Caldwell Building “Sold” To Mortgage Holder; Cholerton Says Theater Company Is Done

UPDATED AT 6 P.M.

By Bill Hirschman

The gleaming building that symbolized the Caldwell Theatre Company’s hard-fought dreams was sold at a foreclosure auction at 11:17 a.m. today, but its circumstances didn’t change because the winning bidder was the bank that held its mortgages.

Legacy Bank of Florida regained the property for $1,000,100, topping the sole other bid of $1 million from Florida Rental Specialists, Palm Beach County court records showed.

Artistic Director Clive Cholerton also confirmed Tuesday afternoon what most theater observers surmised for months: The 37-year-old Caldwell Theatre Company itself is no more. “There are no plans to resurrect it,” he said.

The auction was ordered Aug. 24 by the Palm Beach Circuit Court after foreclosing on the two Legacy Bank mortgages totaling $5.89 million. With interest and late charges, the debt tops $7.2 million, court records show.

Once the title clears, the property goes back out for sale, said Scott Brenner, of Brenner Real Estate Group, the court-ordered receiver who will now manage the property for the bank. The bank’s attorney Michael Moskowitz has said that the bank has no desire to own or operate a theater.

At least two potential buyers are in discussions about the possibility of a sale before the end of the year, although their identities are confidential, Brenner said. His firm will also continue to seek other buyers.

Although two entities have expressed an interest in leasing the property with an option to buy it, Brenner said the bank has no interest in a long-term lease. At the same time, the bank is not averse to short-term leases of a month or three, or even renting the property out for events prior to a sale, Brenner said.

His firm reached out this summer to several cultural groups and other parties to find buyers or even renters. But the only renter was the student theater company, Entr’acte Theatrix, which produced Jesus Christ Superstar in July.

The identity of Florida Rental Specialists was not available Tuesday afternoon; they are not listed with the state’s incorporation records. But the $1 million bid flew in the face of the bank posting on the court clerk’s website in advance that it was willing to bid as high as $5.5 million.

The nearly 30,000-square foot cream colored jewel box at 7901 N. Federal Highway in Boca Raton has been shuttered since April 2 when the court-ordered receiver evicted the company. It had fallen victim to a long list of problems that included a shrinking base of subscribers and debts whose total even now has not been revealed.

“Something will fill this void,” Cholerton said Tuesday, and fulfill what the Caldwell began 37 years ago. “There’s some smart kid that’s going to be graduating from New World (School of the Arts) in the next year or so, or who has graduated, and will start the next wave and lay every brick perfectly …. This is by no means a death knell of theater in South Florida. Someone will do it bigger, better, stronger. Definitely.”

The Caldwell saga began in December 1975 when Hall and Bennett, a scenic designer, created the company at the urging of Rubbermaid Corp. founder James R. Caldwell.

It opened its first show, Neil Simon’s lesser comedy The Star Spangled Girl in a small auditorium on what is now the campus of Lynn University. Four years later it moved to the Boca Raton Mall.  In 1989, it renovated and moved into its best known space in the Levitz Shopping Plaza just south of its current location.

Despite the cramped space with no flies or wing space, Hall gave his audience frothy farces, contemporary dramas, chamber musicals, large cast classics and gay-themed plays during the summer off-season.

Some of its most acclaimed works were chancier ventures than the mainstream fare prevalent in the region: Bent, Papa, The Laramie Project, Take Me Out, The Elephant Man and Gross Indecency: The Three Trials of Oscar Wilde.

What most observers cite as the fatal if unintentional misstep was Hall and his board’s dream since 1991 to build new theater, spurred on by eventual plans to raze the Levitz property for development.

The plan was to raise enough money to have as small a mortgage as possible and to attract endowments. Palm Beach arts benefactress Countess Henrietta de Hoernle pledged $1 million. Hall spoke about the likelihood of opening a $5 million theater with a mortgage-burning ceremony. That money was nearly in hand, he said in the mid-2000s.

But plans to raze the Levitz property fast-tracked in 2005, accelerating the Caldwell timetable ahead of the fund-raising. Mortgages, architectural plans and construction began in the spring of 2006.

But at the exact same time, serious and unexpected problems began crippling the project. Construction materials became scarce and expensive because of county-wide demand to repair the ravages of Hurricane Wilma from the year before. The economy began imploding, the real estate bubble burst, government grants evaporated and donors balked on contributions. Even after cutting back on the scope, the projected price doubled and the theater had to assume a seven-year loan from Legacy Bank that it had never planned on.

Still, the Count de Hoernle Theatre opened in December 2007 with a production of John Patrick Shanley’s Doubt.

In 2009, Hall turned over the reins and the shaky finances to Cholerton, an actor/director who ran an investment advisory business. Cholerton had joined the board of directors nine years earlier and became chairman two years later.

His most noticeable headache was that the subscriber base was shrinking. This was occurring at almost every theater, but many observers blame Cholerton’s commitment to mix in more adventurous fare than his aging audience was comfortable with. Others counter that the Caldwell had a history under Hall of gently pushing at the boundaries of what its audiences would accept. Cholerton was also hoping that the choices would attract a younger audience to augment the older patrons who were disappearing due to mortality and illness.

Cholerton does contest is that the change in fare was the sole cause of Caldwell’s fate. “To diminish what happened to this simple notion that I tried to program too aggressively and too quickly, to say that was the reason for the downfall… that’s absurd, ” he said Tuesday. “It was a little bit aggressive but it wasn’t that different. There were other issues such as age demographics.”

A few Cholerton’s shows were artistic failures, but many others were some of the best work the company had delivered in years including  the world premiere of the musical Vices! A Love Story, Clybourne Park, The Whipping Man, Next Fall, Michael McKeever’s Stuff and its penultimate production, The Elaborate Entrance of Chad Deity which was critically acclaimed but could not attract an audience.

Cash flow became a pressing problem. A past board president and another former board member filed lawsuits in 2010 and 2012 to press the theater to repay $85,000 in personal loans.

Bank officials complained last winter that they hadn’t been paid mortgage payments since August 2011, even after restructuring the debt into two loans.

In February 2012, Cholerton was considering federal Chapter 11 bankruptcy protection to give the company time to fiscally reorganize, but the filing never occurred. The bank asked the court to foreclose on the mortgages that month.

Brenner was appointed on March 16 this year as receiver to control all finances. Cholerton hoped to convince Brenner to work with the theater to continue operations indefinitely and aid in restructuring the finances.

Much of what happened next has been sketched out in court documents filed by Brenner and a lawyer working for him, Marissa Kelly. Cholerton said Tuesday that some of the receiver’s representations in the court documents “mischaracterizes” some of what happened, but that “it wasn’t worth the effort to correct it…. That was one individual’s opinion that was sent to the court.”

Brenner’s report to the court contends that Cholerton told Brenner that the imminent show, the musical Working, could remain in the black and the Caldwell should be allowed to mount the production. In actuality, it did so poorly at the box office that the Caldwell had to dip into its bond with Actors Equity union to pay its cast, Cholerton said.

That meant the Caldwell needed cash to renew its essential bond, but the coffers were completely bare, court records state. Brenner refused to advance any money to mount the last show of the season, the world premiere of Christopher Demos-Brown’s Our Lady of Allapattah. (That show will have a reading at GableStage on Nov. 19 this year.)

Working closed April 1. The next day – hours before the Caldwell vied for the Best Play Carbonell Award for Clybourne Park– the receiver had the box office staff escorted out of the building and changed the locks.

 

To read a brief interview with Michael Hall, click here.

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