In New York City today, there is a highly concentrated population of art galleries in Chelsea. This neighborhood, recently overwhelmed by the influx of art galleries and artist cooperatives, is the largest single art gallery community in the world. Yet this area did not grow up slowly and develop with the artistic community which it supports. It emerged suddenly, almost violently, on the art scene, pulling galleries and dealers from their previous homes in the Soho district to the south.
Any gallery wanting to stay in "the scene" needed to make the move along with their colleagues and nemeses to remain a part of the hip and burgeoning NYC art scene which has historically been concentrated in one place - despite the fact that this location is periodically shifting. One might think then that this shift was produced on a whim by a prominent gallery or artist who moved to Chelsea and brought with it a landslide of followers and an epic exodus. The reasoning behind the Soho-Chelsea shift is more complicated than that and has its roots not only in the reputations of the galleries making the move, but also the living situations of the artists creating the work, the influx of culture brought on by an artistic community, the real-estate values as effected by cultural appeal, and the gentrification of Soho. 
Soho, though not the first of the concentrated artistic communities in New York, was the most recent. In the 1980s the art bubble exploded. Art auctions sold pieces for unexpected highs, galleries were flourished and many opened, and artists began to move to Soho where they could live and work together in a place with low rent when the upper east side became too expensive. For artists, it is important to stress that while competition and monopoly are assets in other fields, communities and cultural cohesion are important factors for thriving art scenes and work. In Soho, artists often worked where they lived, producing artwork within a community of other living and working artists. Galleries took note of this trend and flocked to this area. Rents were cheap at first, so many galleries and cultural institutions opened their doors. With the artists came the art scene, a cultural mix of hip restaurants, shops, galleries, etc. With the art scene came people to see the galleries, to eat at the restaurants, to shop at the boutiques.
As the area started to develop a reputation as a destination rich in intrigue and culture, its symbolic value as a living environment increased. As its symbolic value increased, the demand and, by economic laws, the rent went up too. Unfortunately rocketing rental prices for work and living places meant that artists who could not afford the increased prices when the rents went up were replaced at the end of their leases by new buyers. The same factors that had drawn so much attention to the area were being replaced by young professionals and commercial shops by the mid-1990s. High end fashion emerged in Soho as a response to the money flowing into the region, and suddenly the artists who had helped to make the place grow could no longer afford to live there. But it wasn't only the artists that moved. 
Shopping Map of SoHo in 2005
The galleries began to be forced out too, and in response they moved to Chelsea where the rents were still low and the spaces were larger and more available. In Soho, the rents were growing rapidly. It is assumed that if the galleries were selling lots of art to the rich people moving into SoHo that they would be able to sustain themselves even if the artists moved away. But with the market recession in the 1990s, art was selling for less than it had in years and galleries were struggling to keep doors open. The move by a few prominent galleries was enough to begin a whole exodus. Many galleries moved because they could not sustain rents. Some moved because others were moving and a gallery scene is improved by the presence of many galleries in a concentrated area to draw people like a tourist attraction. Art scenes and gallery presence are not the strange places, the bohemias, of the past but new cultural forms which are desired by cities and populations as proving a certain amount of "economic vitality". Others stayed and tried to weather the storm, only to be overshadowed by the now infamous Chelsea art scene. Many feel that this Chelsea art scene may last forever, but they felt the same about SoHo not long before that. It would seem that memories are short for speculators and dreamers alike.