Galleries Comparing Downturn to Post-9/11 Slump

“There are more dealers hanging on by their fingernails but no-one will go on the record,” said a prominent art world public relations expert who was speaking anonymously with The Art Newspaper. “Everyone is wondering if the downturn will be just like 9/11,” she added. With the economy going south, art dealers are starting to feel the crunch. They’re admitting to sluggish sales, hesitant clients and canceled deals amid continuing financial market woes, according to The Art Newspaper. “Nobody wants to say the sky is falling but perception affects every market and clearly, we are entering a new period in the economy,” Martha Fleischman, president of Kennedy Galleries, told the paper. “The people who see art as part of their portfolio and like to flip will get an education very quickly this year,” she added.

“Six months ago, everyone talked of expanding but now merging is the topic,” said Michel Allen, 36, who opened Allen Gallery in Chelsea in December 2006. Her clients include Russian corporations, major financial firms such as Gruss & Company and trendy designers such as Celerie Kemble. “Lately, other dealers have approached me about merging,” she said. She has seen her sales decrease 10% in the second half of last year with photography particularly affected.

But although her rent doubled this summer, she has turned down offers of partnerships to share costs. “I’m still up compared to last January’s sales,” she explained, but said this has required considerable efforts. “I’m working 24/7, I’ve accepted more speaking engagements than before and have been giving more collector walks in Chelsea while going out to many events.”