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Why THIS ARTIST’S NO-SHOW will hurt Miami real estate

Miami’s Art Week creates a miniature economic boom each year during the first week of December, but like so many things in 2020, that boom has been canceled due to coronavirus. The event, officially dubbed Art Basel, generates about $5 million in revenue for Miami’s iconic Fountainbleau resort in addition to bringing in tens of millions of dollars in economic activity. Art Basel organizers, who are based in Switzerland, say they will return to Miami in 2021.

“It is with great regret and disappointment we announce the cancelation of our December show in Miami Beach, as we know how crucial our show is for our galleries, as well as for the greater Miami arts community and economy,” said Noah Horowitz, director of the Americas for Art Basel, in a public statement. He cited the uncertainty associated with staging large-scale events, quarantine regulations within and outside the United States, and international travel bans as reasons for the cancellation.

The cancellation will not hurt only the hotel sector in Miami. In fact, many commercial spaces are already getting calls cancelling leases on spaces that had been rented to serve as galleries during the event. Residential landlords and short-term landlords are also hurting as artists and attendees back of our their reservations in droves.

“This could be the kiss of death” for many hotels and other related venues, warned president and broker of Apex Capital Realty Miguel Pinto.

Scott Berman, a principle at PricewaterhouseCoopers, agreed that the event will be sorely missed from an economic standpoint as well as a cultural one. “Art Basel represents the genius of creating a demand generator that has become very important to the overall economics of the hospitality industry,” he explained. The loss will affect local developers marketing projects, commercial real estate owners, and small-business owners who manage everything from catering to valet and parking. Art Basel originally filled the slowest weeks of the year in Miami with bustling economic energy, since it takes place during the weeks between Thanksgiving and Christmas. “Not everyone is going to make it to the other side of this,” Berman added.

Art Basel itself has decided to try remote art appreciation this fall. In mid-August, organizers announced two virtual editions that they described as “freestanding, thematic editions”. To show at these events, exhibitors must pay about $5,500 for a digital space. The first of the two shows will run at the end of September. Art Basel announced the new format prior to canceling the Miami event but after announcing it would not host either its Hong Kong or Basel fairs.

Do you think economies that rely on major events like this one can survive coronavirus?

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