(Lisa Poole for The Boston Globe
Under a canopy of clouds, dozens of people gathered at last week’s auction in the parking lot of the foreclosed North Shore Music Theatre. Before the auction, the crowd was abuzz with a rumor that another theater would step forward and buy the property.
But at the end of the day, Citizens Bank - which holds the $5 million foreclosed note - was the high bidder at $3.6 million, leaving many wondering if the lights in the theater would ever be turned on again.
“We’re still considering our options,’’ said Nancy Orlando, a spokeswoman for Citizens Bank. Orlando said the bank had foreclosed on the 26-acre property after the theater’s former trustees resigned. The site is appraised by the city for $12.2 million.
The theater closed earlier this year after revealing that it was more than $10 million in debt. In addition to the $5 million bank mortgage, the theater owed $5 million to ticket subscribers and vendors.
David Fellows, the former chairman of the theater’s board of directors, could not be reached for comment.
While the bank has not disclosed its plans for the site, Mayor Bill Scanlon said he believes another theater will purchase the property.
“There’s another shoe yet to drop,’’ said Scanlon. “I think they’re looking at another theater similar to what’s been there, but one that has a lower cost structure.’’
With an annual budget of $13 million, North Shore Music Theatre was the largest nonprofit theater in New England.
“I think there are people out there who want to continue it as a theater,’’ said Scanlon, who declined to name a specific theater or producer interested in buying the property. He said any talk of redeveloping the property for housing or office space would be speculative.
The theater, which opened as a summer venue for musicals in 1955, was financially solvent until recent years. But repairs following a 2005 fire - which gutted the main stage area - caused the nonprofit to take on $5 million in debt. Poor ticket sales in recent years forced the theater to make a final $4 million fund-raising push in the spring. That effort failed, and the sprawling complex - which once hosted musicals such as “Kiss Me, Kate’’ and performers as diverse as Bill Cosby and Joe Cocker - has been closed for months.
Since the theater’s financial troubles were revealed almost a year ago, former theater executives and directors faced criticism for its fiscal problems. In the late 1990s, annual attendance peaked at 350,000 with the theater selling 26,000 season tickets. In recent years those numbers plummeted.
But Jon Kimball, a former executive producer and artistic director who ran the theater for 25 years, said with proper marketing and productions, a new theater could thrive at the site.
“It certainly is a viable business and always has been,’’ said Kimball, who left Beverly in 2007. Kimball said the 1,500-seat rebuilt theater is practically new and has been only been used for 2 1/2 seasons.
Former Woburn state representative Nicholas Paleologos, a two-time Tony Award-winning producer, said he believes any theater owner would need to partner with the bank in order to open.
“If you have to go into the enterprise carrying $3 million-plus in debt, that’s not going to work,’’ said Paleologos, who now serves as executive director of the Massachusetts Film Office.
John Archer, a Beverly insurance agent who worked at the theater in the 1960s during his high school and college years, said the theater should go back to its roots as a summer-stock playhouse.
“They got too big; their budget got too large. They need to totally change the formula. They need to be very lean. They’re not a Boston theater,’’ said Archer.
In North Beverly, not far from the darkened theater, Joanna Liss also said she hopes someone with deep pockets reopens the theater. Liss, like many other local homeowners, used to host actors from the theater during summers in the 1980s. In exchange, she’d receive a small stipend and theater tickets. Now, she said, the theater’s closing is just beginning to sink in to its neighbors.
“There’s definitely a sense of loss here,’’ she said.
Steven Rosenberg can be reached at firstname.lastname@example.org.