Tax breaks, payment dispute haunt Glenstone Museum’s newly completed $200M expansion

Contractors who revamped the private museum are seeking at $24 million in damages

New York Weekend Edition /
Sep.September 30, 2018 12:00 PM

Construction workers; visitors to Richard Serra’s “Sylvester” at the Glenstone Museum. (Credit: U.S. Air Force photo Master Sgt. Heather Cabral, April Pink)

Glenstone Museum, home to billionaire couple Mitchell and Emily Rales’ private collection of contemporary and modern art, is opening this week after a pricey revamp in which contractors claim they were shortchanged.

Built in 2006, the complex that contains their collection is located a few miles outside of Washington, D.C. on the site of a former hunt club, in Potomac, Maryland. In its first seven years of operation, Glenstone attracted only 10,000 visitors, but, now its $200 million expansion is complete, that is set to change, as the New York Times reported.

The museum is now seven times its original size and spans 230 acres. The new 204,000-square-foot addition, designed by architect Thomas Phifer, will contain 65 artworks by 52 artists, including Brice Marden, Pipilotti Rist, and Roni Horn.

The project comes after Glenstone was among 11 private museums whose tax-exempt status was investigated by the Senate Finance Committee over concerns about sufficient public access to their collection–the basis for the tax breaks–in 2015. To assuage concerns, the museum incorporated two new cafés into its expansion and will now open the museum to the public at least four days per week.

The Rales hired Hitt Contracting of Falls Church, VA, to oversee the project, but the contracting firm claims that they are still owed $14 million in subcontractor fees. Hitt Contracting filed a lawsuit accusing the Raleses of breach of contract at the end of August in the Federal District Court in Maryland seeking $24 million in damages.

According to the Times, the couple say the case is “without merit” and that they look forward to responding “vigorously in court.”

The museum opens Oct. 4, but there are already a backlog of reservations to visit. [NYT]–Patrick Mulholland


Related Articles

arrow_forward_ios
With a cooling trade war, stocks perform well, including real estate. (Credit: iStock)
Real estate stocks push up this week as U.S.-China trade tensions ease
Real estate stocks push up this week as U.S.-China trade tensions ease
416 West 25th Street and Maverick Real Estate Partners principal David Aviram (Credit: Google Maps and LinkedIn)
Chelsea landlord claims “predatory” lender is charging a crippling interest rate as punishment after losing foreclosure case
Chelsea landlord claims “predatory” lender is charging a crippling interest rate as punishment after losing foreclosure case
Steve Witkoff and Ian Schrager in front of the iconic PUBLIC hotel escalators. (PUBLIC, Getty)
EB-5 fund alleges Schrager, Witkoff siphoned money from Public Hotel
EB-5 fund alleges Schrager, Witkoff siphoned money from Public Hotel
Best Buy has closed about 20 of its big-box stores in each of the past two years (iStock)
Best Buy lays off 5,000 staffers, increases store closures
Best Buy lays off 5,000 staffers, increases store closures
Ryan Serhant and Gary Barnett on Development Slowdown in Pandemic
Coffee Talk: Extell’s Gary Barnett and Ryan Serhant
Coffee Talk: Extell’s Gary Barnett and Ryan Serhant
Cushman & Wakefield CEO Brett White
Cushman reports 10% drop in revenue in 2020
Cushman reports 10% drop in revenue in 2020
Central Queens Academy's Ashish Kapadia and United's Chris Jiashu Xu with a rendering of 88-08 Justice Avenue (Linkedin, iStock)
Charter school takes 85K sf in Queens condo building
Charter school takes 85K sf in Queens condo building
(IStock illustration by Kevin Rebong)
Smaller cities look to cash in on shift to remote work
Smaller cities look to cash in on shift to remote work
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...