The sale to Curtis of UArts’ Art Alliance building gets court approval
But the proposed sale of the Arts Bank building was put on hold after the state objected.
The Curtis Institute of Music will be permitted to purchase the Art Alliance building owned by the shuttered University of the Arts after the agreement was approved Wednesday afternoon in bankruptcy court in Wilmington.
Curtis successfully bid $7.6 million for the building, which is close to the school on the east side of Rittenhouse Square, during a live auction Tuesday held by UArts bankruptcy trustee Alfred T. Giuliano. Bankruptcy Judge Brendan L. Shannon noted during the hearing there were no objections to the sale.
It is the first of nine buildings to be sold as university assets wind their way through bankruptcy following the abrupt June closure of the school. The attorney representing the UArts bankruptcy trustee said there are secured claims of approximately $67 million.
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But the proposed sale of the Arts Bank to Quadro Bay LLC garnered more scrutiny as the state objected to its bid, arguing that the building should continue to be used for charitable purposes.
The Pennsylvania Attorney General’s Office had raised a similar objection to the Art Alliance building sale when real estate mogul Allan Domb had the top bid. (Domb did not bid during the live auction.) The attorney general’s office cited a restrictive covenant from when the alliance and UArts merged that said the building had to be used for education and exhibition purposes.
Christopher Momjian, a lawyer for the attorney general’s office, said in court that the state no longer objected to that sale given the building was going to the nonprofit Curtis, which outbid Temple University during the auction.
A lawyer representing the UArts bankruptcy trustee, however, contended that there was no such restrictive covenant on the Arts Bank building.
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“The trustee has a fiduciary duty to maximize value for all creditors,” the lawyer argued.
The judge said he needed more information to determine whether the proposed sale of the Arts Bank to Quadro Bay should be approved. Another hearing will be held next Wednesday.
At the live auction, Quadro Bay outbid the Lantern Theater Company for the Arts Bank, at 601 S. Broad. The winning bid was $2.71 million. Lantern had initially bid $1.76 million.
During the court hearing, Damien Tancredi, a lawyer representing Quadro Bay, said his client intended to use the building for residential purposes above the ground floor and possibly commercial on the ground floor.
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Hearing of the state’s objection to the Quadro Bay sale, Charles McMahon, artistic director of Lantern, said in a statement: “Lantern Theater Company remains deeply interested in moving to the Arts Bank and preserving this important cultural asset for artistic and educational programming.”
The Arts Bank officially opened Jan. 18, 1994. It once housed the South Philadelphia National Bank, and, after the bank closed, the building was home to various businesses and occasionally hosted rock concerts. The acquisition and renovation of the building in the 1990s were financed by the William Penn Foundation, which provided $2 million for land acquisition, planning studies, and operating funds, plus $3.6 million for renovations, according to a 1993 article in The Inquirer.
The Arts Bank was the first new project in the redevelopment of South Broad Street into the Avenue of the Arts, which eventually grew to include the entirely new Kimmel Center and new buildings for the Clef Club, the Wilma Theater, and other groups.
Exactly what Curtis will do with the Art Alliance remains to be worked out, as does the cost of any needed renovations, a spokesperson said Tuesday. But with the acquisition, the school might shuffle around space in its current buildings on Locust Street and move some of those functions into the Art Alliance.
The building at 251 S. 18th St. includes a small performance hall, exhibition galleries, and some outdoor space.
Curtis’ purchase is being made possible by gifts from trustees and other supporters, many of whom pledged their support in recent hours and days. The school, considered one of the top music conservatories in the world, is celebrating its centenary this season.
Staff writer Harold Brubaker contributed to this article.