This fall, I co-taught such a studio (with Eli Meiners) at the University of Cincinnati. The project was a real one: the conversion of a former Kroger supermarket building into an open storage facility for the Cincinnati Art Museum, a Montessori school, and studios and display space for artists. The rules of the studio were a bit different: you could do anything you wanted, as long as it was begged, borrowed or stolen; your design did not have to be efficient or buildable, but gathered together from existing materials or from other buildings.
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