Not-for-Profits

GMHC’s Soaring Rent Depletes Group’s Funds for HIV Research and Care [UPDATE]

The prominent New York AIDS service organization Gay Men’s Health Crisis expects to spend just over 3 percent of its annual donations on treating people with HIV, according to an analysis by DNAInfo. The vast majority of donations–GMHC expects to raise $11.4 million this year–go toward rent, administrative costs and executive salaries.

In fact, the $374,000 the organization expects to spend on HIV-positive and at-risk people this year is  less than the $389,000 it pays in rent each month at 446 West 33rd Street

gmhc GMHCs Soaring Rent Depletes Groups Funds for HIV Research and Care [UPDATE]Matthew Katz of DNAInfo reported last week that GMHC was “quietly planning to move out” of the West 33rd Street building a mere two years after moving in. The nation’s oldest nonprofit AIDS services organization is said to be working with the brokerage firm Studley to find a less expensive space in the next two years, well before its eight-year lease with landlord Broadway Partners expires. Mr. Katz’s article said that nearly a fifth of GMHC’s budget went to rent at its current 165,000-square-foot office, portions of which are still unused.

The latest news–gleaned from internal documents and anonymous sources–should sow further discord in the organization, whose plan to relocate to West 33rd Street was criticized by co-found Larry Kramer. One source told Mr. Katz that “when you donate to the AIDS Walk, you think that you’re funding meals, mental health, job training and legal services, In fact, your donation is used to pay rent on empty space.”

About $4.6 million of this year’s donations will go toward rent, with an additional $435,000 compensating the chief executive’s office and $293,000 going toward the chief operating officers’s office.

Update: GMHC issued a statement last Thursday calling DNAInfo’s story “woefully inaccurate…with incorrect numbers and misleading interpretations.” The accounting firm Grant Thornton‘s audit of the organization shows that $22,178,896–or 89.2%–of its $24,875,801 in “total support and revenue” went to “program services” expenses including care, support, prevention, education, public policy, information and advocacy. The audit states that $3,095, 391 went toward management, general and fundraising expenses, for total expenses of $25,274,287 and losses of $398,486 for the year ended June 30th, 2012. 

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