The boarded-up theater at 707 E. Balboa Blvd. changed hands on Friday, Oct. 23, 2026. Local buyers Matthew and Danielle Peters paid just under $2 million. The seller was Balboa Theater Co. LLC, which is registered to Linda Sadeghi of LAB Holding, according to the Daily Pilot. The deal included a deed restriction that keeps the property in theatrical, cultural, event-related or performing-arts use. Ancillary commercial uses are also allowed.
The same kind of condition decided who could buy the building when the City sold it ten years ago, and it explains the price the theater has carried ever since. The other limit is physical. The theater already stands taller than the coastal base height, and the last revival plan was postponed while its rooftop height was under debate.
The sale, as reported
Since it opened in 1928 as the Ritz Theater, the building has been a neighborhood movie house, a vaudeville stage and a revival house. In that last role it held midnight screenings of "Rocky Horror Picture Show" until it closed. Its new owners are a local couple. Christian Emerson, who represented them, told the Daily Pilot that the family "has a long history of restoring historic landmarks across California." He described the goal as bringing the building "back to its former glory as a theater."
Emerson also told the Daily Pilot that detailed plans depend on conversations and meetings with the City of Newport Beach. Nathan Holthouser, president of Coastal Commercial, represented the seller. He put the challenge plainly in the release that the Newport Beach Independent carried: "Historic theaters can be challenging properties to own and restore."
He was understating it. The City's own history with the building shows why.
A use rule set the price in 2016
The City bought the theater in 1998 for $490,000 using federal Community Development Block Grant funds, according to the 2016 staff report. It then leased the building to the Balboa Performing Arts Theater Foundation. When that lease ended in 2014, the City Council directed staff to sell.
The sale process, as the Newport Beach Independent reported in October 2016, is the most useful thing to know about this property. In June 2015, staff advertised the building and received five proposals. The highest was $1.7 million to tear down the theater and build a mixed-use project. The lowest was $1 million to keep it as a theater. Staff then asked all five bidders whether they would accept a recorded deed restriction limiting the property to theater or event-center use. Only two agreed.
The appraisals show what that restriction was worth.
| Valuation in the 2016 City process | Figure |
|---|---|
| "Highest and best use" appraisal: demolish, commercial space with three housing units above | $1.625 million |
| "As is" appraisal, continuing as a theater | $890,000 |
| Top proposal received, teardown and mixed use | $1.7 million |
| Accepted price, LAB Holding, theater preserved | $1 million |
In other words, the City gave up roughly $700,000 compared with the top bid so that the building would stay a theater. Under federal rules, the sale proceeds had to go back to the Community Development Block Grant account. Staff chose LAB in part because the building, nearly a century old, needed "a lot of investment dollars" and a buyer experienced with historic structures. Sadeghi and his wife, Linda, founded LAB in 1993. The company is known for The Camp and The LAB in Costa Mesa.
Ten years later, the building sold again for just under $2 million, with a deed restriction set at this sale that ties it to performing arts. The 2026 wording, as the Independent printed it, covers more than the theater-or-event-center limit staff described in 2016. It lists theatrical, cultural, event-related and performing-arts purposes and explicitly allows supporting commercial uses. The 2018 plan included a café and an event space.
The roof is where the last plan paused
LAB brought its renovation to the Newport Beach Planning Commission in January 2018. The plan called for a performing-arts and special-events venue with 264 seats, compared with the original 450. It also included a rebuilt façade with storefront windows that open, a re-created marquee, a café with outdoor seating and a rooftop deck.
The rooftop deck raised questions because of the theater's location. The building sits in what the City calls the Shoreline Height Limitation Zone. The Daily Pilot reported that the zone caps buildings at under 35 feet, with the Lido House hotel and the Marina Park lighthouse feature as exceptions. The Independent's January 2018 coverage gave the specific heights:
- Existing building: 32 feet 3 inches, against a 26-foot coastal-zone base limit
- Proposed glass guardrail on the roof deck: about 36 feet
- Proposed canopy: 43 feet 6 inches
- Proposed elevator shaft: 47 feet 4 inches
In other words, the existing theater already stands above today's base limit. Any addition on top starts from a building that is already over it.
At the Jan. 18, 2018 meeting, City staff asked the commission to postpone the item. Deputy Community Development Director Jim Campbell said the proposal "needs a little bit additional work." Before the meeting, a resident's letter had argued that the 48-foot roof proposal conflicted with the Local Coastal Plan's height limits, and the commission had a coastal development permit on the agenda. Community Development Director Seimone Jurjis said that objection was not the reason the item was pulled, and that "we are reviewing the conditions of approval." The City had received nine letters of support and one other comment opposing the height.
The proposal was later withdrawn, and the theater has stood empty for eight years since.
Parking adds a second, quieter constraint. Coastal development permits issued years earlier by the state, during previous revival attempts, limited summer operations to give priority to beach visitors. Like theater guests, those visitors could park in the Balboa Pier lot, about a quarter-mile from the theater. Those permits have expired. Until the City adopted its Local Coastal Plan in 2016, the California Coastal Commission approved developments close to the water.
Three decades of plans, in order
The rooftop idea goes back further than LAB, and so do the cost estimates.
- 1992: The theater closes, according to the City's 2016 staff report.
- 1999: Philanthropists John and Donna Crean give the Balboa Performing Arts Theater Foundation $1 million.
- 2003: The foundation sets a goal of raising $2 million by 2005 toward a 320-seat live venue, with total renovation costs estimated at $6.5 million, the Daily Pilot reported at the time.
- 2006: The foundation secures a coastal development permit for renovation plans that include a rooftop deck.
- 2015: City staff estimate $5.8 million just to bring the building into shape for community use, and the City moves toward a sale.
- 2016: The Council approves the $1 million sale to LAB Holding, one of two bidders that agreed to a theater-or-event-center restriction.
- 2018: LAB's 264-seat plan with a rooftop deck is postponed at the Planning Commission and later withdrawn.
- Oct. 23, 2026: The Peters purchase closes, with a performing-arts deed restriction that allows ancillary commercial use.
Christopher Trela, who served on the foundation staff from 2005 to 2007, recalled in the Newport Beach Independent standing on the roof, looking at the rotting wood and wondering "how the interior would ever be brought up to code."
What will show where the Peters plan is headed
The deed restriction sets what the building will be used for. The 2018 hearing showed which parts of a design draw public review. Three things will show where the Peters plan is headed:
- A Planning Commission agenda item. That is where LAB's 2018 plan, and its coastal development permit, came up for review.
- The roofline. The existing structure is 32 feet 3 inches, and the 2018 rooftop proposal drew the height objections.
- The commercial component. Earlier coastal permits limited summer operations because of the Balboa Pier lot, so how large that piece is and when it operates are likely to come up again.
This post is general information about publicly reported rules and records, not legal advice. Readers with a stake in any property restriction or permit should confirm the details with the appropriate professional.
If you own property nearby and want a discreet view of where your home stands as this corner of the village changes, Kim Bibb is glad to help. Request a Confidential Home Valuation.
