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How To Spend $7 Million: Artists Rep’s New Reality


What if somebody offered to pay off your mortgage, erase all your credit card debt, student loans — everything? Would it change what you could do with your life? Artists Repertory Theatre in Portland is asking itself these questions, after an anonymous donor gifted the company $7 million.

That much cash — approximately twice the company’s yearly budget — would be an eye-popping gift for any Oregon arts organization. For Artists Rep, it arrived at a catalytic time. This week, the company’s leaders were  ready to talk about how they money will be spent. In an open letter to supporters, Artistic Director Damáso Rodriguez laid out the plan.

Spoiler alert No. 1: The company is still selling some of its building.

As OPB reported previously, Artists Rep occupies a block-sized, 30,000 square foot building, housing the company’s operations — and also a dozen smaller nonprofit arts groups.

But upkeep on such a big, 40-year-old structure has proven more than the company could handle. Tenants were sometimes unable to pay rent. The company got behind on its payroll taxes and took out loans to keep operating. But the $7 million gift means Artists Rep was able to pay off its $4 million mortgage, plus $560,000 in overdue bills to vendors, a line of credit and credit card bills.

Artists Repertory Theatre's board chair, Mike Barr (left), and Artistic Director Damaso Rodriguez at the company's downtown headquarters.

Artists Repertory Theatre’s board chair, Mike Barr (left), and Artistic Director Damaso Rodriguez at the company’s downtown headquarters.

April Baer/OPB

For the remaining cash ($2.36 million), Rodriguez said, about 16 percent becomes an operating cash reserve. Another 13 percent will backfill a fund for specific programs — money that ended up spent on other things. The remaining $1,650,000 is going into a fund that only the board can approve spending, for helping the company through the sale of half its building.

“It’s likely going to be to help us manage this transition, finding alternative space, moving, paying for parking, things like that,” Rodriguez said.

So, yeah, about that transition period. The sale of half the Artists’ Rep building is still in progress. (Rodriguez said he’s referring to it mentally as ‘The Amputation.’) With half the block going for residential space and retail, Artists Rep loses its outdoor parking lot, one of its two theaters, and some rehearsal and administrative space. Rodriguez said these assets can be made up in the half remaining, but it’s going to take time, planning and a substantial construction project.

“We have to find a way to fit that square footage into the Morrison side of the block,” he said.

They can’t fit it all into the ground floor; Artists Rep has to build up.

The 12 tenants of the ArtsHub, as Artists Rep refers to its building, must all grapple with the changes in different ways.

Jonathan Walters is the artistic director of Hand2Mouth Theatre, 1 of the 12 tenants. Hand2Mouth had the foresight to maintain some offsite office and rehearsal space at its former headquarters in Portland’s central east side.

“We chose to never give up our life raft,” he said. “Our own offices, rehearsal and studio space. We aren’t as impacted as most folks.”

But Walters was banking on the chance to produce Hand2Mouth’s major productions in 2019 and beyond on Artists Rep’s stages. That’s very unlikely now, if the building sale goes forth as planned. Walters is pragmatic about it. He said Hand2Mouth has some options among theaters that own their own buildings. But he added he can’t help but compare Portland with other cities of similar size. As many cranes are on the skyline, the city is still woefully short on venues that seat 150-200 people.

“When are we hearing about a brand new performance center that’s going to be used by multiple parties, multiple venues, multiple organizations?” Walters asked.

Josh Hecht, the director of another ArtHub tenant, Profile Theater, said the company’s 2019-20 and 2020-21 spaces are in flux. It’s very likely Profile will need to stage shows offsite. He has to account for 18 to 20 weeks of rehearsal space, plus community engagement events. Hecht said he’ll be looking at private sector and other nonprofits outside the arts with space to lend — possibly non-traditional spaces.

“There’s an opportunity to inspire our community of patrons,” he said, “and find out who is out there and with whom we can forge some kind of relationship.”

Rodriguez is sounding more optimistic that Artists Rep will be able to help.

“I was in residence under a larger organization twice,” he said, referring to the company he co-founded, Furious Theater in Los Angeles. “And twice space went away. I’ve been there, and the second time it happened it was mortal to our company, but I wasn’t in a position where the parent or umbrella organization company was saying, ‘Don’t worry. We’re in this together. We’ll work together to solve this problem.’”

He said Artists Rep is in a strong position to offer some financial assistance for resident companies to move to their new spaces during the construction period.

There’s a lot of uncertainty around how all this will work. But Artist Rep’s board chair, Mike Barr, said ‘The Amputation’ and the sale of half the building is the right choice.

“We could survive, if the sale collapsed, and didn’t go through,” Barr said. “We could survive, but we believe we’ll be in better shape to meet our mission with the resources that provides.”

Capital costs have always been a problem. The building is badly in need of a new roof. Barr said cash from the sale, in concert with the $7 million gift, will offer a fighting chance for long-term stability.

But he and Rodriguez concede Artists Rep has to learn how to handle its newfound wealth.

“We did shake up our management and we did bring in outside oversight,” Barr said.  “We have a consulting CFO reporting to the board. We finished our audit … and now are posting this information, probably on a quarterly basis, until people get comfortable.”

Barr said the board also decided this week to begin a search for a new general manager, to supervise the building and company finances.

Rodriguez thinks back to January, when the company’s general manager had been fired, he was directing the world premiere of a massive, five-hour play, “Magellanica.” No one knew how audiences would react. And the gift was not yet a sure thing.

“The last line of ‘Magellanica,’” Rodriguez said, “was, ‘We’re at the tipping point. And you get to have what you’re brave enough to ask for. Be brave.’ And so that’s what was running through all of our minds during the rehearsal process. It was a time of great anxiety, and then a time of great relief and opportunity.”

Artists Rep makes its season announcement Monday. Rodriguez said all shows for 2018 and 2019 will be staged onsite at 1515 S.W. Morrison Street.

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