June 5 (Bloomberg) -- Art Basel Director Samuel Keller, who steps down this year as head of the world's biggest contemporary fair, has some advice for his successor.

``Change continuously with the art world,'' Keller, 41, said in a telephone interview from the Swiss city. ``Listen to the galleries who have what it takes to make an art fair.''

Art Basel's concrete plaza of low buildings opens once more from June 13-17. Eli Broad and hedge-fund manager Adam Sender's curator Todd Levin will be there. So will 300 dealers including Larry Gagosian and Doris Ammann -- pitching art from Pablo Picasso to Damien Hirst.

As many as 56,000 visitors are expected to spend about $500 million, according to Art Basel spokesman Peter Vetsch, the first time organizers have given a sales estimate for at least three years.

Keller, who wears black and shaves his head, has directed the fair since 2000, taking it through a dip in fortunes after terrorists destroyed the World Trade Center in New York. He launched the sister fair Art Basel Miami Beach in 2002.

Next year, Keller will move to the Fondation Beyeler, joining the private museum near Basel after a boom in demand for contemporary works tripled or quadrupled auction records for Mark Rothko and Andy Warhol last month in New York.

His successor will be named at the Basel fair, which starts with a party hosted by Mark Booth, chief executive officer of NetJets Europe Inc., owned by Warren Buffett's Berkshire Hathaway Inc. A preview follows the party.

Twombly, Peyton

Hot artists at the show include Ed Ruscha, Cy Twombly, Tom Friedman, George Condo, Elizabeth Peyton and Jim Lambie, according to a poll of three U.S. hedge-fund managers. Artists who feature at the Venice Biennale, which starts this week, including Tracey Emin, Sophie Calle and Felix Gonzalez-Torres, are also in demand.

``Galleries are doing very well,'' said Keller. ``But the high numbers don't reflect the whole market.''

While an Andy Warhol car-crash picture fetched more than $70 million last month at auction, new works by John Baldessari can be bought for $250,000 and pieces by many young artists cost $20,000 or less, collectors said.

Hedge-fund managers will be outnumbered by entrepreneurs at Art Basel, Keller said. Some groups of Chinese buyers are coming for the first time and there are rising numbers of Russian and Middle Eastern guests, he said.

As new buyers flock to Basel, some dealers will hang older or more flamboyant art on their stands and sell young artists' best new works out of backrooms to well-known customers, collectors said.

Los Angeles to Guangdong

Some stalls will tend to display works that are ``more easily consumable and understood,'' Keller said. ``But we also have more galleries presenting challenging works. This year we have 26 one-person shows of young artists.''

Berlin's Bernd Ribbeck, Zheng Guogu from Guangdong Province in China and Kerry Tribe of Los Angeles are among the 26 young guns, most of whom were born in the 1970s.

The fair's 38th edition also introduces ``Art On Stage,'' a performance space with an inaugural show by Thailand's Rirkrit Tiravanija. ``Art Unlimited,'' a hall of larger works introduced earlier by Keller, is more like an exhibition and ``not as commercial'' as the main fair, Keller said.

Some 800 galleries applied to exhibit at Art Basel this year, about the same as in 2006, said spokesman Vetsch. Gagosian, Robert Mnuchin's L&M Arts, Karsten Greve, Annely Juda, Max Hetzler, Robert Landau, Jan Krugier and Gmurzynska are among the galleries that took the largest stands, 124 square meters (1,335 square feet), Vetsch said. Stand prices rose to 482 Swiss francs ($394) per square meter, from 450 Swiss francs last year.

Venice Biennale

Art Basel comes between New York's $1.4 billion May impressionist, modern and contemporary art auctions by Sotheby's and Christie's International, and their June sales in London, which have a high estimate of $852 million before commissions.

The run-up in prices has revived collectors' memories of the bubble in the 1980s. The effects of 1987's stock-market crash filtered down to the art world by 1990, causing the value of the top 10 percent of contemporary works to drop by half in the following six years, according to index maker Art Market Research.

Art Basel this year overlaps with both the Venice Biennale and the five-yearly Documenta show in Kassel, Germany.

``It's a stellar constellation,'' Keller said. ``A lot of artists are working to have art in these exhibitions in Kassel and Venice, and artists shown in Venice will have work in Basel. For us, it means a clear increase in the number of overseas collectors.''

No Mausoleum

Sales at the Maastricht fair in March, which concentrates more on Old Master works, were probably about the same level as those expected at Basel, according to insurers. Art Basel Miami Beach has the third biggest total, said fair directors including Art Cologne's Gerard Goodrow.

Zurich-based UBS AG, Europe's biggest bank by assets, is Art Basel's main backer.

Keller declined to elaborate on his plans for Ernst Beyeler's foundation.

``He wouldn't have taken a young guy like me if he'd wanted the museum to be a mausoleum,'' Keller said.

To contact the reporter on this story: Linda Sandler in London at lsandler@bloomberg.net.

Last Updated: June 5, 2007 04:05 EDT