Latest closing is a sour note for club scene

An acoustic-music-oriented space whose walls are covered by signed posters from the musicians who've played there, the Kendall is the second Cambridge club to shutter its doors in recent weeks, following the House of Blues in Harvard Square. Musicians are now scrambling for places to play in a shrinking environment that has tarnished the region's image as a nightlife mecca.

Club owners say it's been a brutal year to stay in business. The soft economy, the smoking ban, the fallout from the tragic Warwick club fire, and even the Red Sox's playoff run (which kept more people at home watching the games) have all spelled headaches for club owners. And fewer local musicians have much drawing power -- radio stations now mostly support national rather than local acts, and many record labels have disappeared or merged and don't have the resources to be supportive.

"I've been in business 35 years, and I've never gone through what I'm going through now," says Tina DeLellis, owner of Johnny D's in Somerville. "I don't think it's easy to run a club anywhere right now," adds Bonnie Bouley, co-owner of T.T. the Bear's in Cambridge. "You think you're safe and then something else happens."

The closing of the Kendall and the House of Blues (which will become a franchise, family-style barbecue restaurant known as Brother Jimmy's) comes at a time when the high cost of living has also caused fewer young people to stay in the city. There was a 15.8 percent drop in the number of 20- to 30-year-olds in Greater Boston between 1990 and 2000, according to a joint report issued this week by the Greater Boston Chamber of Commerce and the Boston Foundation.

The situation has been so stressful that some owners are trying to diversify their clubs much like money managers diversify portfolios. Even a venerable rock dive like the Abbey Lounge in Inman Square is building a wine bar on its premises and planning to serve tapas (it hasn't served food before). The so-called "Wine Bar at the Abbey Lounge" will debut early next year in what is now a storage room next to the main bar. The rock bands will still play in the adjacent music room, though, so it won't be complete culture shock.

Another longtime rock dive, the Linwood in the Fenway area, is in the process of being sold and will be upscaled. Current owner Kevin Norton, who will stay on as manager, says he's thinking of "dramatic changes" that may include offering espresso, dessert, and more jazz. The rock will stay on the weekends.

Other owners are not averse to selling their rooms. The massive Palace entertainment complex in Saugus (a 14-club, 22-acre site) is for sale if the price is right. Owner Russell Robbat says that Home Depot and a supermarket firm have inquired in the past; he's also had a recent suitor that he declines to name. "If someone wants to write me a check, let me know," says Robbat.

He adds that the smoking ban has cut his business "25 to 30 percent" and that many smokers are going to clubs in Malden and Lynn, which don't yet have the ban. He hopes the smoking patios that he's constructed at the Palace will lure them back. The Palace has also been under pressure because the town's government just passed a new bylaw, according to Robbat, that would make it illegal for clubs to be open between 2 a.m. and 6 a.m. without permission from the Board of Selectmen. That targets the all-night, non-alcohol dance parties that have occasionally taken place there.

Clubs booked by the deep-pocketed Clear Channel Entertainment are in a better position to weather storms. "Compared to last fall, we've been doing 64 percent more shows," Clear Channel agent Jon Inammorato says of combined bookings at the Paradise, Avalon, and Axis. Many have not sold out, but Axis has profited from doing more all-ages shows, and the Paradise is enjoying a renaissance now that it is strictly a music club and no longer offers dance/DJ sets later at night, which fragmented the market.

Another reason for Clear Channel's increased activity, apart from its ability to simply outbid competitors, is that it books many national acts "that are touring more often due to not selling as many records, since people are pirating things on the Internet," says Inammorato.

Another sign of life is that the Sky Bar in Somerville is hosting more national acts than before, some of whom might have played the Kendall, according to Shred, the WBCN-FM disc jockey who books the Sky Bar. A further bright spot could be the revival of Bill's Bar on Lansdowne Street. It has slid off the radar screen this fall -- even importing some tribute bands rather than original acts -- but the bookings have just been taken over by Dan Millen of Harpers Ferry, who hopes to bring in more national bands. "Especially with a shrinking scene in Boston, it's nice to try to grow something back," he says.

None of this, of course, is going to help the Kendall at this point.

Club owner Mike Tallon has had a couple of potential buyers, but wants to sell the entire building (which includes four residential units), and no one has met his asking price of $1.4 million. So, unless a white knight comes along, he plans to rehab the building and sell it as condominiums.

He's also starting a record label -- Clann Records, which has signed country-rocker Mike Plume (a frequent Kendall headliner) and Irish tenor Tommy Fleming, who has sung with Phil Coulter and the Boston Pops. Later, Tallon, a native of Ireland, plans to open a restaurant/bar near his home in Hyde Park, as well as help rehab Hyde Park's 700-seat Fairmont Theatre, an old vaudeville site.

"It's time for a change," says Tallon, whose club also played host to the likes of Ryan Adams and Natalie Merchant and helped nurture onetime local singer Tracy Bonham.

"It's been a good run," says Tallon. "I may not be going out on top, but I'm going out positive."