Friday, January 18, 2008

Rent

DCKT is opening on the Lower East Side (LES). Yeah for Dennis and Kenny T!!! We're so happy for the lads!

My favorite response to their good news was posted on
bloggy.com:

DCKT.. goes to the LES...
No wonder the drink prices have become so expensive over there !!

Posted by: MAO

As MAO also tells us, though, another emerging art gallery is opening on the Upper East Side (UES). This is a move I considered a while back, thinking it makes sense (because it would buck the trend and get some attention, which it has, and it would be close to the UES money and that might translate into better sales if done right, and let's face it, because the rents up there can't be that much more than they are elsewhere in the city now)...we'll watch and see:

Asher Edelman, a Wall Street raider turned art dealer, is seeking space to open a gallery on New York's Upper East Side that will show young and emerging artists.

Edelman, 68, has been a private dealer for about seven years, trading impressionist and modern works through Edelman Arts Inc. while promoting younger artists such as Yasmine Chatila, Christopher Winter and Cathy McClure. He is ending a joint venture in the Neuhoff Edelman Gallery because he prefers working on his own, he said.

But it looks like the LES is still the new hot spot. Bloggy.com also points us to the following article: "Rent Jitters Hit Chelsea in N.Y.; Art Galleries Look Downtown":
When Lombard-Freid Projects moved to West 26th Street in Manhattan's Chelsea area in 1998, the stretch between 10th and 11th avenues stood at the northern frontier of a fledgling art hub.

There were only two other galleries, a bunch of car garages, ``foul toxic odors and Annie Leibovitz's studio down the block,'' partner Lea Freid said.

The price was right, though. At the time, second-story spaces went for $14 to $15 per square foot in annual rent, and the gallery negotiated a 10-year lease below market rate. That lease is expiring this year, and the gallery may have to leave the neighborhood, now one of the world's major art districts.

"A lot of us are pounding the pavement,'' said Freid, who has all but given up on finding new space in Chelsea. "We were hoping it all will shake out, but that doesn't seem to be happening.''

Rent jitters are common among Chelsea art dealers these days, as the district becomes a victim of its own success. Car repair shops have given way to luxury towers designed by Frank Gehry and Jean Nouvel, and galleries in need of new digs must pay up or leave.
Indeed, just as the musical is closing on Broadway, Rent looms largerer than ever in New Yorker's ability to realize their dreams (studios aren't getting any cheaper either). According to one report, though, renters have at least one advantage at the moment:
The shape of the new American housing market — the post-bubble market — is starting to emerge. It is one that favors the young who never owned a house and the banks that have access to cheap deposits. It may be harshest on the two coasts, where both distress and a newfound lack of mobility may be on the increase.

The ideal home buyer now — in a reverse of what was true for years — is a renter who is not burdened with a house. Such a buyer will need a down payment from somewhere, and he or she will need enough income to meet the monthly payments for the foreseeable future, including any increase in adjustable rates that seems probable.

But not owning a home, which may be hard to sell, is a big plus.
And it's not just in the US. According to another report:
The financial benefit of buying a home rather than renting over a 25-year period has tumbled by 75% over the past year – with tenants better off than owners in half the UK's regions.
But before this morphs into a financial blog, let me return to gallery talk. Charlie Finch predicted recently that:

MANY CHELSEA GALLERIES WILL CLOSE
The double edge of the High Line development means that leases come due and the transformation of Chelsea into Fifth Avenue South will move into high gear.
I'm not so sure they'll close, as much as move (obviously), or evolve, but there's no doubt that space is getting beyond precious between 16th and 29th streets. And I'm not so sure how "many" galleries will be affected. Yes, leases are ending for a large number of spaces, but many larger galleries in the neighborhood purchased their spaces (having seen this gentrification transformation force them out of SoHo) and they'll continue to serve as anchors. In other words, for some galleries it will still make sense to pay the extra to be in Chelsea than to pioneer some new territory. For others, pioneering is why they're in the business, so....Eastward Ho!

Or is it Northward? There's also been plenty of speculation that Hell's Kitchen South (mid 30s) might follow the LES as the next area to attract spaces. With Exit Art's giantic space as an anchor and what looks to be plenty of warehouse type spaces (although admittedly, I haven't any idea what rents are there), this might make sense. (Psstt... don't tell the landords there...they'll raise the rents in anticipation). OK, so that's all I have...what are you hearing?

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9 Comments:

Anonymous Bambino said...

Congratss to DCKT

We'll be there for the opening

oxoxoxo

1/18/2008 10:33:00 AM  
Blogger Chris Rywalt said...

When James Kalm was helping us mount the Blogger Show, he predicted that the new art neighborhood would be in the Bowery, near and around the New Museum.

If that's what you mean when you say Lower East Side, I guess he was right. I've never been too clear on where New York neighborhoods are; I have the worst sense of geography of all time. I'm not even sure what to call the neighborhood I grew up in (aside from unpleasant).

1/18/2008 11:03:00 AM  
Anonymous Sus said...

Maybe you all should move to Pittsburgh. Yinz would be welcome.

Just kiddin'. I know this wouldn't work. But every time I think about the cost of real estate where you are, I go completely into sticker shock.

1/18/2008 05:44:00 PM  
Anonymous Anonymous said...

But Edward, don't you remember MLS?

Chris?

He/she posted here all of this months ago, almost a year ago.

What gives?

1/18/2008 05:50:00 PM  
Anonymous Anonymous said...

BTW, Viveros-Faune's conflicts of interest was mentioned by MLS in one post and nobody liked that.

1/18/2008 06:02:00 PM  
Blogger Mike @ MAO said...

Hey Thanks Ed for the link..

Yes.. all commercial rents have become silly expensive in NYC..even the LES!

Hey..so why not move to Williamsburgh...

oh..wait..been there.. done that.. sold NOTHING!!

Well..don't worry girls.. with the Residential Real Estate Crash in full sha-wing.. and Wall Street cutting everybody that could even spell the word CDO...

It's MAO's prediction.. in one to 2 years landlords will be cutting rents and begging for you to re-new even a dinky gallery lease!

1/18/2008 08:33:00 PM  
Anonymous Anonymous said...

What does the acronym MLS stand for?

1/19/2008 12:05:00 PM  
Blogger Chris Rywalt said...

MLS may very well have posted all this a year ago. They may be a brilliant prognosticator. I don't remember because my brain cells are all dying. On the positive side, every day's a new day! On the negative side...I can't remember what the negative side is. Something about memory....

1/19/2008 01:26:00 PM  
Anonymous Anonymous said...

It will be interesting to see how the art changes when galleries move to the more cramped confines of the LES after leaving the warehouses of chelsea. Smaller more personal art? I think the new museum was trying to point to that a little. The only problem is that the building boom that killed chelsea will eventually kill the LES as well (although maybe not for a while during this housing crisis.) I like it since I'm much closer to the east river than the hudson. F*ck New Jersey!

1/20/2008 10:25:00 PM  

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