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? High-priced 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 new talent — collectors are focusing on market-tested 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’s Art Basel-UBS 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 $1 million 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.”