SINGAPORE - A $30 million waterfront theatre will open at the Esplanade - Theatres On The Bay in 2021.

The mid-size venue will seat around 550 people. It was announced on Monday (April 10) by Minister for Culture, Community and Youth Grace Fu during the annual theatre awards organised by The Straits Times' Life.

At the M1 - The Straits Times Life Theatre Awards ceremony at the Esplanade Recital Studio, Ms Fu said her ministry would contribute $10 million to the new waterfront theatre.

The Esplanade will raise the other $20 million.

She said: "With this 550-seat theatre, our arts groups will be able to scale up works previously presented in small studios. Today, majority of the works produced for major festivals require medium-sized venues. We hope that the new theatre would give our arts groups an appropriate size to create new content, not only for our local audience, but also for regional and international audiences."

According to the Esplanade, most new works of dance and theatre created in Singapore or overseas are meant for mid-sized venues of 500 seats to 1,000 seats. The existing Esplanade Theatre and Esplanade Concert Hall seat just below 2,000. The arts complex also has the 200-seater Esplanade Theatre Studio and Esplanade Recital Studio.

Last year, due to the lack of a suitable mid-sized theatre, viewers had to be seated on the stage of the Esplanade Theatre to better appreciate a new work by Thai troupe Pichet Klunchun Dance Company, says Ms Yvonne Tham, Esplanade's assistant chief executive officer.

Ms Fu brought up a similar issue in her speech, saying the ongoing run of Normal by Checkpoint Theatre could not pay for itself despite being sold out. It needed a 300-seat venue to break even but is shown in the 120-seat Drama Centre Black Box.

In 2012, the Arts and Culture Strategic Review, which advised on cultural policy, called for mid-sized theatres to be built at the Esplanade to support the development of new work by local artists.

The Victoria Theatre and Drama Centre Theatre, which seat around 600 each, are managed by the Esplanade but not programmed by its team. Ms Tham says both are 80 per cent utilised and heavily in demand during school holidays when community, school and professional arts groups want to put up shows. Victoria Theatre is booked till 2019 and bookings are accepted 18 to 24 months in advance.

Currently, the Esplanade's annual calendar includes 3,000 activities. Ms Tham says the new waterfront theatre would help the team increase its programmes for young audiences and seniors as well as commission more new work.

The new waterfront theatre will occupy a 3,000 sq m area along the Esplanade Waterfront, including the Edge, where music festival Baybeats used to be held, and the Waterfront Carpark.

The Esplanade will call for interested project consultants to submit design proposals for the theatre later this year. Construction will begin in 2019 and the venue will start operating in 2021.

To raise the $20 million it needs, the Esplanade will offer naming rights for a fixed term of more than 10 years, either for the new building, for specific facilities, or even programmes.

Esplanade's chief executive officer Benson Puah said they would also welcome public support, citing the dollar-a-brick scheme used to build the old National Theatre. Ways in which members of the public can contribute to the new theatre and its programmes will be announced in October, when the Esplanade celebrates its 15th anniversary.

The Esplanade Theatre and Concert Hall are only Phase One of a development plan mooted in the 1990s for the arts complex. Rehearsal spaces and three medium-sized theatres were supposed to be built in Phase Two.

A feasibility study commissioned by the Esplanade and completed in 2012 estimated Phase Two would cost as much as Phase One - $600 million. This expenditure is not considered viable in the current economic climate.

To meet its space needs, in August last year, the Esplanade transformed the former club Queen near Makansutra Gluttons Bay into the two-storey Esplanade Annexe Studio. This hosts musical gigs and is also a rehearsal space.