Circle Fine Arts Regroups

Chicago’s small galleries are reeling in the wake of the art market’s collapse, but so are the behemoths. Circle Fine Art Corporation, a publicly traded and unabashedly commercial Chicago-based chain of art galleries and related subsidiaries, is undergoing a substantial restructuring. Chief among its concerns at the moment is refinancing some $18 million in loans about which the primary lenders–Standard Chartered Bank and Chrysler Capital Corporation–are growing increasingly nervous. “We’re in discussions with the lenders about the matter right now,” Circle Art chairman Jack Solomon said last week. “When the loans were made, we were much more optimistic about the art business.”

Recent developments have considerably tempered Solomon’s optimism. He says Circle stock, traded over the counter, now fluctuates between 1/2 and 1, after peaking two years ago at around 10 1/2. The company’s revenue for fiscal 1991, which ended last September 30, dropped to $36 million from $41 million the year before, putting the company $3 million in the red–the first time it’s lost money in its 28-year history. Solomon predicts another substantial drop of around 20 to 30 percent in fiscal 1992.

Since it became apparent that the art business’s downward spiral wasn’t going to be short-lived, Circle has tried to downscale its operations. The chain’s staff has shrunk from 450 to 290. Over the past few months the company has closed three unprofitable galleries, in Maui, La Jolla, and Washington, D.C., leaving a total of 32 stores. Solomon has closed three test stores for a new subsidiary called Tangents, which carried a range of utilitarian art including clothing and utensils, and the company kissed good-bye a test joint venture with Bulova selling artist-designed watches. “It was the wrong time for that,” says Solomon. Another drain on Circle operations is its wholesale division, which sells artwork to a number of beleaguered galleries around the country. “The wholesale business is going nowhere,” Solomon says.

Though it’s been a tough couple of years for Circle Fine Art, Solomon is another of those dealers who believe the correction in the market was inevitable. “The market was overinflated,” he says. “It had to adjust itself.” In the last couple of months, Solomon has seen the first signs of better days. “December and January were the worst,” he says. February was not too bad, and March was better than February.”

Will Anyone Buy the Lakeside Group?

Chicago International Art Exposition founder John Wilson wants to sell his company–sort of. Wilson has circulated a prospectus on his business, the Lakeside Group, but has set his asking price so high he doesn’t think anyone will bite. Nevertheless, “Six or eight prospective buyers are considering it right now,” he says. One group he’s been talking to is the Kennedy clan, who control the Merchandise Mart, but apparently nothing has come of that discussion.

In addition to Art Expo, the Lakeside Group produces the annual New Art Forms Exposition and boat and antique shows. But only the Art Expo makes money, Wilson says, and most of that has been poured back into the company in an effort to put the other shows on a firmer financial footing. “Who would want to buy a company like that?” he asks. A source in the art business said Wilson’s asking price is around $16 million, but Wilson said it is more than that.

How to Hire a Choral Director

Margaret Hillis, director of the Chicago Symphony Orchestra Chorus, announced long ago that she’s leaving for good next season, but dont look for the CSO to announce her replacement anytime soon. Joyce Idema, the symphony’s head of marketing and public relations, said the chorus will engage a series of guest directors next season. The guest directors’ work with the chorus will apparently serve as a test of their worthiness to fill Hillis’s shoes, though Idema emphasized that the CSO could end up not choosing any of them. At least one longtime CSO musician questions the wisdom of a protracted search for Hillis’s successor. “Normally when someone announces they are leaving, you have someone in mind to fill the slot.” But Idema insisted the lengthy selection process is necessary. “Margaret Hillis was here for 35 years, and in this instance the right match is the most important factor.”

The Work Behind A Slip of the Tongue

Steppenwolf Theatre had no trouble selling tickets to its recently closed production of Dusty Hughes’s politically themed play A Slip of the Tongue, starring ensemble member and movie star John Malkovich, absent from the Chicago stage for five years. But critical reviews of the Steppenwolf production prompted Hughes and director Simon Stokes to spend considerable time rewriting the script and rehearsing the changes with Malkovich and the rest of the cast after the play opened. Now it’s scheduled to reopen mid-May in London, where Malkovich is a popular marquee draw, and a week of rehearsals has been added to the schedule there to work in all the changes. Even with the rewrites and Malkovich’s popularity, A Slip of the Tongue faces a tough uphill battle given the recession that has curtailed theatergoing in Britain.

Alpine Valley’s New Operator

The troubled Alpine Valley Music Theatre in East Troy, Wisconsin, will have a new operator this summer: the team of Sony Music and Pace Entertainment. The theater’s former operator, the Milwaukee-based Joseph Entertainment Group, has declared chapter 11 bankruptcy and is said to be reorganizing. A court-appointed trustee chose the Sony/Pace partnership to operate the facility for the upcoming summer season, though new general manager Fran Macferran said the arrangement could wind up becoming permanent. Macferran said Sony/Pace plans to book everything from classical to Van Halen. Sources say Alpine Valley will probably compete most directly with Poplar Creek Music Theatre in Hoffman Estates, owned by the Nederlander Organization, though Macferran believes the Chicago market is large enough to support all of the area’s outdoor venues. Sony has been managing concert venues with Pace since 1990; Pace owns and/or operates eight other outdoor venues, most of them in the south and southeast.

Art accompanying story in printed newspaper (not available in this archive): photo/Steven D. Arazmus.