Pace Gallery Seeks Tenant for Part of Its Chelsea Headquarters

Pace Gallery is looking for a tenant to take over part of its eight-story Chelsea headquarters at 540 West 25th Street, the latest step in an apparent effort to trim costs after a major restructuring earlier this year.

Julie Davich first reported the news in her newsletter The Appraisal, writing that Pace was seeking to lease space inside the building.

A Pace spokesperson confirmed to ARTnews that the gallery is exploring bringing another tenant into the building, and emphasized that the move would not affect its exhibition spaces.

"Given the size of our building, we are exploring opportunities for a tenant to occupy a portion of our space to share in the operating costs," the spokesperson said. "This space is not part of the gallery's public areas and is not used by artists, collectors, or visitors, so there will be no impact on our exhibitions, programs, or visitor experience."

The building carries a considerable expense. The Financial Times reported that its rent is said to be $9 million annually — a figure CEO Marc Glimcher neither confirmed nor denied when the restructuring was announced in June.

At that time, Glimcher told the FT that the gallery remained committed to its New York headquarters despite the cost. He described the building as a product of a very different art market. "That building was what I call a 2015 decision," he said, referring to the art market's frothiness when the headquarters was first planned. While he said the building would not be easy to subdivide, he noted that it had "a lot of office space, so we shall see."

Glimcher had already suggested a space-sharing arrangement might be on the table. The gallery's new statement makes that possibility considerably more concrete.

The Chelsea flagship, designed by Bonetti/Kozerski Architecture and completed in 2019, was conceived at the height of the mega-gallery expansion era. Davich noted that the building cost roughly $100 million to construct, with developer Weinberg Properties paying for the shell; Pace reportedly spent another $18.2 million on the interior build-out.

The tenant search comes several months after Pace launched a broader overhaul of its business. In June, the gallery cut more than 50 artists from its roster, eliminated 50 staff jobs and reduced its workforce by about 20 percent. Glimcher was unusually frank about the reasoning. He told ARTnews that the goal of the restructuring was "to break the…self-reinforcing cycle of rising costs and rising prices" and return to the gallery's roots.

Real estate has been part of that recalibration from the beginning. Pace put its 8,600-square-foot Hanover Square gallery in London on the rental market and began searching for a smaller London location, with Glimcher saying he wanted something "less corporate."

Finding a tenant for unused office space in Chelsea would extend the same strategy: keeping Pace's major public-facing presence intact while reducing the cost of infrastructure built during a far stronger art market.