives aimed at revitalizing blighted neighborhoods.
Gallery owners and their financial backers, meanwhile, can better assess how upscale locations next to other galleries – and the high rents that come with them – will impact their long-term success.
“It’s absolutely worth it,” Schuetz concluded. “Galleries that are clustered together in well-known gallery districts stay in business longer.”
While both Schuetz and Green concede that New York’s gallery scene may not be representative of art markets in smaller U.S. cities, they believe the findings are applicable to international art meccas such as Los Angeles, Paris and London.
“Like a lot like luxury retailers, successful galleries choose neighborhoods that have high-end amenities, near parks and museums, with upscale customers who can afford to buy expensive goods,” Schuetz added.
