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June 26, 2019

The State Theatre will return to showing movies in downtown Sioux Falls thanks to a $3.5 million gift from philanthropist Denny Sanford.

Sanford’s donation, along with a $1.5 million proposed contribution toward structure and exterior work from the city, will allow the Phillips Avenue landmark to outfit its main level into what it calls a premium movie house experience for first-run movies, Hollywood blockbusters and art-house films.

“He called me out of nowhere,” said John Swedeen, who became president of the nonprofit State Theatre Co. in 2016.

“He said, ‘You know John, it’s a shame that theater isn’t open.’ And I said, ‘Yes, it is.’ When you’re looking for a $3.5 million gift, the stars don’t always line up, but they did this time.”

The donation represents a rare venture into the arts world for Sanford, who typically donates to health care-related causes and recently gave $55 million to the Children’s Home Society.

Sanford joked that he’s not “an artsy guy,” but he has watched for years as the downtown theater remained empty.

“My heart and soul and appreciation goes out to all the people who have worked for so many years trying to keep this thing together and make it happen,” Sanford said.

“It’s great for Sioux Falls, and Sioux Falls has been so good for me it’s payback time.”

The renovated theater will include luxury recliners and some booth seating toward the back, accommodating about 200 people.

“I insisted we get comfortable seating,” Sanford added.

“This theater was once the crown jewel of Sioux Falls. People dressed up and came from miles around. … The crown jewel will once again shine throughout the entire community.”

The theater plans to begin showing movies in the spring of 2020. The first one: A Sanford favorite, “Gone with the Wind.”

The renovated movie house “will be something Sioux Falls doesn’t have, and it’s really the trend,” Swedeen said. “So we’ll have the main floor of the auditorium complete, the projection room, anything that needs to go into the production quality – state-of-the-art audio and visual.”

While the State Theatre hasn’t been a priority for city government, “when I came into office, I looked at the State Theatre as a community investment for workforce recruitment, a quality-of-life tool,” Mayor Paul TenHaken said.

“What we didn’t want as the city was another building in our portfolio to own and maintain, so that’s why the piece really lined up nicely,” he said. “You have the biggest philanthropist in the history of our city say, ‘If you show support for this, I’ll show support for this.’ And quite honestly, if the city didn’t step up to partner with Mr. Sanford, it would have been a long road to get the State open. So all the stars aligned to make it happen that way.”

The new venue will help draw more people downtown, TenHaken predicted, including at night and during the winter months.

“Downtown retailers and businesses have a bit of a tough go January through April, Monday through Thursday. It’s not an easy life downtown,” he said. “This will expose people to downtown who maybe have never been downtown, and people won’t just come watch a movie. They will have a drink, get ice cream, get a cupcake, stop at a shop, so that’s why it really felt like the right investment.”

The city will fund its share this year and next from its entertainment tax, which will require City Council approval.

“Our entertainment tax is very strong thanks to how well some of our other venues are performing, so the funds are there, and it seemed like a very applicable and prudent use of that based on the return we hope to see from it,” TenHaken said.

Finishing the second and third floors, stage and balcony as well as restoring the elevator and Wurlitzer grand piano will require $2.5 million in additional donations.

The lobby, concessions, organ chamber and restrooms already have been restored, along with work on the roof, asbestos removal, marquee rehabilitations, new mechanical, electrical, plumbing and HVAC.

Once complete, the theater is expected to have about 15 showings a week and be open daily. It also will be able to be rented for private showings.

“It’s a unique venue that will draw 25,000 to 30,000 a year,” Swedeen said.

For Swedeen, the gift couldn’t have come at a better time. When he retired as CEO of StarMark Cabinetry, he wrote a check for $250,000, three years’ worth of operations to help keep the State Theatre effort going.

It was about to expire as the deal came together with Sanford and the city.

“I was at a point where I was going to have to ask the board about keeping this alive,” Swedeen said.

“And now we’re going to restore this.”