Monday, November 15, 2010

Asian Art Museum in Economic Mess?

Oh no! Maybe it's time to redo the Fung Shui of the site or evoke Ganesh, the Elephant Headed God of Good Luck. I hope that this is not true; unfortunately, as a "humble blogger" I have no access to the real story. When the old library was bought to be turned into the new Asian I was shocked as I thought it was to be an addendum to the new museum. I was disgusted and offended by the ensuing controversy over the Piazzoni murals and wondered about what seemed to the ruthless nature of the (then) management.

I have never liked the location and have always believed that the museum - and the collection - would be better served by a location in Golden Gate Park. A lot of the comments to the original article at SF Gate do mention how unpleasant it is to run the gauntlet of the drunk, disorderly and demented denizens of the Civic Center. It's also disappointing to take the escalators up to the 2nd and 3rd floors and be treated to a bird's eye view of the Tenderloin - that is, when you are not looking down at the gravel roof of the rest of the museum. The Ganesh at the top of the escalator is delightful but the city scape behind him is one of the dirtiest and most crime ridden parts of the city.

I also think that the rooms for the permanent exhibits are too small, too dark and too crowded. It's hard to see even a fraction of the art but I suspect that's also a political decision as well as one necessitated by the historical nature of the building. They could not tear it down and start over so the Beaux Arts columns, the grand central staircase, even the painted and decorated ceilings had to be kept. Another one of the reasons given for moving the museum was to gain more space for the collections and by gum, those collections will be on display. All of them. All of the time.

But as I went to exhibit after exhibit, got to know some of the staff, I began to respect what they were trying to do. I have never had any problems appreciating the beauty of Asian art and culture. Although I feel that it was better displayed in the old location, with the windows overlooking the park, I always find a new treasure to look at and covet. Their publications are marvels of book design and elegant writing. The cafe serves delicious food and their programs are an enjoyable mix of outreach to the younger crowd with plenty of more intellectual lectures for us "older folk." I even like the redo of the balcony where the Piazzoni murals used to be!

I will be following the story as best I can as I think the Asian is a beautiful, world-class museum with a marvelous staff, great programs and beautiful art. Ganesh deserves better; we deserve better and most of all, the Asian deserves a generous deal from its donor base (any Asian billionaires out there?). Somebody also needs to whip down the pit bulls of the banking industry. Haven't they gotten enough? For us to lose this jewel would be crushing.

San Francisco's Asian Art Museum is in dire financial straits and could be forced into bankruptcy if it can't work out a new deal with its lender by Friday, according to knowledgeable sources.
Our sources say the troubles started in 2005 when the museum's directors, hoping to hedge against rising interest rates, restructured $120 million worth of loans to try to save millions of dollars. But now rates have hit rock bottom, and their lender, JPMorgan Chase, says it plans to close the Asian Art's line of credit as of Friday - in which case, the museum would lose $20 million that it put up in collateral.

That money reportedly is insured, but one source following the developments said losing the collateral would nonetheless spell calamity for the museum. It would still be on the hook for the $120 million in loans, but the repayment timetable would be sped up to five years from now. We're told the museum's current endowment amounts to just $60 million.

"They could only keep up with the payments for maybe a year or a year and a half before they would have to close their doors," said the source, who spoke on condition of anonymity because he is not cleared to discuss the negotiations publicly. The museum's directors have hired bankruptcy lawyer Bruce Bennett - who helped restructure Orange County's $10 billion debt a few years back - to try to buy the museum extra time to turn around its finances.

Asian Art reps also plan to huddle with Mayor Gavin Newsom's people today in hopes of getting help with another line of credit. However, one city rep, speaking on condition of anonymity, said, "Nobody is using public money to bail them out."

It's quite a reversal of fortune for the museum, which relocated to the restored old main library in Civic Center in 2003 with the help of a $42 million city bond measure. According to its board minutes, the museum had a balanced budget as recently as June 2009 and was racking up record attendance.

Since then, however, attendance has fallen sharply and the place hasn't seen any donor gifts in a couple of years. Even a ballyhooed exhibit to coincide with the opening of Shanghai's world trade expo in May failed to draw the anticipated crowds. (I wrote several posts about this exhibit. I had some criticisms of it but it was still well worth seeing and every time I went, the galleries were full of people.)

The museum's management did not return our repeated calls seeking comment, and board directors we spoke with either appeared to be in the dark or weren't talking.

"I'm not in a position to give you the information you are looking for," said Robert Duffy, vice president of the Asian Art Museum Foundation. Bennett, the bankruptcy lawyer, did not return our calls. A spokeswoman for JPMorgan Chase promised to look into the matter late Friday, but did not get back to us by deadline.

Read more:

If Brown's column is correct, the management at the Asian angered Larry Ellison. He offered them a substantial donation but they turned him down, stating that they wanted their donor "face" to be Asian. Not a smart move for when they later needed more money, there was no way Larry would fork it over.


Zoomie said...

Frankly, if that Ellison story is true, they don't deserve to be running a museum at all, much less one with collections as spectacular and important as those at the Asian. That's truly shocking - and racist, by the way!

namastenancy said...

I agree with you about Ellison but that was the previous management. I can't remember the name of the lady who was in charge at the time but she had a reputation of being a real Dragon Lady. IMHO, she also negated or didn't give Avery Brundage enough credit and his collection was the foundation for the museum. But that has been rectified with the current management. Plus, well, who other than a real financial pundit could have foreseen the current financial mess?

Zoomie said...

Because the financial world is always so risky (stocks, bonds, futures - all of that stuff is speculative and not a whole lot different than rolling the dice at Las Vegas), good management of funds doesn't include making chancy moves with the endowment. There's a reason why such institutions are usually very conservatively run - they are sensibly risk-averse. Sadly, the board at the Asian took a chance and, ooops! now we may have to CLOSE???