City Winery in Napa to close Jan. 1

City Winery announced it will close its Napa venue at the end of the year, conceding that it was unable to make the entertainment venture pencil out after pumping millions into operations and upgrading its facilities at the Napa Valley Opera House.

“While we anticipated a challenging market given the smaller local population and high tourist traffic, we thought we could at least achieve a cash-flow positive business within a couple of years. But no matter how hard we tried, no matter how much attention and staff we brought in to make it work, the velocity of business is just not there,” company founder and CEO Michael Dorf wrote in an open letter to the Napa community posted on the City Winery website.

The New York-based company, which has sister City Winery venues in Manhattan, Chicago and Nashville, said it is opting instead to channel its efforts into opening a new venue in Atlanta in early 2016, and locations in Boston, Toronto and Washington D.C. after that.

“The reconfigured Opera House, with its flexible upstairs space and restaurant improvements, is unique and drawing significant interest from multiple prospects,” said Bob Almeida, chairman of the board of directors at the Napa Valley Opera House. “We hope to have an agreement with a new operator in place before the end of the year. We do not intend to allow the theater to go dark.”

City Winery, which offers entertainment, dining and wine tasting under a single roof, leased the vintage Opera House and opened in April 2014 with hopes of turning it into what Dorf called a “world-class cultural stop for musicians touring the globe.”

They invested $4 million in operations and renovating the historic building, including reconfiguring the theater with a flat floor, adding movable seating, and improving food and beverage access.

In the past 17 months, they have presented more than 300 concerts and dozens of events and benefits.

Dorf said he believes that within three to five years, with the addition of new hotels, upgrades to the downtown core and development of more parking and public transportation, Napa will be “on its way to support a 365-day venue like City Winery.”

He added that unlike The Uptown Theater, which only mounts a handful of shows per month, City Winery “could only survive in an area that sees business year round.”

“Cultural centers such as ours, or Copia, The Lincoln Theatre, The Green Music Center and the Opera House in the past, need more than just capital to be built, but a flow of ongoing cultural consumers. Right now, and for the foreseeable future, there simply are not enough patrons,” he said.

City Winery shares space with the Opera House, which puts on 75 shows of its own each year and caters to local audiences.

Dorf said City Winery will continue to offer entertainment, dining and wine experiences through Dec. 31.

You can reach Staff Writer Meg McConahey at meg.mcconahey@pressdemocrat.com or 521-5204. On Twitter @megmcconahey