The Philadelphia Art Alliance, the venerable but long-struggling arts gem just off Rittenhouse Square, is to be absorbed by the University of the Arts under a deal approved by the boards of both groups.

The acquisition gives the university a gracious formal parlor a few blocks from its Broad Street campus in a neighborhood populated by many of the city's most generous arts donors. The school expects to renovate the Art Alliance building, the former Wetherill mansion, and to establish a committee to help determine its long-term use, said University of the Arts president David Yager.

Its new name: Philadelphia Art Alliance at the University of the Arts.

The change marks a bittersweet epoch for the Art Alliance, which had once brought to the city the likes of Man Ray, Martha Graham, and Andrew Wyeth, but which lost a good deal of its cutting-edge sheen in recent decades. Its six small galleries now mostly exhibit contemporary crafts and design.

"It seems like we could help invigorate it and bring it back to some of its importance in the city," Yager said. "What's interesting is, museums have opened in Europe that are small places that have become really important places for artists to exhibit. I'm told that at one time for an opening at the Art Alliance, people were streaming in the doors to see the most interesting work. If we could do anything like that it would be incredible."

Art Alliance board chair Carole Price Shanis said that keeping the books balanced had been difficult and that while the small arts center might have been able to keep going as it has, it would not have been able to realize its full potential.

"We've been in the black some years, and not so much reddish but pinkish in others, and when it's been pinkish we've had to raise more money to make up the difference," she said.

Often over the last two decades, money to help cover that shortfall often came from Shanis and her husband. Joseph Shanis, a onetime prominent retail executive and philanthropist, died at age 97 in March.

"I think that it was the right time to make a change, to make a difference," she said, "and if the two organizations each bring something different to the table, they can do more things more quickly and be a bigger voice. I just couldn't move over or give up until something like this was done, and now it's happening."

The Art Alliance has been eating through its endowment, which was about $900,000 a few years ago, according to tax filings, but little is expected to be left by the time the deal is made final. "Clearly we needed an additional $150,000 a year in operating income to build this into a going concern," said Thora Jacobson, the art club's executive director.

The Art Alliance filed a petition Friday in Philadelphia Orphans' Court requesting approval of the deal. Boards of the two groups gave a final nod to the merger Aug. 28.

Though it has little in the way of a permanent collection, the Art Alliance has been a major voice in importing visual artists, composers, poets, and others, particularly from the avant-garde. Its history is closely aligned with that of the city's once-popular eating clubs, and a restaurant has been a mainstay of the building.

The current restaurant, Le Chéri, has been considered a success and is not expected to change. "They'd like to be there, and we'd like them to be there," Yager said.

Established in 1915 as a small but ambitious artist-run arts center, the Art Alliance moved into the current Italian Renaissance-style building at 251 S. 18th St. in 1926. It traditionally presented the art of the day – often from opposite sides of the popularity spectrum. In the 1930s, it hosted Vladimir Horowitz and Nelson Eddy, Gertrude Stein, and Walt Disney (in 1932, in what was believed to be the first museum exhibition of animated art).

It was the venue, in 1936, for Andrew Wyeth's first show. "I was 17. I was thrilled," said Wyeth in 1989 upon accepting with son Jamie a shared Medal of Achievement from the Art Alliance. "I didn't sell a thing."

Horace Pippin was recognized in 1947 with a major exhibition. In the 1950s, the Art Alliance brought in W.H. Auden, Dorothy Parker, Aaron Copland, and Dylan Thomas. There, in the 1960s, Merce Cunningham danced and Edward Albee spoke.

Although the Art Alliance's first significant shortfall came in 1969, according to its own written history, it continued to function as a locus for the arts community. When cuts in funding to the arts were made at the state and federal level in the Reagan era, the opposition gathered at the Art Alliance. "The arts are the beating heart of our country," said actress Colleen Dewhurst, rallying an army of arts supporters there in 1982. "We're in danger of removing all the life-giving, joy-giving, depth-giving things. When they told me what you'd done in the face of what seems to be a negative attitude, I couldn't believe it. You managed to march on an administration, and a government, and make them understand."

In the 1980s, the Art Alliance hosted a series of colorful parties, bringing in a younger crowd. "The renaissance of the Philadelphia Art Alliance is really becoming true," then-executive director Marilyn JS Goodman told the Inquirer in 1984, the same year a 240-work installation by quirky outsider Howard Finster was crammed into the building. But little by little, other arts groups began to take up parts of the Art Alliance's mission. Debt and infighting forced it to close for most of 1991, and it was rescued in part through the energy of Meyer P. "Pat" Potamkin, the banker and, with wife Vivian, major American art collector.

It was Shanis who shifted the focus to contemporary craft and design, and the Alliance was exploring renting space to craft-makers when the possibility of a merger came along, said Jacobson.

Yager expects that while design and craft will continue to be a part of what is presented there, he would like to see its scope widen.

Since being named president in 2015, Yager has overseen the the university's sale of the the Merriam Theater to the Kimmel Center, in November, and has been actively seeking to expand student housing. Although the Art Alliance is adjacent to vacant property just to the east, Yager said he did not see the university acquiring that property for dorm development.

What the acquisition of the Art Alliance promises to do, he said, is to bring students into contact with the art and artists – University of the Arts students and faculty are already frequent visitors, says Jacobson – and for the venue itself to become a teaching tool for students enrolled in the degree program in exhibition planning and design.

Fund-raising would be required both for the care of the building and for the works that go on in it.

"I know we're going to do something great, but the difference between good and great institutions is the content," said Yager. "The building is the container, but content rules, and that will determine if we are successful or not."