The Hannah Playhouse Trust, which operates the Downstage Theatre building in Wellington, says it is expecting to be able to announce a new theatre organisation to work in the building.
The theatre, which closed in September this year, said it could barely survive on the money it was receiving.
Chair of the Hannah Playhouse Trust John Morrison said on Friday he hopes to announce a deal in the next few weeks for a theatre organisation to occupy the building.
Mr Morrison says the deal is confidential, but is optimistic that there is a lot of goodwill from the trust and the group it is working with to make the arrangement work.
Creative New Zealand has earmarked $170,000 in contestable funding for arts groups to use the building, but Mr Morrison says the deal under discussion does not involve that fund.