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December 24, 2002

Retrenching Guggenheim Closes Hall in Las Vegas


The Guggenheim Las Vegas, a soaring exhibition hall that opened just 15 months ago to the roar of a celebrity motorcycle cavalcade, will go dark on Jan. 5 for an indefinite period while the Solomon R. Guggenheim Museum in New York looks for a sponsor for the hall's next exhibition.

The temporary closing of the boxlike space designed by Rem Koolhaas, which is in the Venetian Resort-Hotel-Casino, puts the Guggenheim's shrinking ambitions in perspective as New York's most flamboyant museum undergoes a severe retrenchment.

"We are working on securing funding for our next exhibitions," said Lisa Dennison, the Guggenheim's deputy director. "Until we are in a state where we have the right show and the right sponsorship, it will remain closed."

In the last year the Guggenheim's operating budget has constricted drastically, followed by an equally dramatic reduction in staff, to 181 full-time positions from 339 in November 2001. In all, 102 people have lost their jobs through layoffs, including 23 this spring, when the New York museum cut its operating hours. Attrition and resignations account for the rest, museum officials said.

Last month the museum's prime benefactor, Peter Lewis, an automobile insurance magnate from Ohio, came to its rescue with a last-minute infusion of $12 million, just enough to start 2003 with a balanced budget. But the money came at a price: Mr. Lewis put the museum's director, Thomas Krens, on notice to either live within his means or start looking for another job.

With its operating budget down to $24 million half what it was at the end of the 1990's the Guggenheim has already learned to make do with less. Its exhibition schedule for the coming year includes two shows that were postponed from 2002 a long-anticipated solo show by the New York artist Matthew Barney, which is to open in February and run until May, and an exhibition of works by the Suprematist artist Kasimir Malevich, which is to run from May until September.

Some of the museum's operations its educational division, for instance have emerged from the cuts relatively untouched. But for the most part, the pain has been spread across the museum's departments, from technology to corporate relations, museum officials said.

Yet they also insist that the Guggenheim is now at the size that suits it best.

"The discouraging thing is that the focus has been on the reductions in spending and the reduction in force, which have been significant and stressful," said Judy Cox, deputy director for external relations. But referring to what she said was a leaner operation, she added, "That makes you lose sight that in fact the institution is much stronger, and the programming is lively and interesting."

Hardest hit have been the museum's off-site ventures, which in a more boastful period were the stuff of the Guggenheim's far-flung ambitions. First to close was the SoHo branch, which shut its doors late last year. Next went the lavish offices of the Guggenheim Foundation the core of the international empire near Grand Central Terminal.

In the last few months the Guggenheim's Internet venture, a private company known Guggenheim DotCom, has officially turned into "vaporware," the computer industry's term for promised products that never materialize or, in this case, literally vanish from cyberspace.

Begun in the spring of 2001, Guggenheim DotCom was going to unite on one Web site works not only from the Guggenheim's collections, but also from the Hermitage State Museum in St. Petersburg, Russia, and the Kunsthistorisches museum in Vienna, two museums that have also been its partners in Las Vegas.

In its giddy heyday, the Web operation was attractive enough to draw $20 million in investments, which helped cover an estimated $5 million royalty fee that was paid by the dot-com to the museum for the right to reproduce its artworks digitally. "It was a very interesting idea that attracted $20 million, and it didn't work," Mr. Lewis said. "It was also very good for the Guggenheim."

But more than any other project, the Las Vegas venture consisting of two separate museums inside the Venetian, smack in the middle of America's gaudiest playground somehow came to symbolize Mr. Krens's dreams and schemes. Opened in October 2001 with a party that attracted Guggenheim supporters from all over, including Russia and Hollywood, the project got off to a heady start.

In a statement issued by the Venetian recently, Robert G. Goldstein, the hotel's president, noted that nearly a million visitors had come to the museums since they opened. "We look forward to continued growth and future cultural endeavors that will please and delight our patrons," the statement said.

Mr. Goldstein was not available for further comment, but according to the Guggenheim's financial statement for 2000 and 2001, the Venetian which paid for the construction costs for both museum spaces and for the initial installations has yet to be reimbursed for the cost of installing the "The Age of the Motorcycle," an exhibition that has been on display in the larger of the two museums since it opened. Estimated at several million dollars, those expenses were to be covered by any surplus revenue generated by admissions and sales at the museum, Ms. Cox explained. So far, she said, no surplus has been generated.

As it continues to look for a sponsor for the next show in the larger Las Vegas museum space, the Guggenheim is also tinkering with the mix at the smaller museum, clearly looking for ways to draw bigger crowds.

The first two shows exhibited masterpieces from the Guggenheim, the Hermitage and currently, from the Kunsthistorisches, while the next exhibition, with a working title of `'American Pop Icons," is to focus exclusively on modern American art, drawn mostly from the Guggenheim's collection.

Another future show, now under negotiation, is to exhibit works by Norman Rockwell, a crowd pleaser. Also under consideration is an thematic exhibition that would illustrate "The Pursuit of Pleasure," as shown in paintings with scenes of feasts, country picnics and, not surprisingly, various types of gaming.

So far, however, "disappointing" is the word most often used by Guggenheim officials for the Las Vegas experiment, although they quickly add that the period has been marked by a nationwide slump in tourism. They also note that their relationship with the Venetian continues to undergo modifications.

"These were unusual arrangements," noted Mr. Lewis in a telephone interview, "but they don't present problems."

With its successful satellite museums in Berlin and Bilbao, the Guggenheim remains a global player despite its spate of financial difficulties. Negotiations continue for a Guggenheim museum planned for Rio de Janeiro, and the city is still committed to paying the costs of construction up front, estimated at $120 million, according to both Brazilian and Guggenheim officials.

Although the details of the agreement have not been made public, news reports in Rio suggest that the Guggenheim in New York can expect another boost from the Rio project, much like the one it received from Bilbao. According to reports, the Guggenheim would receive $20 million, to be paid over the development period as a kind of licensing fee for the use of the Guggenheim name.

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