The most iconic building in downtown Hillsboro is the Venetian Theatre building. No longer a movie house, The Venetian, as it is now known, is entering another new phase of life. LoopNet, a commercial MLS Marketing network, just posted the building for sale. As a working broker in the area, I rarely miss a shot at selling a new listing in downtown Hillsboro; after all, my office is almost directly across the street from this former Hillsboro hotspot.
This exciting opportunity comes with a pricetag of $3,986,000 – or about $250 per square foot. The brochure put out today by Compass Commercial and my buddy Nick Diamond includes the floor plan, photos, and all the financials needed to evaluate the property. That is a lot of cheese, you might say- but the potential with this space has always been unlimited. This time the property comes with a new tenant who has just signed a 7-year lease, and based on the early information, it appears that an investor can expect to make about 7% on their investment, depending on the interest rate of loans and capital needed to acquire the space.
Venetian Property bought the building, LLC in 2020, just before COVID-19 changed the world. Owner John Lee paid $1,250,000, and from that point on, he removed the theater seats, leveled the floors into a flat event space, updated he entire space, the restaurant that faced Main Street, and finished the lounge/Bar space on the upper floor. The investment he made took the building to the highest level of finishes it has ever seen. Despite a few different attempts at a food venue and an event space, it never seemed to come back from an impossible start under the cloud of the pandemic.
You can check out the 13-page brochure and all the details about the building right here – https://buildout.com/sharing/1578317-sale?file=3995794. Shameless plug: I have been involved in three of the most significant sales and remodels in our Historic Downtown and would be happy to discuss this exciting opportunity.
The brochure mentions IRIS Decoration as the new tenant, with rent payments beginning in January 2026. The IRIS we found seems to be a good potential match, as their Facebook indicates they run events; see https://www.facebook.com/Iriseventos09/ . The sales brochure states that the facility can accommodate 1,200 people at once. While I cannot guarantee that is the case, it is a massive space. In reality, it can be a standalone event space, a standalone restaurant, and a standalone lounge/bar upstairs. It is quite a building- the most iconic aspect being the neon red VENETIAN sign, which was almost removed during the 2020 remodel.
A Rich History: 138 Years of Rich History
Here is our 2020 story featuring the building and news of John Lee and his plans:
Here is the deep history and photos I have collected over the years. Many of you old timers will remember how all of the elementary school kids in Hillsboro used to have a field trip to come to The Venetian (or The Town, which it was known as for a few decades) for a matinee and a bag of candy delivered by local Hillsboro businessman and Mayor Orange Phelps who at one time owned all the movie houses out here in the Hub City.
From Wikipedia
In 1888, banker John W. Shute built a two-story building on East Main Street as the new home for the First National Bank of Hillsboro. The structure featured a façade in the Italianate style of architecture, external cast iron ornamentation, and a roof line with a bracketed cornice. In 1911, the bank moved across Main Street and later mayor Orange Phelps purchased the building.[5] Although Phelps did not have the money to buy the building, the bank loaned him the funds and he opened The Grand Theater, a 200-seat theater.[6] The 19 feet (5.8 m) wide by 120 feet (37 m) long theater was expanded in 1915 to 500 seats and named the Liberty Theater.[6][7]
In 1925, a fire destroyed the theater and Phelps rebuilt the structure and named the new theater The Venetian.[8] The first motion picture with sound shown in Hillsboro was The Broadway Melody in 1929 at the theater.[6] Beginning in 1935 Phelps held an annual free show for children at Christmas which continued into the 1990s.[6][9] In 1956, a fire gutted the building, with Phelps rebuilding and opening the following year as the 800-plus seat Town Theater.[6] After the fire Phelps had held double features at his Town Theater.[10] In 1961, the theater hosted the premiere of the film Ring of Fire, which had been filmed in Vernonia, Oregon.[6] Phelps owned the theater along with several other theaters in Washington County into the 1970s.[6] Tom Moyer Theaters purchased Phelps’ theaters in 1978 and in turn sold all of that theater chain’s screens to Act III Theatres in 1989.[8][11] In 1996, Act III closed the theater and sold the building to the city for $1,500.[11]
After purchasing the property the city proposed several redevelopment ideas for the building, including selling it to the McMenamins brewpub chain for a theater and pub.[7][12] In 2001, Hillsboro purchased the adjoining 5,000-square-foot (460 m2) building (home to Music Village at the time) for $160,000 to add to the property to be used for any redevelopment of the theater.[13] The city solicited ideas for the redevelopment of the building in early 2007.[14][15] While under city ownership the space was briefly used as storage for the Hillsboro Farmers’ Market and faced possible demolition as estimates for the cost to renovate the structure continually increased.[16]
In August 2007, the city sold the building to developer Denzil Scheller for $10 and gave him $750,000 to assist in the renovation of the deteriorating building.[17][18] Scheller spent $2.5 million to renovate the space and bring the building up to modern fire, earthquake, and disability access codes.[19] Of this $2.5 million, around $1.5 million came from his own funds, and the remainder came from city funds along with $250,000 from Metro in the conversion of the space into a theater, meeting space, restaurant, and live event venue.[19] Work included gutting the building to rebuild the support structure, removing asbestos, and opening a wall into the adjacent Music Village building.[20] Local architectural firm Partin and Hill Architects designed the renovations.[21]
Scheller renamed the theater as The Venetian, returning to the former name, with the distinct yellow marquee of the Town Theater removed in September 2007.[22] The re-opening of the theater is part of the city’s plan to create a regional arts center in the downtown core and attract more people after 5:00 p.m. when county and city offices close.[14][17][23] On July 9, 2008, the new The Venetian Theatre and Bistro opened with the theater portion opening on July 11.[24] In September 2008, Bag & Baggage Productions became the resident theater company at the theater and opened their new season with Steel Magnolias.[25] In October 2010, the renovation of the theater was awarded the Outstanding Achievement in Design award from the Oregon Main Street organization.
In early 2017, owner Denzil Scheller reported that he had reached a tentative agreement to sell the theater to a buyer who, for now, wished to remain anonymous. The theater would close at the end of the day on April 13, temporarily, while the sale was finalized, to reopen at an unknown date.[26] The theater remained closed as of August 2017, and the Hillsboro Tribune reported that the planned sale earlier in the year had fallen through, with owner Scheller saying the buyer had “disappeared” without explanation just before completing the purchase.[27] In August 2017, Scheller told the Tribune that he had found a new buyer, but did not reveal any additional details.[27]
In April 2020, the still-vacant building was purchased by John Lee, who told the News-Times in May that he planned to reopen it with a new, upscale restaurant and to remake the theater space into a ballroom.[1] It is unclear whether Lee is the buyer to whom former owner Scheller had been referring–but not by name–when interviewed by the Hillsboro Tribune in August 2017.
A grand opening for the restaurant that was set for November 2020 was canceled at a late stage because of a newly imposed two-week ban on indoor dining imposed by Oregon Governor Kate Brown in response to a surge in new cases of COVID-19. The restaurant opened in mid-February 2021, with the name Venetian Hillsboro. By that time, the seats been removed from the former theater space and its gradual conversion into what the News-Times referred to as a “ballroom-style space” was underway.[2] The Venetian Hillsboro now rents its available spaces for private and public events. [28]
Dirk Knudsen is he editor and founder of the Hillsboro Herald, as well as the owner of Dirk Knudsen Real Estate – 222 East Main Street, Hillsboro, Oregon. 503-799-8383. He is also President of the Hillsboro Historical Society
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1200 people? There’s no place to park in downtown Hillsboro. All those lovely businesses but free parking is limited.
Bingo! An event that large would require shuttles from somewhere. Even 200 the streets are full- so this is a nagging problem for old downtown and we always hear”Ride The Max” etc- it’s a real issue!
After his acquisition of The Venetian Lee was told he had bought a pink elephant. The idea of an “up scale” restaurant in downtown Hillsboro was looney. Then he goes and removes the seats in the theater. Lee was also informed that the restaurant prices were not what Hillsboro would sustain especially in a too small restaurant space that would have difficulty doing what a restaurant must do, turn tables at least twice.
Also brought up was the lack of parking issue and that folks, especially on a rainy evening weren’t apt to walk blocks for an overpriced meal.
Easter brunch was outrageously expensive.
Then he loses Bag & Baggage and Ms. Rosetti’s growing dance business.
The Venetian has been a loser going back to when the City of Hillsboro got involved. Anybody remember the Cities then “Golden Boy” John Southgate?
Oh well, the Venetian continues to be an “I told ya so”.
It is extremely difficult to make an event space work in this city/region when you decide early on that one of the events most frequently in need of space here isn’t something you feel comfortable hosting. I look at the dress shops and boutiques that flourished downtown at the same time, or the gemstone event centers that popped up (Sapphire in the old bowling alley, diamond in the old hotel space on Calle Diez) and I just see everything they got right about Hillsboro that Venetian ownership got horribly wrong.
The restaurant was just beyond comprehension. You took a place that, at best, made a passable version of the Hungarian Mushroom Soup from Old Wives Tale, take away all of the theater elements, give it a menu that’s maybe a glossier Oswego Grill or Copper River, and charge as if you’re doing chef’s tastings in the Pearl? Come on.
The Venetian never had the name chef, the menu, the concept, or the will to be the restaurant it was hoping to be. Don Salamone ended up doing Don’s in Beaverton two doors down from the Broadway Saloon in way less space with a way smaller menu with similar levels of parking, and he packs the place weekly at prices that would make this readership’s eyes water.
I’m not going to pretend parking was ever the problem with the Venetian. Parking doesn’t stop people from coming down for Friday Night Bites. Parking hasn’t killed the Tuesday or Saturday markets. “No parking” in this town still means you haven’t found a space directly in front of your destination or refuse to park in one of the multiple (albeit poorly signed) free lots in the municipal/county complex or on 2nd or 5th.
The Venetian’s issue from the jump was its insistence that the Intel crowds its business drew on Century Boulevard would need it for the same staid corporate affairs on Main Street… and wouldn’t need the neighborhood’s input on that whatsoever. It turns out that Downtown Hillsboro actually has a lot of say in what works and doesn’t along Main. It’s why the axe throwing place is now better known for whiskey and barbecue, why Collective Market has almost no market and is largely a bagel shop and cooking classes, why Noble Hop is a running club HQ, why that wine district on 2nd keeps growing, and why the Hillsboro Bar and Grill made a better case for ribeye (on a barroom grilltop, no less) than the Venetian ever did.
Putting a movie theater in that space wouldn’t be easy without a nonprofit like the Hollywood’s or Tomorrow Theater’s or motivated owners like the Joy’s or Cinemagic’s—just ask the the Cornelius multiplex owners, who couldn’t make an indifferent Forest Grove audience go to the now-vacant Forest Theater for anything. But tearing the seats out means that booking it as a venue just became that much harder.
Would love to see Mississippi Studios come in and do what they did for Polaris Hall in Portland, or Monqui events do a year-round, scalled-down version of their bookings for the Grand Lodge. But unlike Portland, Beaverton or Astoria—where people regularly find parking without issue and walk to urban restaurants and venues that aren’t surrounded by seas of strip-mall spots—Hillsboro still thinks there’s no parking and that it didn’t invest a whole bunch of money in creating an accessible downtown. If Hillsboro thinks it can fill 6,500 seats for yet unnamed concerts at a ballpark nowhere close to the Max line where everyone STILL complains about parking, it can definitely bring people to shows and movies downtown… where there are two Max stops, multiple bus lines, and all of these parking lots: https://www.downtownhillsboro.org/parking/
Jason- you nailed it. People think they can plug and play their “great concept” into old town and have it work because it worked at their other locations- or someone told them it would work there. As a very long time resident I can tell you, for the most part, nothing has changed. The people here like a bargain, but will pay more for consistent quality. They want a regular spot that lacke pretense and welcomes all. Good food at a minimum is expected. Children need to be at least given considerations. Parking has proven to be a nagging topic of discussion but not an insurmountable problem for the right offering or event.
“The people here like a bargain, but will pay more for consistent quality. They want a regular spot that lacke pretense and welcomes all. Good food at a minimum is expected. Children need to be at least given considerations.”
I think you just described why Backwoods is still with us and the Venetian’s former owners are out.
Apparernlty, Iris Decorations made this announcement a while ago. Very happy to see it. They’re going to use this space in all of the ways that the old regime wouldn’t, and there’s great infrastructure around them in Lucia Isabel, Favi’s Fabulous Cakes, and more. This has the potential to be something special: https://www.facebook.com/DecorationIris/posts/pfbid0VJZ4BucMmezss7E3jbUaeiW6vqFuQiDEHWsdyuNWMwqLZZSPBcVARqyowLvoKHjwl
You know, I think you are right! The one piece to the puzzle which we are not able to know is the lease amount. You can give away gold covered roses but if the rent is not sustainable then it is all for not. I always hope landlords will work out a viable plan with the tenants to make sure that no matter what the venture has legs and will carry on. We did that with Blue Oxe and I am so proud of how the landlord and tenant worked together- I was glad to be the deal maker in my brokerage career sans journalist badge. Lani has also adapted to the neoghborhood, altered business plans and menus, and found a way forward! I really hope this works and will supoprt it in everyway I can!
Put me down for a $1,500 bid. That’s my life’s savings!
The parking comments are right on the money. Dirk is right about shuttles – maybe from the J.W. Poynter parking lot or Hare field. Do any of those government buildings have parking that could be used? Valet parking might be an idea – close off the north lane of Main Street and have group of drivers take vehicles to designated parking. Slow, but doable.
It’s a fabulous facility in a great, historic, location.
I am working on a old timey shuttle business- ;)
The biggest mistake made was trying to make a giant ballroom out of that space. I had always hoped that it would take it’s cue from the Hollywood theatre in Portland. I have always wondered why McMenamins steered away.
McMenamin’s early on took a look and saw a loser. How long have they been successful out on Cornelius Pass, Forest Grove, McMinnville, Lincoln City and so many other locations. The Venetian is a downtown location to be sure, but downtown Hillsboro is NO downtown McMinnville – Not even Close!
Are we talking Horse Drawn Carriages as an “old timey shuttle business” -;) ? (If so, don’t forget you’ll need “Pooper Scoopers” too. LOL)
Dirk, You correctly mentioned the hidden component to the new Lessee’s venture at the Venetian. As you know many a hobbyist has brought their dreams to DT Hillsboro only to find out the Rent, Insurance, Utilities, Common Area Fees, etc. are not factored in to their boundless enthusiasm and some businesses last quick.
In this case I cannot imagine that there is not a “Snake” or two in the Venetian/Iris lease that you admit ” we were not able to know – the lease amount” and more importantly the terms of the lease. IE: Triple Net or an NNN Lease, or Worse!
I suspect that the current owner, who has well overpriced the “Pink Elephant’s” sale price, has covered his Ass with a lease that will cover all hard-fixed expenses should the sale not be consummated and the lease were to run full term. There are probably “escalators” in the lease to cover any and all possible “events”.