Opening Your Own Gallery (Part III)

Photo courtesy the gallery

Rosalind Solomon, "Whoppers, Chattanooga, TN" (1979)

Photo courtesy the gallery

Laura Wulf, "Orange Cubes on Magenta" (2004)

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In Part I of our answer, we covered some of the basic financial (and moral) issues behind operating a gallery. In Part II, a trio of young gallerists offered a Top 10 tips list.

In Part III, we get down to “brass tacks”: quantifying some of the specific costs that a new art dealer will face in establishing a gallery.

To do so, I spoke with Michael Foley, who opened the Foley Gallery on West 27th Street in Chelsea two years ago. The gallery specializes in contemporary photography and works on paper.

Foley worked in other photography galleries for 15 years before establishing his own business, including Fraenkel Gallery, Howard Greenberg Gallery and Yancey Richardson Gallery, and he continues to teach at Parsons School of Design and the School of the Visual Arts.

When I explained to him that my starting point for these columns had been an email that had included the line “there seems to be a lot of money to be made as an art dealer,” he laughed out loud and said, “Let me talk to this guy. Let me set him straight …”

After we identified five headings that need to be part of any sensible business plan, and begun to put some realistic figures against them, I began to see what he meant…

(Please note that, of course, there can be huge variation in the costs involved, depending on how big a space one goes for and where it is.)

1. LOCATION COSTS

• Rent: $3,000 - $30,000+
• Build-out costs: $15,000-?
• Set-up costs: $20,000-?

“For anyone considering opening a gallery, the first place most of their money is going to go is to rent and build-out costs,” Foley said. “And remember that your landlord is going to want your first month’s rent, plus a deposit, plus your last month’s rent up front, so if your rent’s $4,000, that’s $12,000 right up front that you’re not going to see again.”

I asked Foley if $4,000 was a realistic monthly rent. “It’s going to be anywhere from, sa,y $3,000 to $25,000 or $30,000 if you want a ground floor space. But in Chelsea a ground floor space is not only rare to find, it’s so competitive now. Even if a ground floor space were to open up miraculously, there’s always going to be somebody who wants that space and who is willing to pay a lot of money to get it.”

And then there are build-out costs. “Even if you’re moving into a space where a gallery already was, there’s going to be a key fee or a fixtures fee. If you’re going into a raw space, then there can be tremendous build-out costs,” Foley warned. “I suppose you could go into an 800-square-foot office space and spend very little on build-out, say $15,000. But I’ll tell you, I spent $45,000 building-out this 1,200-square-foot space, including architectural fees and wiring.”

“Then,” Foley continued, “there are general set-up costs. You have to set up an office: desks, chairs, cabinets, flat files, bookcases, tables. Then there are the telephones, credit card machines, printers. I suppose that if you went to Ikea [and Staples], you could do it for about $20,000 or $25,000, but then you’d be getting items that are functional, but nothing beyond that.”

2. STAFFING

“Do you pay yourself or do you not pay yourself, that’s the big question,” Foley said. “Do you require additional staffing, or can you get by with a legion of interns? I am literally a sole proprietor. I have one fellow that I pay one day a week to come in and do various jobs for me. Fortunately, I’m also a teacher at SVA, so I usually have three to four interns a season.”

I asked Foley whether he paid himself. “Intermittently,” he replied, with a laugh. “That’s something that people forget. How are you personally going to make a living when your sales are really low for six months? People coming from a salaried job, like another gallery, they have to remember that they’re not going to be getting paid by someone else, and they’re not going to be getting bonuses from someone else.”