The AT&T Performing Arts Center and the Dallas Theater Center plan to merge in early 2027 to both save money and expand programming possibilities in the difficult financial atmosphere for arts groups, which have faced dwindling audiences since the pandemic, leaders of the organizations announced Tuesday.
"The market for theater is challenged. It has been for some years," ATTPAC president and CEO Warren Tranquada said in an interview. "It accelerated post-COVID, but this started long before. Both institutions see that we need to do something to improve value for customers, create more flexibility and get ahead of ensuring that we've got the most competitive product for people to experience and turn around the loss in subscribers.
"There's no question that the finances of producing theater have gotten more difficult over time. This will be a more efficient way for us to keep the investment focused on actors, productions and the quality of shows."
If approved by their boards, DTC would become the producing division of ATTPAC, with redundancies in marketing, accounting and ticketing eliminated. That would mean layoffs of 10 to 12% of the combined staffs, according to Chris Heinbaugh, ATTPAC's chief advocacy officer.
The administrative offices used by ATTPAC and DTC also would consolidate, as it makes sense to have employees in the same departments working side by side.
The Theater Center employs 39 people full time, half of them in administration, executive director Kevin Moriarty said in a wide-ranging interview about the merger alongside Tranquada on Zoom Monday. ATTPAC, meanwhile, has about 85 full-time employees.
Under the merger, Moriarty's position would be eliminated. He would leave DTC after 19 years, the first 15 as artistic director, and the Theater Center would cease to be a resident company of ATTPAC. Under recently hired artistic director Jaime Castañeda, who began his tenure in June, DTC would continue to produce its own seasons of shows.
Sustainable, but stressed
DTC lost $2.2 million in fiscal 2025, according to ProPublica's Nonprofit Explorer website that tracks the tax returns of nonprofit organizations. In the previous three years, it took in about $600,000 less in revenue annually than it spent. Meanwhile, ATTPAC under its legal name, Dallas Center for the Performing Arts Foundation, netted $47 million in fiscal 2025 while losing $4.8 million, $6.5 million and $2.7 million in the previous three years, respectively.
"The center is sustainable," Tranquada said, "but operationally it's stressed year over year, and we are looking for ways to improve our sustainability."
"By coming together, we can move from maintaining the status quo to entering a period of growth and opportunity that would be nearly impossible individually," Moriarty said. "Together, we can actually think about a larger, more expansive future."
With DTC in the fold, ATTPAC hopes to package subscriptions across a wider range of programming.
"Audiences have become more selective, and the appeal of taking a traditional subscription has gone down, which makes producing theater significantly more challenging," Tranquada said. "This is not unique to Dallas. This is happening across the country. People like to make decisions at the last minute. They don't like to be committed. They don't want to have a curated season. That has made the economics of putting a produced season together that more challenging. And that's true for presentations as well."
From a season of touring Broadway shows to the Elevator Project series of productions by local groups, the nonprofit Performing Arts Center is essentially a presenter on its own campus in the Dallas Arts District. Its venues include the Winspear Opera House, the Wyly Theatre and the outdoor Annette Strauss Square.
ATTPAC also makes performance space available to its resident companies — Dallas Opera, Texas Ballet Theater, Dallas Black Dance Theatre and Anita N. Martinez Ballet Folklorico — and co-presents the TITAS/Dance Unbound season of national and international dance companies. Those contractual relationships would not change under the merger.
DTC performs its plays at the Wyly and the city-owned Kalita Humphreys Theater, which it operates.
What the merger means for the future
The merger would allow "the audience to navigate through the original productions that Dallas Theater Center creates from scratch in the same ecosystem with nationally presented work that ATTPAC brings across all of its different venues," Moriarty said. "So the audience, instead of having to choose a lane and being cordoned off in a silo, has the opportunity to find their way to whatever most speaks to them.
"That's a huge advantage to the audience, and I think it'll be a stimulant for the artists who are creating the work as well. We can put the right play in the right space, whether that's continuing to work in the Wyly and the Kalita or thinking about the other exciting spaces throughout the center in partnership rather than competition."
Moriarty and ATTPAC leaders envision creating subscription series that might, for example, package tickets to the Theater Center's annual A Christmas Carol production with other family-oriented fare presented by the Performing Arts Center.
"Right now we're limited in what we can put in our Broadway season by what's on tour, what aligns with available dates and the right-sized theater," Tranquada said. "By adding the capacity that DTC has, we can fill gaps in. So if we're seeing that there's a lack of family musicals touring, that would be a good year for DTC to produce a family musical to fit within a package. We end up with a better rounded set of offerings."
Moriarty compared this approach to what a streaming channel like Disney+ does with viewers who watch, for instance, a Star Wars movie or series. "The algorithm will also encourage you to see Marvel content, like an Avengers movie. Or if you're watching a Pixar film, it would invite you to see a Disney animated film. They're all inside of the Disney+ ecosystem."
The merger would be a bold step that builds on other cost-saving collaborations that have become an industry standard. For example, the Theater Center and Fort Worth's Stage West co-produced three shows between 2024 and earlier this year. Each production had separate runs by both troupes. Other local companies like Second Thought Theatre, which performs at Bryant Hall on the Kalita campus, have embarked on similar collaborations.
A historic shift
The proposed merger marks a historic shift for DTC, which has been an independent professional company since 1983. For a couple of decades after its founding in 1959, the Theater Center served as the graduate drama program for Baylor University and later Trinity University. In 2017, it won the Regional Theater Tony Award. It would remain only one of two LORT (League of Resident Theaters) companies in Texas, the best paying for actors and other artists under union labor contracts outside of Broadway and associated national tours.
"The performing arts industry has been undergoing profound systemic change nationwide," Tranquada said in a news release issued Tuesday morning. "Stagnation is not an option. Two major Dallas institutions are coming together in a proactive way to write our future, creating a new artistic and business model that can set the stage for strength and sustainability in North Texas and beyond."
The merger would not affect Second Thought's ability to put on shows at Bryant Hall, or Uptown Players' use of the Kalita as its primary performance space, according to Heinbaugh. Members of the DTC's resident acting company, who are not salaried, also would continue to be part of the Theater Center's work.
With the proposed merger, they believe ATTPAC can expand its educational outreach programs, Tranquada and Moriarty said. Moriarty mentioned that DTC is hosting summer camps in the theatrical arts for children at the Wyly. One of their pet projects is to ensure that every local seventh grader gets to experience theater in the Arts District, something they say becomes more viable now.
ATTPAC would launch a capital campaign aimed at past major donors to raise money for the merger's transition costs, including severance pay for laid-off employees and funds for programming during the early years of the merged organization, according to Heinbaugh and Tranquada. They declined to disclose the amount they hope to generate.
The executive committees of the boards of both organizations approved the merger Monday.
"They voted to authorize Warren and I to sign a nonbinding letter of intent, which lays out the fundamental structure and the case for the merger," Moriarty said. "Now we enter the monthslong period of due diligence and integration planning. Then hopefully by January, we would be ready for our full boards to do a thorough review and take the formal votes."
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