Academy of Art agrees to $60M settlement with San Francisco

MarketsAssociated Press

The Academy of Art University in San Francisco has agreed to a $60 million settlement aimed at bringing the school's many illegally converted buildings into compliance with local rules, officials said Monday.

The deal ends a city battle with one of the nation's largest for-profit art schools and one of San Francisco's biggest landlords.

Continue Reading Below

"This was a case where the academy, a privately held for profit company, amassed a real estate empire while thumbing its nose for a decade at planning and building department code requirements. These are requirements that every other San Francisco property owner must follow," said City Attorney Dennis Herrera.

Herrera said the settlement would be by far the largest award the city has ever secured.

The city sued the academy in May, claiming at least 33 of the school's 40 buildings throughout the city were out of compliance with zoning codes, signage laws or historic preservation rules.

Additionally, Herrera claimed the school had taken 160 units of affordable housing off the market and converted them to student housing.

Academy of Art President Elisa Stephens says the academy is "very pleased" to reach the agreement.