SAN FRANCISCO USA ART FUNDING BANKRUPTCY
The Asian Art Museum of San Francisco, one of the largest museums in the Western world devoted to Asian art, has been saved from its impending bankruptcy. The museum’s debtors JPMorgan Chase and the insurer MBIA have been persuaded by the City of San Francisco to restructure the debt.
As the San Francisco Examiner reports, the museum is owned by the City but is operated by the Asian Art Museum Foundation, which borrowed $120 million from JPMorgan Chase in 2000 for renovation and re-installation. According to San Francisco Curbed, the Foundation had refinanced the debt optimistically a few years ago, however the bank recently threatened to force the Asian Art Museum Association into bankruptcy after fund-raising efforts weakened. Sharp allegations from the City followed:
“In a Nov. 30 letter to the bank, City Attorney Dennis Herrera suggested that the bank had given the museum foundation bad advice when it suggested restructuring the debt in 2005 and had ‘already reaped at least $13,000,000 from the foundation in fees and other charges.… I hope that the various and repeated allegations of undisclosed conflicts of interests and self-dealing … are not present here,’ Herrera wrote. ‘But given the various roles played by JPMorgan [with the museum], my office may need to learn more.'”
As city leaders stepped in to help negotiate, the final deal resulted in the bank forgiving $21 million of the foundation’s debt and renegotiating the rate and term of the loan. Mayor Gavin Newsom described the foundation’s financial problems as “a bump in the road in terms of the fate and the future” of the museum, a future that he said “is now significantly secured.”
The Museum then received even more support from the city, reports San Francisco Weekly: “After some serious ‘elbow grease’ the museum’s old debt seems to have disappeared; the bank has forgiven the debt and instead issued it a new $98 million loan.” Furthermore,
Mayor Gavin Newsom and former Mayor Willie Brown have promised to help the museum raise $20 million to help it pay off the new loan. “They said they would open their doors and tap into their circles to help fundraising,” said Tim Hallman, spokesman for the Asian Art Museum.
About Asian Art Museum.
The Asian Art Museum is a home to a world-renowned collection of more than 17,000 artworks spanning 6,000 years. The core of the collection was formed by athlete and industrialist Avery Brundage in the early 20th century when the West was amassing artefacts from China, South Asian and Japan. The collection is housed in a beautiful former library, a building that was later re-purposed and re-designed by Milanese architect Gae Aulenti.
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