Curtain may close on Varsity Theater

Publication Date: Wednesday Jun 8, 1994

DOWNTOWN: Curtain may close on Varsity Theater

City Council to decide fate of 67-year-old landmark Monday night

by Peter Gauvin

To people who remember the Varsity Theatre in its heydey, the thought that it could become anything other than a movie house makes them a touch ill. The thought that it could become large chain bookstore only aggravates their displeasure. Folks like Roy Ola recall that in the 1970s and early '80s, the historic theater on University Avenue became sort of a community center, with a lively restaurant and bar, movies and some headline concerts. Buddy Rich, Van Morrison and Count Basie played there, as well as local favorites like jazz duo Tuck and Patti. And Jane Fonda hosted the premiere opening of "On Golden Pond" at the Varsity.

If the Fox Theatre in Redwood City, built one year after the Varsity, can be saved, than Palo Alto ought to have enough community spirit to save the Varsity, Ola said.

"If we lose the Varsity we've lost something special that we can't replace," added Tony Badger.

Ola and Badger were among more than 20 people at a May 25 Planning Commission meeting who argued that preserving the Varsity for its historicl value means more than just preserving the building's facade.

Converting the theater into a 23,000-square-foot, two-story bookstore and espresso cafe (nearly twice as big as Kepler's in Menlo Park), as owner Chop Keenan has proposed, would be cheapen its historical and architectural integrity, they said. It would be further evidence of a disturbing trend that is stripping Palo Alto of its uniqueness and turning it into "Anytown, USA," punctuated with anonymous chain stores instead of the city's treasured small, independent businesses.

"We Palo Altans don't want super-stores or strip malls here," said Faith Bell of Bell's Books on Emerson Street. "Do you suppose the Long's Drug stores and chain bookstores will be shown off proudly in 50 years? Can't we keep this building true to its nature and use?"

Despite all the emotion, planning commissioners said they have little or no power to dictate what goes into the building, whether it's a bookstore or any other permitted use. They unanimously approved a proposed zoning change that would facilitate Keenan's $2.5 million renovation plan and sent it to the City Council. (Commissioner Tony Carrasco abstained because his architectural firm has been retained to do the work. One speaker, Winter Dellenbach, said while Carrasco's involvement is "not illegal, it tastes terrible.")

The Palo Alto City Council will consider the matter on Monday night.

The zoning ordinance amendment, triggered by Keenan's request, would allow a double square footage bonus for property owners who do both seismic and historic renovations in the downtown. Current regulations allow an increase of 2,500 square feet or 25 percent of the existing floor area, whichever is greater, for either a seismic or historic upgrade, but not both.

The change would apply to eight buildings downtown. However, only two could make use of a double bonus. And the only plans to do so are at the Varsity, where Keenan says he needs the combined bonus of 7,480 square feet to make saving the building feasible.

"Why am I going through all these hoops for 3,700 square feet? The fact of the matter is real estate is a nickel-and-dime business and you have to recapture your costs (with rent)," he said.

And if Keenan doesn't get the double bonus? "I'm not going to tear (the building) down. It's more at risk of falling down in an earthquake. This building is on roller skates," he said.

In February, Council members gave their initial endorsement for the zoning change, concluding that the additional bonus was a reasonable allowance in order to preserve the Varsity, one of only two buildings downtown that is designated on the highest level of the city's historic building inventory. They unanimously voted to have staff members draft an amendment to the zoning rule and have the Architectural Review Board and Planning Commission review it before returning to the Council.

Keenan said Friday that he has a lease agreement with Borders, a bookstore chain based in Ann Arbor, Mich., whose parent company is K-Mart Corp., to open in the Varsity in spring 1995. It would be a combined book and music store, he said. The ground floor would have 125,000 book titles, 2,800 domestic publications (magazines and newspapers) and 2,000 foreign publications. The second floor would have 60,000 music titles.

Keenan now estimates the seismic and historic upgrade will cost $2.5 million, or about $110 per square foot with both bonuses. It would be nearly half as expensive to replicate the building, he said, adding that he is building a 70,000-square-foot, nine-screen theater in downtown Santa Cruz at $55 a square foot.

"When you have to maintain the historical integrity of the building, it's not like you can just blast away," Keenan said. "It's like threading a needle. This is reconstructive surgery."

Opened in 1927, the Varsity is more than just a local landmark, history buff Dennis Backlund told the Planning Commission. It is one of only two Spanish-style courtyard theaters in California, the other being the Fox Arlington in Santa Barbara, which opened in 1931. The courtyard entry, extremely rare in Northern California, is an architectural feature typically found only in warmer year-round climates, he said.

Randy Lutge, general manager of the Varsity from 1974 until 1987, when it was sold to Keenan, said Keenan deceived him by stating that he would maintain the building as a theater. "He knew it was a living landmark when he bought it," Lutge said. "I think we should put it to a vote of the people: bookstore or theater?"

In 1987, Keenan leased the Varsity to Landmark Corp., a national theater operator that also runs the Aquarius, Palo Alto Square, the Guild and the Park. The Varsity is now on a month-to-month lease. At the time, Keenan and Landmark talked of retrofitting the single-screen theater--a financial dinosaur that is facing extinction across the country--into a three- or four-plex movie house that would be more financially viable. The plan never came to fruition though, and now, Landmark cannot afford the high cost of rehabilitating the structure, which is in dire need of repair, Keenan says.

Several community members have suggested reviving the multi-plex plan as a way to save the Varsity as a theater. Several speakers also disputed a figure contained in the city's staff report that said a bookstore like Borders could reap $20 million a year in sales, providing $200,000 in sales tax for the city. Nowhere is there mention that the sales would come at the expense of existing bookstores, they said. "What about the city's allegiance to local businesses?" asked Herb Brenner.

Keenan concedes that the city's sales figure is too high. He said $10 million to $12 million is more likely.

Another dispute is over parking. City planners maintain that parking needed for the theater is nearly twice that required for a bookstore. Thus, even with the 7,400-square-foot expansion, Keenan would not have to provide additional parking.

This fact rankled bookstore owner Faith Bell. "He is already entitled to a 25 percent increase and he wants 50 percent without paying for parking! I pay thousands of dollars a year for parking," she said.

Keenan said he too has fond memories of the Varsity and he sympathizes with those who can't bear to see it change. "I've been in town 40 years. I had my first date there," he said.

"Those emotions are all real. What you can't reconcile those emotions with is the economics of maintaining this historic architecture," Keenan said. "The one constant in this equation is that it's very expensive."

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