Painted Into a Corner: Berlin’s Floundering Art Market

CNBC Business Magazine, Nov. 1, 2011

Ute Litzkow is pretty pleased. She has sold three art works so far at Berlin’s annual Kunst Herbst (‘Art Autumn’). The 38-year-old is standing next to one of her pieces, a vibrant multicoloured version of a traditional Japanese print, in one of the countless large booths that are lined up in rows in a cavernous hangar of the former Tempelhof Airport.

The crowd is heaving on the opening night of Preview Berlin, a satellite show dedicated to emerging art that usually occurs alongside the city’s traditional art fair, the Art Forum. However, this year the main event is not taking place and Litzkow says she has heard that several international collectors have not been spotted this year. “Berlin without an art fair,” she says. “It’s crazy.”

The cancellation of the floundering Art Forum, which had been going for 15 years, wasn’t a huge surprise, but it occurred against the background of a sluggish market, closing galleries and a spat between artists and the city government in what has been a turbulent year for Berlin art.

“After years of promises, and of feeling that Berlin is going to be the next big city, it feels now that it’s not going to be any bigger,” says Thomas Eller, an artist who also served as managing director of the Temporäre Kunsthalle, a temporary exhibition space set up on the old site of the Berlin palace in 2008. “That is why there is a certain air of disappointment here.” The way Eller sees it, there is a feeling that the city may be peaking as an art market.

While Berlin has long enjoyed a reputation as a vibrant creative centre attracting artists, both struggling and successful, it has not really been able to translate that into a thriving commercial hub. And there is frustration at the government’s lack of understanding of the needs of the city’s artistic community and at its failure to fund a really strong public infrastructure.

A case in point was June’s Based in Berlin exhibition, which showcased some 80 artists. The way the show was organised did not go down well with many in the local art community. A brainchild of Mayor Klaus Wowereit, it was perceived as a flagrant piece of electioneering ahead of September’s vote for the Berlin state parliament, and an attempt to give a boost to his pet project of building a permanent art hall in the city. A group of 230 artists, curators and critics wrote an open letter announcing a boycott of the show. In the end, Berlin’s highly indebted government put the debate over the hall on ice, announcing that its budget for next year wouldn’t stretch to such a project anyway.

Many galleries and artists felt that the show’s €1.6m budget could have been better spent on chronically underfinanced institutions such as the Kunst-Werke, the city’s prestigious institute for contemporary art, and the Berlinische Galerie, which has no budget to buy its own collection. Esther Schipper, who moved her gallery from Cologne to Berlin in 1994, says Wowereit’s government should support the institutions that exist. “Not just the big ones like Kunst-Werke, but also the smaller ones. That is key for the future.”

Berlin’s government did, however, plough funds into the Art Forum. Yet the fair had never set the art world alight, showing poor sales, and was eventually shunned by Berlin’s clique of 20 or so major galleries. They decided to set up a rival Gallery Weekend, which takes place each spring, and went on to establish Art Berlin Contemporary (ABC) in 2007. The eventual failure of ABC and Art Forum to agree to a merger is what led to the latter’s abrupt cancellation in May.

Unlike Art Forum, the nature of the ABC, which is a hybrid of curated show and commercial fair, is exclusive, with the organisers selecting the relatively small number of galleries they wish to take part. That means that the vast majority of the city’s estimated 400 galleries now have no official forum to show their artists’ pieces, something that has caused no little resentment and concern in Berlin.

“Medium-range or smaller galleries could never dream of going to Art Basel and all of a sudden they lose their venue, or what they identified with as their venue,” says Eller.

While the top tier of Berlin galleries can avail of their international network of contacts and customers, other galleries have to make do with local buyers for most of the year. This was why Art Forum was so important, as it gave them the rare chance to also sell to international collectors.

Cai Wagner of the Galleries Association of Berlin (LVBG) says: “You can complain that the top collectors were The Kunsthalle never there, and that it didn’t sell well, but still, it brought people to Berlin at a certain time, and it remains to be seen if ABC can do that.”

Markus Heinzelmann – director of the Museum Morsbroich, a publicly funded contemporary art gallery in Leverkusen – argues that an important art centre is more interesting if it has an art fair. “The fact that Berlin has lost this is a bad sign. If you look at London, its value as an art centre has been hugely increased by the Frieze Art Fair. Berlin’s was never a top fair, but it will be missed.”

However, Daniella Luxembourg, a private art dealer and consultant in London, Geneva and New York, doesn’t see the cancellation of the Art Forum as making much of a dent to the city’s reputation. “I think Berlin doesn’t need fairs in order to be important. I have no worries for Berlin,” she says. “If the market is a little slow in Berlin, it’s because there are so many galleries. They shouldn’t have opened so many commercial galleries.”

Indeed, Berlin’s many smaller and mid-sized galleries have been under a lot of pressure since the global financial crisis began three years ago. “They don’t have the top artists, but are trying to sell art for between €5,000 and €25,000 to professionals like tax advisers, dentists and lawyers,” Wagner explains. That can be difficult in a city that is one of the poorest in Germany, without any major industries or a financial hub, and where unemployment is still stubbornly around 13%.

Wagner points out that while the top 5% of Berlin’s galleries earn large sums, from €500,000 upwards a year, half earn less than €50,000. “The average for a gallery in Germany is around €300,000 a year.” Several galleries have already been forced to close, he says, while others have had to let staff go and move to cheaper locations.

Meanwhile, the market that really makes London and New York such important art centres – the secondary market, where dealers buy and sell incredibly valuable works – barely exists in Berlin. “Most of the money that is turned around in the art market is turned around in the secondary market,” says Eller. “And nobody in their right frame of mind would open a big secondary-market company here.”

Schipper agrees: “Berlin is the place where you come to discover young artists or where international artists have their studios, rather than a place for major art dealers.”

It is undoubtedly true that Berlin has developed into an extremely strong production location for emerging art; and established artists such as Danish-Icelandic Olafur Eliasson, Scandinavian duo Michael Elmgreen and Ingar Dragset, and British film artist Phil Collins, are increasingly choosing to be based here. Chinese dissident Ai Weiwei had been planning to buy a massive former factory in the east of the city to turn into a studio when he was arrested in April.

Yet one of the main reasons so many artists have moved to Berlin – the availability of inexpensive studios and apartments – is being jeopardised as the city gets more expensive. Popular districts are already rapidly gentrifying.

Ellen Blumenstein – a freelance curator who also runs the Salon Populaire, a regular forum for discussion and debate about culture and art – says things have got very tough financially for Berlin’s creative community. “In the last three years, things have changed a lot here. The rents have soared, so that there is a real scarcity of living and working spaces. A situation that had once been difficult – in that you can’t really earn money in Berlin – has got worse. A precarious situation has become extreme.”

She says that the concentration of artists and the opportunity for intellectual exchange mean that Berlin is still attractive. “But if everything becomes so expensive, at some stage people are going to have to leave. The politicians haven’t really understood this. They seem to think everything is super, there are lots of artists, and Berlin is a vibrant art city, and they don’t seem to realise that everyone is struggling to get by. The politicians won’t be able to market the city like this if all the artists leave. Art is what gives Berlin its image – it doesn’t have anything else.”

According to a study by the Institute for Strategy Development (IFSE), about a third of the 6,000-7,000 artists living in Berlin are not represented by a gallery, their average annual income is around €12,000 and fewer than 1,000 can survive on selling their art alone. The rest get by either through family support, benefits or doing other work.

Hergen Wöbken, who headed up the study, says the city doesn’t have enough money to provide artists with grants – and nor should it, just as it wouldn’t support hairdressers or handymen. Some art is just not that good and not everyone can be successful. “Not all artists can live off their art. It is the artists’ responsibility to say whether they will continue to live in precarious circumstances, or change jobs.”

What the city needs to do, he says, is to sit down with artists and work out together what the long-term goals should be. He recommends that the government secures more studio spaces, before prices become too high, and increases funding for municipal galleries in the districts.

“Artists are small businesses, and they can only operate when they know what they can plan for, when they know they will have a space, what the prices will be like. The whole sense of insecurity in Berlin does not create a climate conducive to productive and creative work,” he says.

Oliver Walker is one of the thousands of young foreign artists who have made Berlin their home. The 30-year-old from the UK has lived in the city since 2009, staying on after completing a Masters at Berlin’s UdK art school. He has already seen some success, with a show in Berlin’s well known NGBK gallery and upcoming exhibitions in Liverpool and Gdansk. Yet he says the chances of finding a gallery to represent him is thin. “That commercial world is like a football league system and I don’t have a team.” To get by, he helps out with installing and making parts for exhibitions, as well as doing some translation work.

He would like to see the Berlin government putting its money where its mouth is in terms of supporting contemporary art. “The Berlin Senate’s budget for stage arts is 50 times that for visual arts,” he notes. “Visual art production is barely funded.” He wants to see the concept of artists being paid properly for their work being more accepted – pointing out, for example, that those who took part in Wowereit’s Based in Berlin show were only paid €500 for their participation, despite its hefty budget.

He argues that paying artists properly wouldn’t be a handout, but a means of giving back some of the money they have already earned for the city. “Politicians have already sold this city on the basis of its art. So there are already tourists here, and they are already getting the money,” he says.

Moritz van Dülmen, director of Kulturprojekte Berlin, a state-funded agency that organises cultural projects, says that it is difficult to quantify exactly how much money art brings to the city. Galleries are not making huge tax contributions, but that there are indirect benefits: for instance, many companies move to the city because they know they can attract international creative professionals.

“The fact that it is the coolest, hippest city in Europe, perhaps the world, is particularly due to the fact that there are so many artists here,” he adds. “Of course, it’s of great value. It puts Berlin on the international map, not because it has a big art fair, but just because it’s the place to be.”

Originally Published in CNBC Business Magazine, November 2011 edition.

http://www.cnbcmagazine.com/story/painted-into-a-corner/1485/1/

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