The Real Deal New York

Major art gallery gambles on unproven Chelsea location

Rising land values in the neighborhood will likely push out street's traditional tenants

July 01, 2014 08:32PM
By Adam Pincus

Travis-121-Kaplan

From left: Jonathan Travis, 121 West 27th Street and Casey Kaplan

A long-established fine art gallery signed a lease last month to relocate from the city’s painting and sculpture center near the High Line to a undistinguished street in Chelsea a block south of the Flower District.

The Casey Kaplan Gallery, an influential gallery launched in Soho in 1995, signed a lease to take 5,200 square feet on the ground floor and 5,000 square feet on the lower level, at 121 West 27th Street, between Sixth and Seventh avenues.

The block’s ground-floor retail spaces are occupied by an assortment of wholesalers, trendy fitness gyms and massage and nail parlors. In addition, a large development is coming. Across the street, a Peter Poon-designed, 20-story hotel is set to rise at 132 West 27th Street.

The rising land values in the transforming neighborhood will likely push out even more of the street’s traditional business-to-business tenants. In fact, the gallery is replacing a beauty and general merchandise wholesaler.

“I think that the [companies] that are doing well will try and stay and pay more, but those that are marginal are going to close up,” Gabriel Bullaro, an attorney and broker familiar with the neighborhood, said. “The real estate is too valuable and they can’t afford the rents.” Bullaro was not a party to the transaction.

The Casey Kaplan Gallery is now in a 5,000-square-foot, ground floor space at 525 West 21st Street, between 10th and 11th avenues, in the High Line neighborhood.

At the new space, Kaplan signed a 10-year lease with an asking rent of about $80 per square foot, according to Jonathan Travis, an associate director with Ripco Real Estate, who represented him.

Insiders estimated a ground-floor gallery space near the High Line such as his current location would ask about $100 per foot.

The changes in the High Line neighborhood are more than just increases in gallery rental rates. Developers are snapping up sites, and paying record prices for land. Alf Naman has put a building occupied by the Anton Kern Gallery on the market for $982 per square foot.

Kaplan’s gallery moved in part to stand apart, even as some galleries are doubling down in the High Line area, such as Lisson Gallery which recently signed a 15-year lease for 8,500 square feet, according to the Art Newspaper.

“Casey is a trendsetter. He did not want to be another gallery in the gallery district,” Travis said. The gallery expects to move in to the new space early next year. Kaplan did not return a call for comment.

Kaplan was also looking seriously in Tribeca, but his requirement for 5,000 square feet limited his options in other artist-friendly neighborhoods such as the Lower East Side and along Bowery, Travis said.

“Art galleries in general are looking for the next new district,” Lisa Rosenthal, a managing director at Lansco, said. She was not involved in the deal.

She noted that the influential Sperone Westwater Gallery moved to 257 Bowery in 2010, and a few galleries joined them there, while others have moved to the West 50s. No neighborhood, however, has emerged as the central refuge for galleries priced out of Chelsea, she said.

  • Damien Koons

    Is this a barometer of which galleries are doing well enough to stay near the High Line and which are not?

MENU