Stephen Starr purchased the building for $600,000 in March 1981. He hoped to bring his Starr nightclub to a bigger facility, however, this was prevented by the Pennsylvania Liquor Control Board and local residents of the neighborhood. Instead, Starr reopened the cinema under the name The Palace, however it closed again September 1981. In 1981, former employees Claire Brown Kohler, Eric Moore and Ray Murray began working on how to reopen the theatre. Together, they formed the Repertory Cinema, Inc. (later becoming the TLA Entertainment Group). When the theatre reopened, to save costs, the new team would travel round trip to New York City to exchange reels.