For five years, the NorShor Theatre restoration project has been dangling in front of us like a carrot. Every few months, it seems, a new announcement comes out that makes completion of the project seem imminent, yet the theater’s doors remain closed. So how much longer do we have to wait?

The city acquired the NorShor in 2010. There were two main reasons for this: Some people simply wanted to close down the strip club that was operating in the old theater; others, like Mayor Don Ness, had fond memories of listening to bands there, and thought that restoring the theater would help revitalize a decrepit block of downtown.

“It’s my goal,” wrote the mayor in an April 2010 blog post, “to work with a private arts organization to run a capital campaign to raise $2- to $2.5 million to support the renovation. Since it is in public ownership, the project would be eligible to seek state bonding funds as a match to the private donations/foundation support. Imagine what we could do with a full $5 million renovation of this theater and restoration of the historic building!”

Within a week of the mayor’s comments, the city council voted to buy the NorShor, along with the adjacent NorShor Annex and Temple Opera office buildings, for $2.6 million.

Citizens cheered wildly for the whirlwind deal, despite having no idea what kind of work needed to be done on the theater. The city council received over 130 letters and emails, most of them in support of the deal. Volunteers lined up to help clean the place. Revitalization seemed just around the corner. An entry from June 2010 on the website Perfect Duluth Day declared: “The mayor said that during the next few months, the theater will be cleaned and repaired, operational details will be formalized, and then in the fall the new NorShor’s first full season of entertainment will begin.”

Initially, the city hired Oneida Realty and the Duluth Playhouse to manage the NorShor. Christine Seitz, executive director of the Playhouse, told the Duluth News Tribune, “Soon, and for many years to come, the NorShor will be home to everything from opera and plays, to live music and more.”

Alas, a few months after purchasing the NorShor, the city realized that there was no bathroom on the first floor and no elevator access to the upper floors. Until these issues were resolved, the theater could not legally open its doors. At the same time, the estimated cost to restore the theater was rising.  By 2011, Mayor Ness’s $5 million estimate had risen to $7.4 million, which included a new roof ($628,000) and a skywalk connection to the Greysolon Plaza building next door ($1.64 million) that the city was legally obligated to build, pursuant to earlier agreements with the developer Sherman Associates, which owned the Greysolon.

In 2012, a new plan emerged. Now the city proposed giving the NorShor and Temple Opera buildings to Sherman Associates outright. Sherman would refurbish the theater using historic tax credits, grants and other funding sources, and turn over ownership of the theater to the Playhouse after five years. Sherman would retain ownership of the Temple Opera building. If they failed to carry out the projects, they would have to pay the city $2.6 million.

On Feb. 22, 2012, the Duluth Economic Development Authority (DEDA) signed a Memorandum of Understanding (MOU) with George Sherman, president of Sherman Associates, that laid out the terms of the plan. The MOU was nonbinding, but was hailed as an achievement of the first order.

“A year from now, we’re anticipating a financial close and a development agreement for your approval,” DEDA’s then-executive director Brian Hanson told DEDA commissioners. He estimated that the NorShor would be open for business in “spring or summer of 2014.”

On its face, the agreement freed the city from any further financial obligation for the NorShor, but there were many indications that this could change. One line of the agreement said that “Developer, Playhouse and City all agree to actively cooperate in fund-raising efforts to cover operating expenses of the Theatre and capital improvements to the Theatre.” Furthermore, in the event that the Playhouse was unable to cover operating expenses, “the parties hereto agree to negotiate in good faith to determine how any shortfalls in such revenue will be covered.” These bland phrases could conceivably wind up costing the city a great deal of money in the future, if things don’t go according to plan.

Since 2012, the MOU with Sherman has been amended twice, each time extending various deadlines for the project.
On April 24, 2013, DEDA Executive Director Chris Eng told the DEDA board, “They are on track for a September 2013 closing, then will be in the ground shortly thereafter.”

Alas, 2013 came and went with no development agreement, but in 2014, the NorShor received $7 million in state bond funding. At last, the project seemed poised to roar ahead.
On May 28, 2014, Eng said, “Very good news on the NorShor Theatre. We’re going to be moving very quickly on the development agreement. My hope would be to bring you a development agreement to approve in July, and construction could begin shortly thereafter.”

On June 25, 2014, Eng said, “Just a quick update for you on the NorShor. We have a draft agreement in place that will go to Sherman for review by the end of this week, so that we can begin construction this fall. Hopefully by September/October construction will be underway.”

On September 24, 2014, George Sherman and Christine Seitz appeared before the DEDA board. The NorShor project, they said, was expected to cost $25 million. In the end, when all was complete, the theater would be a hub for arts and entertainment in the city, with classrooms, performance spaces, a central ticket and marketing kiosk, two new elevators, retail space on Superior Street, and a wine bar and restaurant. The theater itself would seat 700 people, making it a type of mid-size venue that Duluth currently lacked.

“The NorShor is what we would classify in theater terms as a one-truck tour, meaning that one truck could come up and load in and load out,” Seitz explained. “Most of the shows that go to the DECC are called two-truck tours—much bigger. We don’t meet those requirements. The NorShor is designed for those smaller tours, and they do exist, and the one-acts that are going to the casinos around the country, and to Grand Rapids and all these different theaters, aren’t coming here, because we don’t have that size venue.”
According to promotional literature passed out at the meeting, the Playhouse hopes that the NorShor will host 200 concerts and other performances a year. Actually, the literature says that the NorShor is “expected” to host 200 events a year. Whether or not this is realistic remains to be seen; Duluth has plenty of projects that were “expected” to draw crowds of people—the aquarium, the alpine coaster, the Red Plan—but never did.

Mr. Sherman also wanted DEDA to give him a $300,000 “pre-development loan” to help design the skywalk connection to the theater. Some commissioners wondered about the wisdom of granting money to the project before a development agreement was in place. The resolution’s Statement of Purpose acknowledged that such a loan was an “unusual step” for DEDA, but that it was believed to be necessary, because “venues of this type often need to be assisted by the public as well as the private sector in order to make them viable.”
Sherman explained that the project’s $25 million price tag will come from several sources. Already in hand are $7 million in state bonds and $7 million in historic tax credits. Plans also call for the Playhouse to privately fundraise $4 million over the next five years. Sherman guaranteed to the DEDA board that he would cover any funding gaps in the project. “We already have over a million dollars into the project. We will be guaranteeing somewhere between $8- and $13 million to get the project closed.”

“We hope to be in front of the DEDA board at the end of November for final contract approval, with the goal of starting construction in December,” said Sherman. “It is tremendously complicated. There are probably already a dozen sources of funds. We are waiting for the historic approvals. We’re hoping that there’s no surprises.”
The DEDA board unanimously approved the $300,000 loan. If the project moves forward, the loan will be forgiven. If the project should fail to materialize, Sherman will pay back half the loan and the city will keep all of the project plans and drawings.
On January 4, 2015, Eng told the Duluth News Tribune that the NorShor deal “will close in the first quarter [of this year], no later than March.”
On February 24, 2015, Eng told the DEDA board, “Just to bring you up to speed quickly on the NorShor, we’re in continued negotiations with Sherman Associates. My hope would be that we would be ready for a development agreement in March or April, but we are continuing to work through the details and hope to close sometime in June and construction should start shortly thereafter.”
Which brings us to today. The theater’s doors are still locked. No one-truck tours are pulling into town. Nobody’s sipping wine or nibbling on appetizers. No elevators or kiosks have been built. The development agreement remains in limbo, subject to the whim of the developer.
When I contacted Christine Seitz on Jan. 23 to ask about private fundraising efforts, she said that after two months of work, the Playhouse had raised “a little more than $500,000” of their $4 million target. That is a strong pace. Hopefully it continues.
DEDA’s agenda for April 22 has nothing on it relating to the NorShor, which means that the earliest we might see a development agreement would be in May. But we don’t know.
One thing we do know is that whatever new extensions, deadlines and favors the developer needs from the city will be granted. The city has gone all-in on the NorShor; nobody would ever do anything to jeopardize the project.
All we can do now is wait. Fortunately, we have had five years of practice.