News: The Clay Theater may be coming back
Andrea Jesse
https://www.sfchronicle.com/realestate/article/clay-theater-san-francisco-22185916.php
Plan to revive S.F.’s Clay Theatre clears key hurdle
After more than two years of neighborhood anticipation, quiet deal-making and public backlash over a plan to reshape a stretch of Fillmore Street in Pacific Heights, venture capitalist Neil Mehta secured a key endorsement this week for the first of several properties he aims to revitalize: the shuttered Clay Theatre.
San Francisco’s Historic Preservation Commission on Wednesday approved plans to restore the single-screen movie house, which Mehta’s team says could reopen early next year.
The decision comes about a week after a Mehta-linked fund, Friends of Fillmore LP, raised $50 million to advance the broader Upper Fillmore Revitalization Project, or UFRP, public records show.
The new fund will “continue our work of investing nonprofit dollars with a focus on small business grants and investments, including an investment in the Clay Theatre,” Cody Allen, UFRP’s executive director and Mehta’s associate, confirmed to the Chronicle. Mehta and Allen have repeatedly described UFRP itself as a nonprofit initiative, though the Chronicle has not been able to verify that claim through public filings.
Previous reports stated that the Clay Theatre’s renovation was expected to cost $5 million. Allen did not respond to inquiries about whether UFRP plans to purchase more real estate on Fillmore Street. Mehta has said in response to backlash over his revitalization project that he plans to provide financial support to new businesses that his team brings into his buildings on the corridor, including below-market-rate leases.
The funding infusion represents the second significant capital raised toward the sweeping project, which so far has involved entities connected to Mehta purchasing half a dozen properties on three blocks of Fillmore between Clay and Pine streets, including the forsaken theater. The Chronicle previously reported that a private equity fund called Aegis Reserve Partners LP raised $100 million from a single undisclosed investor — likely Mehta, who has confirmed publicly that he is funding the effort — in January 2024.
That same month, a limited liability company registered to Allen purchased the theater for $11 million, with a patchwork of similarly stealthy companies buying five other aging buildings on the retail corridor in subsequent months, spending close to $40 million in the process.
Together, the real estate acquisitions form the backbone of UFRP, an ambitious effort to reposition Upper Fillmore as a more cohesive retail and cultural district, with a mix of legacy businesses, new storefronts and community-oriented spaces. Supporters say the strategy could invigorate a corridor that has struggled with vacancies in recent years, while critics have raised concerns about transparency, rising rents and the potential displacement of longstanding neighborhood merchants. At least one restaurant that operated for decades in a building purchased by Mehta shuttered when its lease was not renewed, and its space remains vacant, while two other businesses closed due to expiring leases or unknown reasons after their buildings were purchased.
At Wednesday’s hearing, that broader debate gave way, at least momentarily, to widespread support for the Clay Theatre’s revival. Commissioners and public speakers alike voiced strong backing for the rehabilitation plans, with many framing the restoration of the historic cinema, which has been closed since 2020, as a clear point of consensus in a sometimes contentious redevelopment effort.
Commissioner Gayle Tsern Strang thanked Allen for being “receptive” to feedback from the commission, a sentiment that Commissioner Dan Baroni shared. He characterized the stakeholder engagement conducted in recent months as an “excellent sign of the future that you have with this project and its future in the community.”
The renovation aims to bring the Clay back as a single-screen theater while updating it for modern use. Plans call for restoring its historic facade and signage, replacing the current storefront with a more contemporary system, and making modest exterior changes, including new cladding, windows and rooftop equipment.
Inside, the theater would get upgraded lobby and auditorium spaces, a new balcony level, an elevator and added amenities like a new kitchen and upstairs bathroom. The design also preserves key historic elements — like the curved ceilings and sloped auditorium floor — even as the stage area is reworked to accommodate modern projection and sound systems.
Mehta’s team has tapped veteran cinema curator Ted Gerike to run the Clay, which is expected to offer a mix of programming once it reopens — including more than 500 screenings a year with 4K digital and 35 mm projection, a slate of first‑run films and repertory classics, live events and filmmaker talks, and a bookstore‑style concession area designed to make the venue a community destination, not just a movie house.
Allen said during Wednesday’s hearing that the theater was purchased with the “express purpose of returning it to its former glory as a neighborhood theater and the cultural cornerstone of the upper Fillmore area.”
In a message to the Chronicle, Allen said that, in the coming weeks, the team will file for building permits and hopes to “start building as soon as possible.”