Could Second Stages Become An Endangered Species?

In the Dallas News, the type of article that is becoming very familiar:

WaterTower Theatre has been one of the area's biggest artistic success stories in the 10 years since producing artistic director Terry Martin took over. Audiences grew steadily as awards kept piling up. There were even serious plans to build a much bigger space near the present one in Addison.

Last season ended in August with houses at 95 percent capacity. But ticket sales suddenly dropped by about 50 percent with the first two shows of the current season, which opened in October.

(...)

"If we're really lucky for the rest of the season, we could break even, but I wouldn't be surprised if we take a loss," Martin says. "If our season subscribers don't come back for next year, our second season in our Studio Theatre might have to go away."

I do wonder about the second stage building boom of the last decade. The good thing for theaters that built them is that they will probably still be able to rent them to smaller companies or traveling shows. But producing in them may not prove a profitable venture -less seats, but with some of the same costs as a mainstage production.