Rio Theater, landmark along lower Russian River, up for sale again

The landmark Rio Theater, an iconic community hub in western Sonoma County for ?70 years, is back on the market after a 6-year experiment in collective ownership that succeeded in keeping the lower Russian River region’s only cinema operational - until last year’s flood drove home what key partners already knew.

With full-time jobs in the Bay Area and growing young families, there just wasn’t enough time, money and energy to fulfill their vision for the property, especially after on-site managers intended to oversee day-to-day operations didn’t work out, a representative for the consortium said.

But the group of 27 investors, which bought the 1.25-acre site for $599,000 in late 2013, hasn’t lost faith in its potential as an indoor-outdoor community event space, said co-owner Maura Dilley, a San Francisco-based green business consultant.

“I genuinely think this is a crown-jewel business that can serve the community and be viable and be dynamic in this day and age,” said Dilley, who with her husband, General Manager Dermot Hikisch, are principal investors.

Sale of the theater property, located in the heart of Monte Rio, could prove transformative, depending if future owners decide to keep the movie house, pursue the vision of its current owners, or raze the building and do something wholly different.

The site is zoned for recreation and tourist-commercial development, which allows a wide range of uses - from day care to telecommunication facilities, food service to hay cultivation.

“It gives you a lot of opportunities,” said Jeff Sacher, one of two listing agents with Santa Rosa Business & Commercial. The property is listed for $895,000.

A number of potential buyers have made inquiries, Sacher’s partner, Michele Habeeb, said by phone on the way to a showing.

“There’s interest,” she said.

Located in a converted World War II surplus Quonset hut above a public river beach at a busy rural crossroads, the ?167-seat, single-screen theater has long been woven into the fabric of Monte Rio and the lower river communities more broadly.

Generations of west county residents have bundled up in blankets to stay warm in the cool, cavernous space or heard the plinking sound of rain on the corrugated metal roof during movie screenings. Inexpensive family movies have long been part of community nights out, along with discounted meals at participating restaurants.

The building’s unusual semi-circular profile has lent itself to funky design features that include a faded landscape painted on the exterior. The curved ceiling is lined with fabric panels from Christo’s “Running Fence,” a famed 1976 art installation that stretched across nearly 25 miles of rural Marin and Sonoma counties.

But a string of owners has been challenged to keep the theater going throughout most of its history, through forays into live theater, the shifting seasonality of a micro economy and changes in consumer media consumption.

Twenty-year owners Don and Suzi Schaffert were nearly forced to draw the curtains in 2013 because they didn’t have the $55,000 they needed for a new digital projector. They had reached a point where it was nearly impossible to obtain first-run movies in the 35mm format they needed for their equipment.

Community members pooled funds through a Kickstarter campaign pushed over the threshold by actor Zach Braff. The fundraiser allowed the Schafferts to soldier on and make a few minor improvements, in addition to purchasing the new projector, while seeking a buyer who wanted to keep the theater viable.

Enter Colin Mutchler and Christy George, who have a weekend place in neighboring Villa Grande and took part in the Kickstarter campaign, Dilley said. They began talking to friends and friends of friends, and soon a group of people had come together to buy the place, taking on decades of deferred maintenance but also a kind of blank canvas on which they hoped to create something new and innovative, showing off the site’s open lawn and sweeping forest views, its proximity to river recreation and the unusual theater space.

“It’s too narrow to look at this opportunity as just for the cinephile,” Dilley said. “Selling movie tickets is not going to bring in enough money. But what is interesting is using the space all day long and for different applications, different purposes.”

The plan was an ambitious one: buy a “fixer upper,” do much of the physical labor themselves, and have staff to run the theater and manage the property for special events - from weddings to public occasions like the mostly annual Pongapalooza ping pong tournament.

For various reasons, two different managers hired by the owners didn’t work out. Hikisch found himself serving as general manager, managing the theater and special events largely on his own, in addition to performing his regular job in San Francisco.

In the meantime, the investor group did much of the work they had planned - retiling the lobby, updating bathrooms and installing new seats - and expanded the outdoor events through activities like corporate retreats.

But Hikisch and Dilley’s house-hunting efforts in the area failed. They and Mutchler and George, also key partners, started families. Others got new jobs or moved, and it “was just too much to keep up and to do right,” especially for Hikisch, Dilley said.

That was never clearer than in the past year, after a period of extreme rainfall in February raised the Russian River to its highest level in nearly a quarter century, bringing foul waters into low-lying areas of the theater, much of which had recently been upgraded.

One of the investors, artist Wendy MacNaughton, illustrated the partnership’s ordeal in the New York Times, describing the community inundation and the damage to their uninsured theater and the challenge they and other small business owners faced in an era of extreme weather.

But Dilley said their cleanup was comparatively simple compared with most of their neighbors, many of them resorts.

“We had warning and were able to move our more precious equipment to higher ground,” she said. “It wasn’t game over.”

Except for the floor in the rear of the theater, in what had been the Rio Cafe, now operating across the street, all the flood damage has been repaired.

Two other small Quonset huts on the property, including Kool City Surf Shop, also remain in operation.

With the decision to sell the property, Hikisch has not actively been booking the site, except for the annual Halloween screening of “The Rocky Horror Picture Show,” benefiting the Russian River Sisters of Perpetual Indulgence, and two other events.

“We all see the value and would love to have the Rio be that vibrating pulse of the community that it should be,” Dilley said, “and we can all see that that would be great.”

“Our hope is that we can find someone now that can take the ball and run with it, so we can share that vision, so it’s not just a single screen movie theater ­- that is just not the business that’s going to be viable there - but it’s a community event space.”

You can reach Staff Writer Mary Callahan at 707-521-5249 or mary.callahan@pressdemocrat.com. On Twitter @MaryCallahanB.