The Long and Winding Road

Flush with valuable Lincoln Road real estate and saddled with major debts, the South Florida Art Center ponders its options, its future, and its purpose

"We're real estate rich and cash poor," admits Gilbert, the organization's third executive director in its ten-year history. A 32-year-old nonprofit management consultant and environmental activist, Gilbert moved to Miami from Connecticut last spring, officially taking the reins of SFAC in June. Currently the organization faces $900,000 in mortgage payments. All of its programs operated at a deficit last year; for example, the ClaySpace, a cooperative ceramics gallery, suffered a $20,000 loss.

Even more crucial is the fact that next year Gilbert expects the art center to lose its U.S. Department of Housing and Urban Development funding. Since 1985, SFAC has received annual Community Development Block Grants (CDBG) ranging from $77,000 to $355,000, money used to acquire buildings on Lincoln Road and to subsidize the rents on 90 artists' studios.

CDBG funds, administered by the City of Miami Beach's Department of Development, Design, and Historic Preservation Services, are used to revitalize blighted urban areas by creating jobs, affordable housing, and park and recreation facilities. Along with the grant money comes the stipulation that at least 70 percent of the artists who rent studio space from SFAC be in the low-to-moderate-income bracket, a range based on family size and average area income. (In the greater Miami area, HUD considers "low-to-moderate income" for a two-person household to be $28,550 or less.)

Artists' rents are determined on a sliding scale -- right now $7 to $9.25 a square foot, as opposed to the $25 to $40 a square foot paid by many of the mall's commercial tenants. The rent money amounts to more than one-third of the art center's income, which, together with grants, gallery sales, art class tuitions, and membership fees, supports an annual operating budget of about $900,000.

According to Shirley Taylor-Prakelt, director of Housing and Community Development for the City of Miami Beach, the federal grant money for operation and rehabilitation of buildings was first given to the South Florida Art Center with the understanding that the organization would be self-sufficient by the end of fiscal year 1995-96. "Jane Gilbert will have the opportunity to have a dialogue with the city sometime before next August," notes Taylor-Prakelt, referring to the possibility of continued CDBG funding. "I wouldn't preclude the possibility [that the center will receive additional grants]. But there is evidence of a declining funding allocation to that facility. We've been looking at a more lean budget to make sure that they wean themselves eventually from federal funds." The art center, which received a hefty $355,000 in fiscal 1988-89, has been granted just $157,000 for the current fiscal year.

Gilbert is not particularly optimistic about future federal grants. "It was proposed to the [Community Development Block Grant committee] that the organization would be self-sufficient in ten years," she says. "And now ten years have passed."

Mitigating this darkening financial reality is the fact that the art center owns three valuable street-level properties on the trendy mall: the Sender Building; 800-810 Lincoln Road, which also has artists' studios; and most of 924 Lincoln, a condominium building in which SFAC has set up its administrative offices and houses yet more artists' studios.

"It's hot property," affirms Cathy Leff, who, among her other duties, helps oversee real estate affairs for Mitchell Wolfson, Jr.'s Wolfson Initiative, which recently put the nearby Sterling Building up for sale. "You're going to get a better profit on Lincoln Road real estate than at any time in recent history."

Christine Burdick, president of the Lincoln Road Partnership A a not-for-profit group that manages the mall and rents space in the art center's 924 building A notes that the real estate decisions gripping SFAC are representative of the hard choices facing Lincoln Road in general, which will undoubtedly assume a more commercial flavor when the proposed movie theater and the national retail outlets most merchants and city officials are seeking move in. "How to keep Lincoln Road a cultural center in light of escalating retail costs is a challenge we haven't been able to satisfy yet," Burdick says. "This is a unique district . . . the goal was to get it to a certain point that doesn't necessarily accommodate those that brought it where it is."

Last week's city commission decision regarding the Beach Cinema proposal reignites the question of whether South Florida Art Center should sell its Lincoln Road properties, which are badly in need of repair, or look for other solutions to alleviate its financial straits. Director Jane Gilbert and the center's 26-member board of directors have begun to study possibilities for dealing with the group's cash-flow problems; these include finding a new buyer for any of its three buildings and offering a national retailer a long-term lease on the Sender Building.

"The good news is that we're in a position in which we have assets, and the question is what to do with them," notes Jan Carson Cheezem, a real estate attorney who is the president of the SFAC board. "I think to call it a problem is to pretty much overstate it."

Gilbert is less cautious in her assessment of the situation. "The arts are in crisis in this country, and we are having our own crisis at the art center," she announced at an October 10 meeting to discuss the future of SFAC with members of Miami's arts community. "If we're going to continue to be here on Lincoln Road, we need to either find other funding sources or create a new sense of importance to keeping artists on the Road."

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