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The Sale of the Art Works held by the Detroit Institute of Arts Could Bring Less Than Half Collection’s Value

As blogged by the American Bankruptcy Institute and reported by Reuters, art expert Michael Plummer was hired by the Detroit Institute of Arts to evaluate the collection for purposes of selling it to raise money for the City of Detroit Chapter 9 bankruptcy proceeding. Mr. Plummer reported that the Detroit Institute of Arts collection may be worth as much as $4.6 billion. However, he cautioned that a sale of the art works would raise less than $2 billion to pay the bankrupt city’s creditors.

The renowned expert concluded that litigation and market conditions would depress prices. Moreover, Plummer commented that liquidating the most valuable works would eventually force the museum to close. “Rather than being a source of cash to creditors or a burden on the current city, in fact, the DIA is the single most important cultural asset the city currently owns for rebuilding the vitality of the city,” Plummer stated. Some of Detroit’s “hold out” creditors have been pushing the city to sell or monetize art works to increase settlement payments in the city’s plan to adjust $18 billion of debt and exit the biggest municipal bankruptcy in U.S. history.