The owner of the 1940s cinema, which was designated a historic-cultural monument in May, told the Los Angeles Times he is selling the property because anticipated tax breaks did not arrive in time.
Owner Robert Bucksbaum told The Times he agreed to let the theater become a landmark because he was told it would reduce his property taxes by 60 percent.
He said he expected the reduction on last month's property tax bill.
But the city's Office of Historic Resources and district Councilman Jack Weiss, among others, tried to explain to him that the savings would not go into effect until next year.
The bill he got last month was for $43,500, based on an assessed valuation of $3.5 million, The Times reported. Had the tax break been in effect, the bill would have been closer to $17,000, according to calculations by the Los Angeles Conservancy.
Bucksbaum said he bought the theater in 2003 for $3.2 million so developers would not turn it into a swap meet, and that he has been subsidizing the theater with money from his two businesses -- Reel Source and Exhibitor Relations Co., which track box office receipts.
The theater features Art Deco revival architecture and a hand-painted interior mural with images from Hollywood's Gilded Age.
The building was for live entertainment when it opened in December 1940 as the UCLAN, and was financed by Frances Seymour Fonda, wife of Henry and mother of Jane and Peter Fonda, according to The Times.
After World War II it was converted to a movie theater.
In 1987, then-owner Pacific Theaters and Walt Disney Co. replaced the original facade with one that looked like an Art Deco movie palace.
Bucksbaum told The Times he had planned to return the theater to its live theater roots.
The asking price is $4.75 million, and there have been a "couple dozen" inquiries, the newspaper reported.
Bucksbaum said he would consider leasing the Crest from a new owner so he could continue to run the theater.