This venue on the southwest corner of Fourth and E was built in 1924. Designed for stage and screen, it featured a single-level balcony, gold metallic wall paint, a gilded ceiling with ornate chandeliers, and a sizable orchestra pit. The original seating capacity — 1513 — commemorated the year Vasco Nuñez de Balboa arrived in San Diego, and whimsical 28-foot-tall vertical waterfalls were built into the walls on either side of the stage. The waterfalls operated at full force during intermissions.

The building housed vaudeville acts in the 1920s, until shifting to motion picture screenings. A neon marquee was added in 1930 and the name changed to El Teatro Balboa, to feature Spanish-language movies and stage shows, with usherettes often dressed in faux-bullfighter gear. Grandiose by any standards, the Balboa fell into hard times and disrepair in the '50s, until it was almost demolished for a parking lot in 1959. Russo Family Enterprises bought the building, spending $125,000 to remodel it in 1964. The City of San Diego placed the Balboa on its local Register of Historical Places in 1972, and it was being run by the blue-chip Fox chain until leased to Walnut in the mid-'70s, in a deal negotiated by George Tate.

Walnut squeezed additional profits from the Balboa by renting out portions of the building. Recalls head projectionist Dan Whitehead, "There was a tattoo artist for many years who called himself Doc Webb -- his shop was originally down on West Broadway, but he later moved it into the Balboa, where those storefronts were on the Fourth Avenue side of the building. The Mark Shoe Repair shop was owned by two Greek brothers who moved it from the Yuma Building [631 Fifth] into the Balboa building."

The City filed eminent domain proceedings to acquire the property at the beginning of 1980, ultimately succeeding. The Balboa closed April 6, 1986. It was still boarded up in November 2002, when a $10 million restoration plan was finally approved by a City Council committee.

The theater finally reopened as a 1,229-seat capacity performing arts theater with five stories of office space.