The Substation's board announced in a statement yesterday that the arts venue will close for good after it leaves its 45 Armenian Street space in July.
"This difficult decision was made after lengthy deliberations and several discussions with the National Arts Council (NAC) and with members of the arts community," the statement added.
The Substation is scheduled to move out of the conserved building it has occupied since 1990, as the site will undergo renovations. The NAC has said it can return to the venue as a tenant under the Framework for Arts Spaces scheme but that the space will be shared with other arts groups.
The board said The Substation would "lose a fundamental part of its identity and heritage if it cannot return fully to 45 Armenian Street", adding that the lack of control over the building facilities integral to its operations, such as the theatre and gallery, as well as the loss of venue hiring income, would impact its ability to operate as an independent arts centre and incubator.
The Covid-19 pandemic has made fund raising especially difficult, said board chairman Chew Kheng Chuan, 63. "We also reached out to NAC to help us with a lifeline to tide us over these two years. Their response was to offer some help, but it... fell significantly short of what we were asking for. We have been deliberating on this matter for almost two years."
The Substation's annual budget is between $1 million and $1.2 million, with the NAC funding 30 per cent to 35 per cent. Revenue from rental to other arts groups and live music bar Timbre covers between 35 per cent and 50 per cent, while the rest depends on fund raising.
The Substation pays $4,510 a month in rental to the NAC.
The NAC said it was "disappointed" by the decision and called it a "missed opportunity".
A spokesman said: "We had explained that it would not be feasible for any arts company to be sustainable if it relies on almost 90 per cent of its income from government funding, including the commercial tenancy income it derives from leasing out parts of the subsidised premises at 45 Armenian Street allocated by NAC."
Former Substation artistic director T. Sasitharan decried this as "the saddest day in Singapore arts". The Intercultural Theatre Institute director, 62, said: "We have sacrificed The Substation in the name of development economics, urban planning and progress... It's a damning indictment of all of us, as artists, as a people and a society."
The Necessary Stage's artistic director Alvin Tan, 56, who is coordinating a grassroots effort to save the venue, called for greater transparency. "The arts community has been locked out of the challenges The Substation has been facing, rendering us all helpless onlookers."
Singapore Management University arts and culture management programme coordinator Hoe Su Fern, 38, said: "If The Substation has always been known to be that one oddball in the arts that has survived more than 30 years, why is it giving up on itself now, before even giving itself an opportunity to try out new conditions and emerge stronger?"
The Substation will hold a town hall, hopefully by this weekend, to address some of these issues.