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//Bricks and Mortar: Behind a Hedge Fund Billionaire’s Latest Big Gift

Bricks and Mortar: Behind a Hedge Fund Billionaire’s Latest Big Gift

We keep a close eye on Kenneth Griffin’s philanthropy, and for good reasons. Still under the age of 50, with a net worth estimated at $9 billion, Griffin is among the most active mega-givers in the hedge fund world. But unlike some top donors who stay in a narrow wheelhouse, Griffin’s interests range widely, and it’s hard to know where the next big gift will land.

For those institutions that are on the receiving end, a donation from the financier can be pretty Earth-shattering. A case in point: The Kenneth C. Griffin Charitable Fund recently gave the Norton Museum of Art in West Palm Beach, Florida a $16 million gift, the largest in its 77-year history.

The gift comes as part of a $100 million campaign that involves the construction of a 59,000-square-foot wing slated to open on February 9, 2019. That new structure will be named the Kenneth C. Griffin Building. The expansion will add 37 percent more exhibition space, which the museum will use for special exhibitions and to display a larger survey of its permanent collection.

Framed against some of Griffin’s other gifts over the last few years, his support for the Norton Museum finds the hedge fund titan further expanding a diverse brand of philanthropy.

Just how diverse?

Recent gifts include $10 million to reduce crime in Chicago, $3 million to the U.S. Soccer Foundation’s afterschool program, $125 million to endow the University of Chicago’s economics department, $12 million to the Chicago Park District, and $5.5 million to Chicago’s Field Museum to create a new display on Antarctic dinosaurs.

The takeaways here are pretty self-evident. First, Griffin is obviously a huge proponent of organizations in his hometown of Chicago. He also remains committed to educational causes—all the way back in 2006, for instance, he and his former wife Anne funded the opening of a new charter school in Chicago called Woodlawn High School.

And while a historic gift to a regional museum in Florida may seem anomalous, Griffin has shown a willingness to support potentially risky capital projects.

In 2007, the Griffins donated $19 million to the Art Institute of Chicago, where part of a Renzo Piano-designed addition was named the Kenneth and Anne Griffin Court. And in 2015, the Kenneth & Anne Griffin Foundation gave the Museum of Modern Art (MoMA) an unrestricted $40 million gift. The gift came at a time in which the MoMA was in the midst of a controversial expansion effort.

Griffin’s support for the Norton Museum comes at a time in which some donors have soured on ambitious brick and mortar campaigns. There are two big reasons for this. The first is financial: Project costs always seem to grow far beyond anyone’s wildest expectations.

Consider the case of the Metropolitan Museum of Art. In 2017,  it announced it would delay plans for a $600 million southwest wing dedicated to modern and contemporary art, and instead focus on replacing the skylights and roofing system above its European paintings galleries. 

Later that year, the Lincoln Center and the New York Philharmonic’s half-billion-dollar plan for a gut renovation of David Geffen Hall went back to the drawing board, prompting David Geffen to characterize donors’ lack of support as "shameful." 

And yet a funny thing happened after The Met and the philharmonic dialed back their respective projects: Both organizations collected record donations.

The second reason why some donors are reluctant to support massive capital projects involves generating meaningful impact. Many have concluded that rather than building glamorous new wings, the best use of their money is to fund programs that address pressing social challenges affecting historically underrepresented demographics.

As far as Kenneth Griffin is concerned, his gifts to Chicago educational causes and arts organizations illustrate an ongoing commitment to boost equitable access. And his gift to the Norton Museum suggests that these two issues—funding risky capital projects versus providing equitable access—needn’t be mutually exclusive.

Griffin said that the expansion "will create a wonderful opportunity for generations of Palm Beach families, students, and visitors to learn about and enjoy art."

The gift is another example of regional art museums giving their big-city counterparts a run for their money. Its backstory follows a familiar demographic roadmap: Donors grow up far from major coastal centers, make their millions (and billions) elsewhere, and ultimately give back to organizations back home.

Griffin was born in Daytona Beach, went to Harvard, got incredibly rich in Chicago, but still retains a huge footprint in Florida, having paid more than $230 million for oceanfront property in Palm Beach. (He pulled the plug on the project—dubbed Billionaires Row—earlier this year, due to, ironically enough, cost overruns.)

Griffin’s presence in the state begs the question: Will we be seeing more gifts flowing to southeastern Florida in the future? Well, we already have an answer to that one.

The Norton Museum said that the Kenneth C. Griffin Charitable Fund is planning to give another $4 million to endow the director position at the museum, bringing its eventual total contribution to around $20 million. 

2018-08-28T09:23:25+00:00 August 28th, 2018|Categories: Nonprofit News|