I caught wind of this potential closing a while ago. It is sad for me since I have worked there in the past. I would always want to see a performance space renovated instead of being demolished but in this case I think the days are numbered. The actuality that the theater has only 17% to 24% occupancy would suggest to me that the renovation money won't be coming. It was once a busier place.
Land is at a premium in Silicon Valley. There is much pressure to convert underutilized spaces for housing. There is some contention that tech companies should be doing more to support local education. They have built their own theaters.