During Fiscal Year 2010, the financial markets and the US economy as a whole both showed signs of improvement. Modest economic growth and prudent management of the Museum of Fine Arts’ operations combined to achieve improved financial performance across a number of areas of the Museum.
Across all business segments, the Museum generated an operating surplus of $1,984M. By individual segment, the MFA achieved a surplus of $1,822M, the SMFA a surplus of $131K and Retail a surplus of $31K.
The value of the endowment increased from $409M as of July 1, 2009, to $450M as of June 30, 2010, with an overall performance return of 15%. Preliminary benchmarking places this performance return in the top 10% of endowment returns as reported by Cambridge Associates.
The Museum’s careful management of resources, long-term record of financial stability, and favorable operating characteristics resulted in a reaffirmation of Standard and Poor’s AA rating of the Museum’s bonds in the spring.
In April, the Museum entered into a letter of intent to rent the Forsyth building to Northeastern University, a process that concluded this summer with the signing of a 10-year lease. This lease allows for the building to be in good use, and provide a revenue stream until the Museum is ready to occupy it for its own purposes.
The East Wing construction project was completed in the fall of 2009 and turned over to begin reinstallation of the galleries. The Museum is working toward a successful opening in November.
Looking to the future, a new Strategic Planning process began during the fiscal year in response to the implications of the recession and the projections of ongoing economic uncertainty. We have developed a “bridge plan” that will guide us through the successful launch of the new wing and then allow us to reevaluate the Museum and its operations during and after the re-opening. I thank the members of the Strategic Planning Committee and the Budget and Finance Committee for their work in this vital planning process.
This is my final report as Treasurer before I assume my new role as Board Chair. It has been a remarkable time to be Treasurer, and I very much appreciate the support of my fellow Trustees and management during my tenure.
Respectfully submitted,
Richard Lubin
Treasurer and Chairman of the Budget and Finance Committee