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Cinema Treasures indicates the location as 1st and Main. There is a church on that corner that could have easily been the theater by appearance. Looking back at the historical aerial photos, the building seems to be the same one that is there now. I am going to conclude that was the old theater even though Cinema Treasures indicates the status as demolished.
Newspapers mention a theater (the Community) back in the 1920's and then another house being built in 1947 as being the "first" theater to be built there.
There is a "theater-looking" building near the corner mentioned in the article. However, there is also an empty lot on that corner. More research is needed.
From the History of Armada:
"In its heyday, the town of Armada boasted an opera house, a theater, seven grocery stores, a hotel and livery stable, three hardware stores, a lumberyard, a grain mill, two implement dealers, a bakery, five doctors and several blacksmiths."