D Magazine - Behind the Deal: Why the AT&T Performing Arts Center and Dallas Theater Center Intend to Merge

This article originally appeared in D Magazine by Emma Bayles and Ben Swanger.

For nearly two decades, Dallas Theater Center and the AT&T Performing Arts Center have operated as close partners. Now, amid changing audience habits and mounting pressures on the economics of live theater, the two Dallas arts institutions want to become one organization.

The nonprofits announced in late July that they are exploring a merger that would bring Dallas Theater Center under a unified AT&T Performing Arts Center organization. The proposal is now moving through due diligence and fundraising, with approval from both organizations’ boards and the combination expected in early 2027.

The deal is a straightforward business proposition: Combine two organizations that already share audiences and facilities, eliminate duplicated expenses, and create a larger platform capable of generating more revenue.

“There are material cost savings and significant revenue opportunity,” AT&T PAC President and CEO Warren Tranquada says. “It will make our combined entity stronger than either of us would have been on our own.”

The merger would consolidate finance, marketing, human resources, fundraising, and ticketing under AT&T PAC. The two organizations would also operate under a single board, with Tranquada leading the combined nonprofit.

It’s a significant structural change for two of the Dallas Arts District’s best-known institutions—but also a natural evolution of a relationship that dates to AT&T PAC’s opening in 2009. Dallas Theater Center is one of the center’s five resident companies and performs at the Dee and Charles Wyly Theatre. DTC also operates the city-owned, Frank Lloyd Wright-designed Kalita Humphreys Theater, which the combined organization would continue to steward under the existing agreement with the City of Dallas.

The Business Case

The deal comes as theaters nationwide grapple with a post-pandemic shift in how audiences buy tickets.

A 2024 American Theatre survey found that 42 percent of responding theaters that offered subscriptions had lost at least 30 percent of their subscribers since the pandemic. Another 21 percent reported declines of between 11 and 29 percent. At the same time, theaters are experimenting with everything from monthly memberships and smaller ticket packages to flexible subscriptions designed for customers less willing to commit to a full season months in advance.

Tranquada says Dallas is seeing the same behavioral shift.

“Going to someone and saying, ‘We want you to commit to see six shows a year in advance on these dates,’ is really going against what customers are looking for,” he says. “What we can do by working together is lower some of those barriers so that we can have more flexible seasons with more shows in them.”

Under one organization, the two groups could simplify ticket purchasing and give customers more ways to build their own packages across productions and art forms. Plans outlined by the organizations include more flexible exchanges, personalized ticket packages, and new membership options.

The idea isn’t necessarily to abandon subscriptions. For nonprofit theaters, subscribers provide something particularly valuable: predictable revenue and an audience willing to take a chance on productions they might not otherwise buy individually. But the traditional model increasingly has to coexist with consumers who want more flexibility.

That makes efficiency increasingly important, Dallas Theater Center Executive Director Kevin Moriarty says. “This will serve as an interesting case study and inspiration for performing arts organizations across the country as they think: ‘How can we all find ways to work together to better serve our communities and continue to keep our art forms fully alive, for the artists and for the audiences?’”

What Changes—and What Doesn’t

For theatergoers, the organizations say the immediate changes should be largely behind the scenes. Performances, subscriptions, memberships, and programming will continue without interruption during the transition.

Dallas Theater Center will retain its artistic identity. Enloe/Rose Artistic Director Jaime Castañeda will continue overseeing its productions, and DTC will remain a member of the League of Resident Theatres and maintain its Diane and Hal Brierley Resident Acting Company. AT&T PAC, meanwhile, will continue presenting touring Broadway productions, dance, and other performances, along with its Elevator Project supporting smaller local arts organizations.

Moriarty will lead Dallas Theater Center through the transition before concluding his tenure.

The organizations also see opportunities to combine their education programs and expand access to students. Their existing efforts range from student matinees and summer theater programs to backstage technical training and community workshops, with the combined organization setting a long-term goal of giving every North Texas student an opportunity to experience live theater.

The merger still has hurdles to clear. Both boards must approve it, and the organizations are spending the rest of the summer into the fall conducting due diligence and raising capital. Gibson Dunn & Crutcher and Foley & Lardner are representing Dallas Theater Center, while Haynes Boone is representing AT&T PAC.

If completed, however, the combination would amount to more than a reshuffling of Dallas’ arts landscape. Tranquada and Moriarty are betting that scale—and the ability to share infrastructure rather than duplicate it—can help build a more durable business model for live theater.

As Tranquada puts it: “Stagnation is not an option.”