OAKLAND, Calif., Feb. 7, 2017 /PRNewswire-USNewswire/ -- There's an innovative solution for arts and cultural organizations facing displacement in cities and communities across the country—and a new online resource that shows how it works.
Today, the Kenneth Rainin Foundation launched the Rainin Arts Real Estate Strategy website to provide an accessible tool for exploring this cutting-edge approach to addressing an increasingly urgent problem. The collaborative strategy connects resources in the community to the real estate needs of arts and cultural nonprofits.
Shelley Trott, Rainin Foundation Director of Arts Strategy and Ventures, said, "This model is a game changer for protecting our most valued arts and cultural assets, and we're eager to share it with other communities."
Artists and cultural nonprofits are facing displacement at an alarming rate due to rising real estate values in many urban centers, along with city planning challenges and other pressures. Rents in the three US cities with the largest number of artists per capita—San Francisco, Los Angeles, and New York City—are skyrocketing.
The Rainin Arts Real Estate Strategy mobilizes a coalition of public and private partners, who team up to support long-term, sustainable solutions and create affordable, safe spaces for arts organizations. The new website offers a clear window into how the model works, and how it can benefit these nonprofits and the communities they serve. Now gaining momentum in the Bay Area, it makes creative use of existing financial tools to leverage public and private resources as a means to revitalize and sustain the cultural vitality of local communities.
Citing the success of two projects in San Francisco and a more recent initiative in Oakland, Trott is enthusiastic about the potential for this collaborative approach to find similar success elsewhere. "We're discovering what works," Trott says, "and a proven, replicable model like this couldn't be more timely."
At the center of the model is a real estate holding company like the San Francisco-based Community Arts Stabilization Trust (CAST). The first of its kind to serve the cultural sector, CAST is a nonprofit, stand-alone entity that works with multiple partners to purchase real estate on behalf of arts organizations, and to help strengthen their capacity to purchase and manage a facility of their own. Other key partners include a community development financial institution (CDFI), foundations and other donors, banks and other businesses, and local government agencies.
In 2013, a $5 million grant from the Rainin Foundation provided seed funding to create CAST in partnership the Northern California Community Loan Fund—a CDFI with a long history in community development projects.
The Rainin Arts Real Estate Strategy recognizes that the arts drive vibrant and diverse communities and are critical to neighborhood health and well-being. But cultural organizations' current business models do not provide the capitalization, flexibility, and organizational capacity needed to survive and sustain themselves in a rapidly changing real estate marketplace.
Trott described CAST's role this way, saying, "CAST freezes the cost of real estate when it purchases property, carving out an alternative market for nonprofit arts and culture organizations. When a cultural organization buys a property seven to ten years after it's purchased by CAST, it pays the original purchase price."
CounterPulse was among the first pilot projects to secure a lease with an option-to-buy agreement from CAST for their new home in San Francisco's Tenderloin District, which opened to the public in 2016. CounterPulse has raised more than half of their $6 million capital campaign to purchase their home and secure their operations. Once they complete their loan payments and own the property outright, CAST will redistribute the money to another nonprofit arts group in need of help finding a home.
CounterPulse Artistic Director Julie Phelps said, "Our partnership with CAST has enabled our organization to build capacity and contribute to the neighborhood's vibrancy without the threat of displacement. With an additional outpouring of generosity from people and businesses in San Francisco that recognize the value of the arts, we are truly elated to have a permanent home to create art with and for our community."
Shelley Trott agrees, "When we cement the valuable presence of artists and cultural spaces, the entire city benefits. We hope fellow funders, city governments and arts organizations are inspired by our success and explore our website to learn how their communities can leverage this strategy."
Visit the website and download the whitepaper report at: krfoundation.org/artsrealestate
About the Kenneth Rainin Foundation
Kenneth Rainin Foundation is a family foundation that collaborates with creative thinkers in the Arts, Education and Health. At the Rainin Foundation, we believe in taking smart risks to achieve breakthroughs. We support visionary artists in the Bay Area, create opportunities for Oakland's youngest learners, and fund researchers on the forefront of scientific discoveries. Since 2009, the Foundation has awarded over $20 million in funding to support small to mid-size arts organizations in the Bay Area that are pushing the boundaries of creative expression. More at krfoundation.org.
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SOURCE The Kenneth Rainin Foundation