After Floods, Galleries Face Uncertainty

By ALLAN KOZINN

Published: November 7, 2012

At most of the art galleries in Chelsea the water that poured in from the Hudson River during Hurricane Sandy has been pumped out, and the business of sorting out artworks — separating those that survived intact from those that didn’t, figuring out which of the damaged works are reparable — is well under way. Gallery owners no longer sound as despondent as they did last week, when they returned to their businesses in the strip between 10th and 11th Avenues, from 18th to 29th Streets, and found flooded basements, high water marks five feet up their walls, and a loss of art, documentation, catalogs and reference books, to say nothing of physical spaces that will need to be rebuilt.

Angel Franco/The New York Times

Wet prints and paintings being laid out to dry at Gallery Henoch.

Angel Franco/The New York Times

Paintings and sculptures at Gallery Henoch, on West 25th Street, which sustained serious damage in its basement.

But many dealers are looking at a long recovery process that will involve huge expenses and, in many cases, uncertainty about whether or to what extent insurance will cover damage to galleries and artworks as well as lost business days. And the timing could not be worse. Although some galleries are back in business or will soon be, several dealers estimated that the district as a whole will not be fully back to work until mid-December, near the end of the gallery world’s prime selling season, when dealers’ and artists’ fortunes typically revive after the slow summer months.

“In some ways things are not as bad as we first thought,” said Andrew Liss, the assistant director at Gallery Henoch, on West 25th Street, which has showing space at both basement and street levels and sustained serious damage in its basement. “That said, we’re a week into it, and the area still isn’t fully up and running. We have electricity, but no phones or Internet. And everybody is concerned about the long-term effects on business.”

Dealers declined to say what percentage of their annual sales are made in the fall. “If I had a dry computer, I could tell you,” a gallery owner said. But Linda Blumberg, the executive director of the Art Dealers Association of America, described the season as critical. “There’s a pattern of expectation, among buyers as well as dealers,” she said, “that this is the time when people are engaged in making buying decisions.”

Instead, gallery owners expect to spend the next several weeks juggling meetings with restoration specialists, contractors and insurance adjusters. And new problems are cropping up. One dealer said that the contractor rebuilding his space was unable to get to the site early this week because of the gas shortage.

Christiane Fischer, president and chief executive of AXA Art Insurance, which insures many of the galleries, said that her agents had been working the neighborhood since last Wednesday, but that it’s “too early to put numbers on the loss.”

“We’ve sent people out, street by street, to visit clients and make assessments, and brought in teams of conservators and contracted truckers and handlers to bring the art to warehouses,” Ms. Fischer said.

Insurance is a complicated issue for galleries, which require several distinct kinds of policies. Most crucially there is art insurance, which brokers say most galleries carry. According to New York State law art insurance includes flood coverage.

“With galleries there is a lot involved,” said Brian Frasca, the director of fine arts at the Rampart Group, a brokerage that specializes in insuring galleries, museums and private collections. “Does the gallery own the art? Is it on consignment from a collector?” He said costs vary based on the size of the gallery and how much art it has, and he noted that galleries do not necessarily insure for the full value of their holdings, on the theory that even in a disaster a percentage of their inventories may survive.

But art insurance does not cover the galleries themselves — the physical space and its contents beyond the art — or the potential sales lost when the galleries are closed. For that dealers need business and property insurance that specifically includes disaster coverage, which many dealers lack.

“We’ve tried to push our galleries to get that for years,” Mr. Frasca said. (Business insurance carries a heavy deductible. Scott Schachter, a broker at Marsh, a company that insures businesses, said a $1 million policy can have a deductible of up to $500,000 for physical damage, as well as a time deductible of up to 96 business hours — or 12 days — before the lost revenue coverage kicks in.)

Galleries without flood insurance are finding ways to cope.

“With our commercial general liability policy,” said Zach Feuer, the owner of a gallery on West 24th Street, “we’re trying to interpret whether the surge counts as a flood.” If it does, Mr. Feuer will be on his own in replacing the various furnishings and equipment (including computers) of his gallery. But his landlord has agreed to pay for the rebuilding of the space.

Inadequately insured galleries have other options too. On Tuesday, the Art Dealers Association of America announced a program in which galleries in the Zone A, low-lying neighborhoods that could demonstrate that they have been unable to conduct business since the storm, could apply for grants and loans. They need not be members of the association.

Conservators and restoration specialists have jumped into the fray as well, and they have an eager audience: dealers, artists and insurance companies have a shared interest, if for different reasons, in determining what can be saved. When the Museum of Modern Art and representatives from the American Institute for Conservation Collections Emergency Response Team presented a free lecture on the basics of post-disaster conservation on Sunday, MoMA’s auditorium was packed for two sessions.

“Just because something is wet muddy or torn,” said Eric Pourchot, the conservation group’s institutional advancement director, “doesn’t mean it’s not recoverable. That’s one of the messages we want to get out. And instead of walking down 21st Street, ringing a bell and saying, ‘Bring out your wet,’ we decided to get everyone together and see what they need.”

Still, conservators’ services don’t come cheap. Restoration specialists’ fees can be as much as $400 an hour. For artists insurance payments may be welcome, but the loss of work is dispiriting. Sofia Bachvarova, an artist whose solo show at the PVS Gallery in Hoboken was about to end as the hurricane arrived, has spent the past week fretting about what she describes as four year’s worth of work — paintings on canvas as well as sculpture. Neither she nor the gallery’s owner has been able to visit the site, and she worries that even if the work was not directly damaged by the flood, moisture in the walls may affect it.

Other artists have been able to reach a philosophical view.

“So far as I know I’ve lost only one piece,” said David Kassan, who had some paintings at Gallery Henoch, “a painting that’s worth about $24,000, and a couple more were damaged. But I’ve been volunteering in Staten Island, where people lost their homes, and where there’s been loss of life. And in the larger scope of things, what I lost was only a painting.”