The Leicester Haymarket Theatre, which closed in 2007, is costing the council £150,000 a year on a lease that has another 60 years to run.
Leicester City Council is now hoping to find a developer by advertising the property online for a price in the region of £500,000.
If the council continues to lease the property, the final cost will total £9m.
The theatre was once considered one of the country's top provincial theatres, attracting stars like Anthony Hopkins and Peter O'Toole.
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The Trust, which is in special measures, was named and shamed by the Health Secretary Jeremy Hunt as being one of the worst in the country.
Paul Farrelly, the Labour MP for Newcastle-under-Lyme, told ITV Central's political programme Central Lobby.