Academy Museum Delayed as Costs Grow
The opening, which was slated for mid-2017, has been pushed to spring 2018 as a bond offering gets underway and chief fundraiser Bill Kramer announces his pending departure.
A version of this story first appeared in the Oct. 16 issue of The Hollywood Reporter magazine. To receive the magazine, click here to subscribe.
A new date has been set for the opening of the Academy's long-planned movie museum: Once promised for mid-2017, it now is slated for spring 2018.
While the Los Angeles City Council voted to approve the controversial project in June, building permits were delayed until the Academy reached a September settlement with the community group Fix the City, which had threatened to sue until the Academy promised to reduce some signage and develop a plan to monitor traffic and noise. "When the City Council approved the project in June, at that point if we were able to start construction, it would have kept us on track for late 2017. But it took a few months to work with the community group, and I have to say it was time well spent,” says Bill Kramer, who as the museum’s managing director of external relations has served as chief fundraiser while also shepherding the project through the approvals process. “We have a great relationship with Fix the City now, and we’re really happy with the settlement agreement. That slight two-month delay pushed us into the spring of 2018.”
With building permits finally in hand, demolition work is beginning at the old May Co. Streamline Moderne building at Fairfax and Wilshire.The first order of business is the removal of a 1946 addition to the 1939 building, which will return its exterior to its original look. Construction on architect Renzo Piano's ambitious design for the 290,000-square-foot museum will then begin in March.
Some elements that were not originally envisioned have been added to the project, including methane mitigation. “We decided to put in more mitigation work into the foundation of the building than we needed to do," Kramer explains. "That means we will never have to go back in and do any sort of creating of a barrier and protective layer to stop any methane leakage in the building. We didn’t have to do it now. The building is in good enough shape that we could have waited 30 to 40 years to do that. But we decided to do it now, which is actually more cost-effective."
Kramer adds, "From March until right now, we've been doing prep work on the building, and it's been smooth sailing. We did not find any unexpected issues to the building or the lot." Some asbestos has been removed from the building, "but that factored into our prep work for demo and construction, and all asbestos has been completely removed," Kramer says.
Structural tests have also been completed in preparation for erecting the sphere-shaped addition that will house a 1,000-seat theater, Kramer continues. "Over the last six to eight months, as we’ve finished the design, we’ve done structural testing on site, but that was just to ensure that the weight of the sphere and the structure of the sphere could be held in place, and it can. So no major design changes had to take place at all."
Meanwhile, on Oct. 6, the Academy kicked off a $349 million tax-exempt bond offering so that it will have funds on hand for construction while pledges to its capital campaign come in. Two series of bonds are being sold by Wells Fargo Bank. The first series, offered at a fixed rate, is looking to raise $221 million, and the second, at a variable rate, is for $128 million. The funds will be used for financing the museum and also for the refinancing and reimbursement of previously paid costs.
The bond offering, which received top credit ratings from Moody's and Standard & Poor's, is described as a common method used by cultural institutions to fund the construction of new projects while fundraising is ongoing. The Academy last issued bonds in 2002 when it was building its Pickford Center for Motion Picture Study on Vine Street in Hollywood.
According to the bond filing, $288 million has been set aside for acquisition, construction, furnishing and general development, but the Academy declined to break that number down further.
This summer, the Academy's board of governors also quietly approved raising the goal of the museums' capital campaign from $300 million to $388 million, which, Kramer explains, includes $50 million that is now being set aside for exhibitions and programming. "It has a lot less to do with bricks and mortar and more about creating really expansive and immersive exhibitions and programs within the museum, and then arriving at some contingencies just to buffer the budget and give us a little bit of flexibility. That additional amount is tied to that expansion," he says.
The offering noted that as of August, the capital campaign had received $215 million in commitments and is looking to reach its full goal by December 2017. Since August, Kramer says, the Academy has received another $24 million in commitments as well as a further $11 million in verbal pledges for a total of $250 million.
Of those commitments, $62 million had been received by the Academy as of August and converted into cash. "This early on, having that much cash on hand is fantastic," Kramer says. "The good news: Since that time, we've received our first round of big pledge payments on some of the major naming gifts. Their giving was tied to the start of demolition, so now you're going to see a big uptick in money coming in."
Ongoing discussions have also been taking place between museum director Kerry Brougher and members of the Academy's board and its museum committee about the types of exhibitions that the museum will showcase once it opens. While some outside observers have questioned how the museum will strike a balance between popular attractions that will bring in tourists and more academic approaches that will appeal to film scholars and connoisseurs, Brougher cautions against assuming that the museum will take any one direction. "I should preface it by saying that the museum is quite large and has lots of different spaces for different kinds of exhibitions," he says. "So it’s not just one thing. It will be a lot of different kinds of experiences, a lot of different kinds of sequences taking place as you move through the museum. But I can say that my conversations with the board of governors have been very pleasing. They’ve been very open to progressive ideas. They’ve been very open to different kinds of experiences. We’ve had great brainstorming sessions at which a lot of innovative and creative ideas have been kicked around. Overall I would say it’s really been a very productive working relationship."
He continues, “We are in the middle of working on what I call the historical exhibition. We are fairly well along on the conceptualization of that. In terms of temporary exhibitions, there are several that we are looking at right now that we will actually create ourselves, but we are also talking to other film museums and institutions to bring in shows as well and to send our shows out there to them. We are working on both things simultaneously.”
Even as the project gets underway, though, Kramer, who has been a key figure in launching the project, working closely with Academy CEO Dawn Hudson, has informed Academy officials that he plans to leave in December to take a new position as vp institutional engagement at the prestigious Rhode Island School of Design.
“Leaving the Academy museum project was a very hard decision for me to make,” Kramer says. “I’m able to do it for a couple of reasons: We’re far along with the original capital campaign, and we’ve moved the project through public approvals. Signing that settlement agreement was the last step in the process.” Adds Brougher, “I’m absolutely sad to lose Bill, but I know this is a major opportunity for him. I’m so grateful to him for getting us so far along with this project. I don’t think this will be a setback. I think we’ll stay on schedule.”