Aerial view of Skyspace experience "Ta Khut"
Aerial view of Skyspace experience "Ta Khut" created by James Turrell, in Jose Ignacio. AFP

In a seaside village in eastern Uruguay, well-heeled tourists saunter through a crowded art fair sipping crisp local rose wine as they marvel at the area's burgeoning creative scene.

Between seemingly endless golden Atlantic beaches and undulating grasslands, this remote corner of South America has become an unlikely hub for art, culture, and gastronomy.

Here, in the bucolic countryside, is Uruguay's leading contemporary art museum, galleries, film and photography festivals. And last week, the village of Jose Ignacio hosted the tenth edition of the Este Arte international art fair.

"When we started, most of the people that I talked to thought: 'In Uruguay you cannot do that. We are not like Argentina or Brazil. There will not be enough buyers'," said Uruguayan art curator Laura Bardier.

One of the smallest countries in South America, Uruguay is home to three times as many cows as people, and half of its population of 3.5 million lives in the capital, Montevideo, a three-hour drive from Jose Ignacio.

Nevertheless, Este Arte receives thousands of visitors each year, including amateurs and major art collectors. Artworks fetch prices ranging from $300 to $2.5 million apiece. Most cost around $20,000-$50,000.

Visiting for the first time from New York, neurosurgeon Rafael Ortiz and his pediatric dentist wife Emille Agait snapped up a painting for their home in the Hamptons -- a seasonal hotspot to which Jose Ignacio is sometimes compared.

Agait said she can't wait to tell her art collector friends about the town.

"It's understated, relaxed, but chic and fun. Everybody is beautiful," she gushed.

For decades, Uruguay's eastern city of Punta del Este has been the favored summer location for South America's elite -- its frenetic nightlife and seafront high-rises drawing comparisons to Miami or Monte Carlo.

However, in recent years, those seeking a more under-the-radar sophistication have fled to sleepy villages further east.

Jose Ignacio now boasts eye-wateringly expensive properties in a town made up of a few dirt roads, with excellent restaurants and vineyards nearby.

In the eighties, "Jose Ignacio was empty... only fishermen and local people" lived there, said gallery owner Renos Xippas. Up until a decade ago, the region was "an art desert".

He said people flocked to live in the Uruguayan countryside during the Covid pandemic, seeking out its relative tranquility.

This helped fuel an art boom he describes as revival of "a very long tradition" that died out during the country's 1973 to 1985 dictatorship.

"Uruguayans are very cultivated people and very cool," he said of what has become one of Latin America's most politically and economically stable countries.

"There has been a sort of revolution," said Uruguayan sculptor Pablo Atchugarry, 69, covered in dust from the marble he is shaping. "This space has been the epicenter."

Atchugarry in 2022 opened Uruguay's leading contemporary art museum, MACA, further west of Jose Ignacio: a massive ship-like structure surrounded by a 40-hectare sculpture park in the middle of nowhere.

He describes the area as a sort of Uruguayan Cote d'Azur, attracting a public with "a very high purchasing power and a cultural interest in art."

He and other artists also wax lyrical about its inspirational energy.

"What attracted me was the light, the space, the nothingness and the quiet. I think it's the perfect place to create," said American photographer Heidi Lender who lives even deeper in the countryside in Pueblo Garzon, a tiny former railway town 35 kilometers (21.7 miles) north of Jose Ignacio.

Here she runs a non-profit, Campo, which hosts residencies for artists from around the world.

With less than 200 permanent residents, Garzon is now home to a handful of galleries and a restaurant run by fire-obsessed Argentine chef Francis Mallman, who featured on Netflix's Chef's Table.

But, some, like Austrian art collector Robert Kofler who moved to Jose Ignacio, are concerned that developers will ruin their slice of paradise.

Kofler owns a boutique hotel where he has built an art installation he says helped put Jose Ignacio "on the world map."

He convinced American artist James Turrell to bring to the village one of his Skyspaces -- a dome of pure white marble through which visitors observe the sky at twilight while artificial light twists the perception of its colors.

Kofler says he is constantly fighting off attempts to build beach clubs or high-rises.

"What brings people to fly 12 to 14 hours to come here? It's this beauty and energy and this quietness and slowness. It's getting away from what you know in Saint-Tropez or Monaco or Malibu.

"That's why it's so important to preserve that."