Rosemont officials are in talks with a group interested in purchasing the Rosemont Theatre, a potential move that would transition the 30-year-old publicly owned venue into private hands.
The village board Monday took preliminary steps toward a possible sale by rezoning the theater property at 5400 N. River Road from a government and institutional district to a commercial classification.
But Mayor Brad Stephens emphasized a sale is still only a possibility and that discussions — which have been ongoing for less than a year — continue.
“Any good deal for any of our assets is something we have to look at,” he said.
Stephens said the private group — an undisclosed “substantial” entertainment firm — came to the village expressing interest in taking over ownership and operations of the 4,400-seat live performance space.
Monday wasn’t the first time he’s floated selling the property. Fashion Outlets of Chicago owner Macerich had a tentative purchase agreement with the village to buy the theater, demolish it, and expand the neighboring indoor mall, until the pandemic upended those plans.
While the theater made it through the pandemic — assisted by federal shuttered venue operators grants — officials say business has never quite been what it was since the theater’s opening in 1995, struggling for years amid competition from downtown Chicago venues.
The Rosemont Theatre, which opened in 1995 with initial success, has struggled in recent years amid the pandemic and competition from downtown Chicago venues.
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Around the time discussions arose with the shopping center owner nearly a decade ago, the village’s financial advisers said of the theater: “Just give it away,” according to Stephens.
And then Monday came word from credit rating agency Moody’s of a Baa1 determination for Rosemont — even though the Northwest suburban municipality’s scorecard-indicated outcome was a few notches higher at Aa2.
Moody’s said the lower assigned rating incorporates other factors, including that a substantial portion of the village’s revenue stems from “an extensive array of competitive enterprises that are atypical for most municipalities and are reliant on travel and entertainment.”
“Moody’s doesn’t like that we own atypical venues, and that’s one of them,” Stephens said.
Still, he said the Donald E. Stephens Convention Center and Allstate Arena — the longest-standing publicly-owned venues in town and among the highest revenue generators — were “no touch items” for private ownership.
“We’ve been doing things this way a long time, and we’re not going to change,” Stephens said.
A sale of the theater would mean the property goes on the tax rolls, and Stephens estimates the annual tax bill would roughly equate what the village collects in annual revenue from the theater.
If an agreement to sell the theater goes through, the new owner would assume agreements for existing shows. Terms are still to be discussed, though some may be potential “deal breakers,” the mayor said.
Under any arrangement, the village would maintain ownership of surrounding parking lots. The theater building and a small portion of the front lot were put in a new tax increment financing district in November.
Officials have seen some appraisals, and a sale could fetch a “substantial” amount, Stephens said, though he declined to disclose a potential price on Monday.
Another consideration that led to discussions is the recent retirement of two key theater staff members: Ed Balogh, the director of building operations, and Sandee Greene, the administrative assistant.
