The nonprofit behind Minneapolis' popular MayDay Parade will move out of the Lake Street theater that has been its home since 1988.

The board of In the Heart of the Beast Puppet and Mask Theatre has voted to sell the Avalon Theatre — a storied spot with a classic marquee and a hefty heating bill.

"Our work is vastly outside the building, and the reimagination of MayDay is headed in that direction too," said Laura Wilhelm, vice chairwoman of the board. But the loss of another community art space is "heartbreaking," she added.

Heart of the Beast is also vacating its storage warehouse and trying to find homes for the thousands of puppets inside. It's considering a name change, too.

The moves are part of a broader overhaul of the puppet and mask theater and its MayDay parade and festival, a weird, wondrous south Minneapolis tradition dating to the mid-1970s. Amid layoffs and furloughs — and long before the pandemic — the nonprofit called off the 2020 parade, saying it could no longer afford to produce the event alone. It didn't hold a parade this year, either.

At this point, leaders "do not plan to produce a full-scale parade" next year, said Elina Kotlyar, a staff member who works closely with the MayDay Council. Instead, they will "focus on smaller-scale, neighborhood-led celebrations."

During its long, scrappy history, Heart of the Beast has weighed whether to renovate or sell the Avalon, which has hosted puppet-building workshops and performances as well as occasional classes, discos and weddings.

The building costs about $71,000 annually to maintain and $22,000 in mortgage payments, according to Victoria Cox, the board's treasurer.

"We are losing the hallowed halls filled with memories …" Cox said in an e-mail. "But we are being freed from the pressure of sustaining a space that does not meet our needs in terms of programming and accessibility."

Now, Heart of the Beast hopes to find a smaller home. A storefront, maybe. Looking through the nonprofit's archives, its leaders came across a photo of the storefront the organization occupied in the 1980s, before renting and then buying the Avalon.

Hand-drawn posters advertise an upcoming show. Small puppets populate one window.

"We can imagine a similar space for our new home," said Claire Curran, the nonprofit's interim director. "As we came to this decision to sell the Avalon we remembered: Heart of the Beast existed before the Avalon, and it will exist after it."

Then there's the warehouse it rents nearby, a maze of papier-mâché puppets, masks and artworks, many dating back decades. In a statement, the board said that it's been working with museums here and across the country that could house the beloved puppets. It's offering artists a chance to retrieve their own works. And it will also keep "a small inventory."

But some artists are concerned that by closing the warehouse, history will be lost.

Organizing an exhibition of the puppets and other artworks stored in that space would "honor the legacy of the theater," said David O'Fallon, who helped found Heart of the Beast. It would also give folks a chance to rally around a new vision for the theater company, he said. "They could say at the same time: 'Here's a vision for our future. Join us.' "

"That would be doable, practical."

After months of quiet work, Heart of the Beast leaders released in February a report "reimagining the MayDay celebration as an inclusive, equitable, decentralized, and sustainable event."

In a video then, Wilhelm argued that because of the loss of many arts spaces in the city, the nonprofit "must protect the Avalon Theatre as a valued cultural space for our community on Lake Street," perhaps operating under a "new cooperative business model."

The decision to instead sell the theater came via "a gentle evolution" over months of deep discussion, Wilhelm said this week. At a recent meeting, the possibility of selling the building was met with more excitement than pushback, she said. "It was evident the next right step forward was to let the Avalon go into new hands that can put its full potential to work."

Though they won't have total control over who buys the property, she said, the board would like to pass it off to an organization that holds similar values.

With a skeletal staff and a failed search for new executive co-directors, "we are definitely in a contracted state," said Wilhelm, who has been on the board since 2017. But that puts the nonprofit in a position for a slow, regenerative rebuilding, she continued. "We're not trying to reform the old mound of clay. We have a brand-new, really small mound of clay."