The theater faced troubling times in the 1930s beyond the Great Depression. While many movie theaters fared reasonably well by offering low-cost tickets and a needed diversion from the hardships of the era, Portsmouth faced its own set of challenges. The floods of 1936 and 1937 damaged the theater and devastated the town, and the total cost of the flood upon the Portsmouth area exceeded $16 million. After the flood, the theater was restored and reopened. The theater operated until the 1980s when it was closed as former patrons abandoned single-screen downtown movie houses for newer multiplexes.
Local residents and preservationists worked to revive the downtown area in the 1990s, and in 2006, Columbia Music Hall reopened as the centerpiece of this effort. Rather than showing movies, the historic theater reopened as a music hall. Only a year after its grand reopening, tragedy again struck as a 2007 fire completely destroyed the inside of the building. Although the exterior walls were the only thing that was still standing, the owners vowed to rebuild. Unfortunately, the original music hall could not be saved following the fire and the building was demolished in 2008. Preservationists worked with the owners of the building to save the original facade and lobby, however, and the rest of the building was constructed around these parts of the original. The Columbia Music Arena reopened with these historic sections of the former theater and the newly-constructed theater in 2012.