The Chelsea Art Museum in New York could face the loss of its charter following the news that its entire permanent collection of artwork had been pledged as collateral for a loan needed to pay its mortgage. Founded and directed by Dorothea Keeser, the eight-year-old contemporary art museum has faced ongoing financial difficulties, with Keeser struggling to pay the mortgage on the 30,000 square foot building on West 22nd Street.
Keeser acknowledges being aware of museum charter regulations, but defends her actions – emphasizing that she has been able to avoid selling art from the collection thus far by finding other ways to raise funds for the mortgage. The permanent collection includes paintings and prints by abstract artists such as Jean Arp, Sam Francis, Joan Mitchell, and Robert Motherwell, and is worth $2.5 million according to Keeser.
A separate company owned by Ms. Keeser bought the museum’s building and now owes Hudson Realty about $13 million. The museum’s permanent collection was pledged as collateral against a separate, $350,000 loan from unnamed lenders completed this March in order to pay the interest on the original mortgage. However, as recently as this week Ms. Keeser informed Hudson Realty that her company has declared bankruptcy. Agreeing to pay rent on the building has allowed Keeser to continue museum operations there as normal and she remains hopeful that the museum can still be persevered, in part by developing its roof as a high-end restaurant.