When vintner John Truchard told his CFO that he and his wife, Michele, were thinking of buying the Napa Valley Opera House, the finance pro's first question was, "How do you plan to make money there?"
"Oh, we don't," Truchard replied.
Possibly for this reason, the Truchards were the only ones to offer to purchase the historic building.
Now that the $4.2 million deal has been finalized — the papers were signed on Oct. 27 — the Truchards sat down to discuss the question many have asked, doubtlessly, their CEO included: Why?
What prompted the Napa couple to buy the 1880s landmark, which a community effort saved from the wrecking ball in the 1970s, and restored and reopened — but where no one has ever quite been able to figure how to afford to keep the lights on?
"Like a lot of the things we do, [the process] was organic," John Truchard said. "I can't say there is one answer but a combination of circumstances."
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Much of the decision can be traced back to the couples' Napa Valley roots.
John's parents bought land in the Carneros region of Napa Valley in 1973 and went on to establish Truchard Vineyards. John, after studying at UC Davis, returned to Napa in 1995 to begin his own business farming vineyards and then established his John Anthony Vineyards wine brand.
As the recession of 2008 hit, he and Michele, a fourth-generation Napan, launched their JaM Cellars brand (a combination of John and Michele) with a goal of creating affordable, but high-quality, wines. As JaM Cabernet, Butter Chardonnay, Candy Dry Rosé, and Toast sparkling wine became phenomenally successful, the music-loving Truchards, parents of three, began to get involved in the local music scene.
"We live in Napa," John said. "We are going to be here the rest of our lives. We live two miles up the street [from the Opera House]. And selfishly, we want to have cool stuff to do in downtown Napa."
"It started when Ken (Tesler) leased the Opera House for Blue Note," he added.
Tesler opened the West Coast franchise of the famed New York jazz club in Napa in 2016. The downstairs became Blue Note Napa, but Tesler also had the upstairs ballroom to put to use. It had been restored as a theater with rows of fixed seats, but subsequent renovations removed these to return the room to the flat, multi-purpose floor of the original design.
"He was looking for someone to support the upstairs to make the numbers work," John said. He and Michele signed on, creating the JaM Cellars Ballroom, which had the capacity to host larger audiences than the downstairs venue. When the Truchards also became sponsors of BottleRock Napa Valley, the ballroom became the site of many of the after-shows from the music festival.
Joining the Opera House board, John said they began to understand the challenges the non-profit board faced, "the maintenance involved, the upgrades that needed to be made, the dollars required. We also saw the synergy between our brand and the music."
In 2018, when the Opera House board decided the best strategy for preserving the historic building would be to sell it, the Truchards were easily the best match.
"We realized the the building needed a steward," he said, "and realized we were in a position where we could finally do that. We have a great relationship with Ken. We saw how it would all come together and work."
Michele added, "It does work for our brand, but over all it's preservation of downtown Napa, and so that is really important to us. I spent a lot of time downtown with my grandparents and great-grandparents, and it's just really important that it remains. And if we can help preserve and even improve it, it's really good for Napa as well."
"There are a lot of memories here," John said. "There was a lot of community involvement, so we're super respectful of all of the energy and effort investment the community has made here.
"I told my wife, it's like buying a church."
COVID-19 delayed the sale for a year, but with the deal finally complete, the old board has dissolved and a new Napa Valley Endowment for the Performing Arts will be putting to use the profits from the sale.
"Their goal is to invest those dollars to continue program more arts," John said. "They'll have money to program artists, speakers, comedy, here and at venues throughout in the valley — the college, the Oxbow Commons."
It was John Truchard who proposed a deed restriction on the sale that specifies that the building must remain a performing arts venue, unless a majority of the Napa City Council approves a change.
"I proposed we put the deed restriction on it so that everyone is comfortable with our stated intentions," he said. His other reason for the deed restriction had to do with the previous agreement the Opera House board had made with the city.
"The city loaned the Opera House $1.5 million to pay off debt, so they didn't go dark," he said. "In exchange, they said you owe the community so many uses per year, and as long as you let the community use it, we'll decrement the amount by $100,000 per year. I think there was something like $700,000 still remaining on the note. The city was going to forgive that note as long as we extended that agreement."
"There was no reason for us not to agree," he added. "It keeps the Opera House open, not private ... Otherwise they'd have had to pay the $700,000 back. So keeping the agreement leaves them with more money for programming. We want it to be used. We want to get more people to use it. Why would we not let the city and community use it, versus having it only be 'Oh no, this is only a private corporate center'?"
"My goal is to make this the best live-music venue north of San Francisco," Truchard said.
Tesler will remain the tenant of the Opera House, with five years remaining on his current lease and options to extend it. "I'm looking forward to working with the Truchards," Tesler said. "I've known them for five years and feel comfortable with them. And where else are you going to find a landlord who is so invested in the community?"
The extent to which the Truchards will be involved in programming for the upstairs ballroom remains to be determined, John said. "But Ken has always welcomed help in programming the upstairs. If we can find a way to work with Ken to break even, if we can program the ballroom and bring people to downtown Napa to enjoy events, we get the benefits in a couple of ways — first, that connection with music and Napa Valley and wine, which is really cool."
He added, "And when people come here for music, they have to eat and they have to sleep. So you bring people here to the restaurants, the bars, the hotels."
"We want it to be that place where bands want to play. [The Ballroom] is a great space. It's the right size — not too big, not too small," he said. "You can get enough people in here to generate revenue to pay for the artists, but when you're playing here, it's intimate. Artists love that. It's like a big club."
The advantage of the open design allows for multiple experiences, Michele added. Their plan includes space where the audience can move about easily, standing, dancing, sitting at high tables, and visiting the bar.
"We wouldn't be event planners planning to make money on the event," John said. "Our value would be activating the JaM Cellars Ballroom, so we get the advertising benefit out of it, and but our benefit is in doing something cool and fun for downtown Napa."
Michele concluded, "We're basically planning to do what they've been doing here but make it even better. Have more shows, more well-known bands and more often."
"It's not going to happen overnight," John admitted. First task on their list is taking care of the building. "It was built in the late 1800s, it's a big building and it's a public venue, so it pushes safety concerns even higher," he said.
"I am sure there is a lot of deferred maintenance, but we are comfortable with historic buildings — heating, electrical, plumbing. We're going in eyes-wide open."
He has already gotten word of problems with the heating system.
Also on the to-do list is a "refresh, updating the look and feel — nothing structural," he said. "The next would be helping out with the audio-video, making sure it's state of the art. The big thing really is having upstairs restrooms for the public to use. The only bathrooms are downstairs."
He anticipates the work could take "two to three years, if not sooner. We're going to try to do it as right as we can."
"We're fortunate that JaM Cellars is a brand that is successful enough that we can afford to maintain a building like this but also that it's synergistic, the use. It's just kind of fun. It's very fortuitous," he concluded.
"We are aware that without the work that was done by the community, led by Margrit Mondavi, we wouldn't be in a position to be able to do this, so it's a little bit like the passing of the torch. There was the generation that saved the building and got it to this level. I'm not saying it needs saving again, but there's another chapter to the Opera House."