An aerial photo, dated on 3 November, 2016, of the land plot reserved for Guggenheim Helsinki.
An aerial photo, dated 3 November, 2016, of the land plot reserved for Guggenheim Helsinki.

The City of Helsinki has unveiled a revised proposal for funding the construction of Guggenheim Helsinki, resurrecting the all but doomed project.

The construction costs are estimated to amount to 130 million euros, according to a press release. The majority of the costs, a maximum of 80 million euros, would be covered by the City of Helsinki and the remaining 50 million euros by the Guggenheim Helsinki Supporting Foundation.

The Guggenheim Helsinki Supporting Foundation is to scrape together its share of the costs by raising 15 million euros from private investors and borrowing the remaining 35 million euros.

The city and the foundation would establish a joint real estate company for the construction project, with the former taking an 84 per cent and the latter a 16 per cent stake in the company. The company would borrow 35 million euros for the construction, while the loan repayments, fees and interests would be covered with leases paid to the real estate company by the Guggenheim Helsinki Supporting Foundation, the press release indicates.

A collateral security for the loan would be provided by the City of Helsinki, which would also be responsible for the maintenance and management costs of the property.

Related posts:

- Soini: There will be no state funding for Guggenheim Helsinki (30 August, 2016)

The Finnish Government decided not to participate in the project due to vehement opposition from the ranks of the Finns Party. It may, on the other hand, grant an annual subsidy of 1.3 million euros towards the operating costs of the museum.

Ari Lahti, the chairperson of the Guggenheim Helsinki Supporting Foundation, says the refusal of the central administration to cover its share of the construction costs is peculiar particularly in light of the fact that it stands to benefit the most from Guggenheim Helsinki. Calculations, he points out, suggest the museum would generate annual tax revenues of 4.9 million euros to the central and 1.3 million euros to the local government.

The City of Helsinki underscores in its press release that the museum must remain a public space open to citizens. Ritva Viljanen, the deputy mayor responsible for cultural affairs, reminds that the museum is bordered by an open public waterfront area on one side and that its courtyard has been designated as an open and free-to-use urban environment in the proposal.

The proposal will be considered by the City Board on Monday. If it receives the requisite support, the construction project could begin in 2019.

Aleksi Teivainen – HT
Photo: Jussi Nukari – Lehtikuva
Source: Uusi Suomi