Theatre manager Steen is hoping the Phoenix Theatre isn't forced to move after Wollongong councillors voted to classify the land on which the theatre sits as "operational".
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The Coniston theatre, sold by the council to community radio station VOX FM for $1 in 2006, was sold back to ratepayers for the same sum.
An "operational" classification allows council to assess options for the land, including its possible sale.
Part of the motion passed by councillors included supporting "the continued use of the site to include use as a theatre precinct".
Steen said he was hopeful the Phoenix Theatre would continue to be the user of the site.
"We're just hoping that eventually we'll find a way for them to be able to sell it to us," Steen said.
"We've put a considerable amount of money into the building, with the understanding that we would be there under an 88-year lease under the previous owners."
Councillor Ann Martin said to "walk away from a cultural facility is horrifying" because such facilities were hard to come by. Steen agreed.
"If we were to build a new theatre or establish a theatre from scratch, the cost would be astronomical, way beyond anything anyone could afford."
Steen said the Phoenix Theatre was filling a need in the creative community offering space and support for local actors, writers and theatre companies.
"No-one does what we do and the reason we do it is no-one else was doing it," he said. "We're in the process of getting our liquor licence so we can become a live music venue. There's nowhere doing jazz in the afternoon or some of the slightly less commercial versions of music."
