“Theatre in Sutton has no future,” according to the director of the company that ran the borough’s two leading venues until last week.

Sutton Theatres Trust managed The Secombe and The Cryer until going administration on Thursday, citing unsustainably low audience numbers.

The company had been appointed to run the council-owned venues just 14 months ago but ran out of of money after failing to raise external funding.

Director Beri Juraic said it had become “apparent that the business cannot be run in a sustainable manner”, adding the survival of the company “wasn’t possible without any local support”.

He suggested proposals to redevelop The Secombe, briefly mentioned in the council’s borough masterplan, posted a threat to the future of the performing arts.

Mr Juraic said: “Theatre in Sutton does not have a future, as the [council’s] new town centre plan and local plan propose to demolish the current building without appropriate replacement or any concrete plans.”

Several options for the future of The Secombe, including conversion into houses, offices or a school and retaining it as a theatre, are detailed in the masterplan.

The council this week faced questions about the decision to award trust a 10-year contact to run the two venues, which Mr Juraic said was “strictly on commercial terms”.

The trust was chosen as preferred bidder unanimously, with cross-party support.

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Former Sutton Theatres Trust director Micha Colombo, director Beri Juraic and Cllr Jill Whitehead

But Emily Brothers, former Labour Parliamentary candidate for Sutton and Cheam, said: “I was concerned that insufficient artistic weight was being given in the evaluation of bids.

“This was important in ensuring viability in the offer made to local people.

“Although audiences have doubled through a programme of comedy, the trust has evidently failed to provide a sufficient breadth of entertainment of merit to the public.”

She called on Cllr Jill Whitehead to resign as chair of the neighbourhoods and environment committee, which oversaw the award of the contract.

Tim Crowley, leader of the Sutton Conservatives, said questions needed to be asked about “what financial due diligence was done”.

He added: “To go bust in a year is pretty damn quick. We let a lot of people down here.

“If you gave the theatres to two groups you would split the risk, but we are where we are now. “There are some questions to be asked. I don’t think the council were wrong to try; we possibly should have looked at it a bit longer if I’m being honest.”

A council spokesman said: “The council completed all necessary due diligence and worked with the Trust throughout the transfer on lease and legal matters.

“The council is disappointed to learn the Trust has gone into administration.

“As the freeholder of both the Secombe and Cryer theatres the council will now work to ensure the obligations of the leasehold agreement are met.”