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Tragedy Tomorrow, Economic Woes Tonight
Like most longtime Broadway producers, James Freydberg is used to getting
loans. But recently he found that despite what he said was his perfect credit
rating, his bank was not so accommodating. “Banks are unwilling or unable to
loan money,” he said.
“We’ve seen economic setbacks before, but what we’re seeing now is very
unusual,” said Mr. Freydberg, who has been involved with more than a dozen
productions in the past 25 years. “For the first time ever, I’ve looked at our
business and said this looks like gigantic trouble.” Investment capital is “the
backbone of the industry,” he said, bankrolling the development of new work. As
for the nonprofit theaters, a severe drop in donations and audience means “some
nonprofits may go under.”
Not everyone is as pessimistic as Mr. Freydberg. Broadway is coming off a
couple of its best seasons on record. While everyone suspects that there might
be a handful of empty Broadway theaters in the spring, at the moment the big
theaters are still largely booked, and most nonprofits have finished their
fund-raising for this fiscal year.
More significant, though, is what happens when the next fall season comes
round. Those in the industry wonder not only about empty theaters, but also
about the effect on the stream of creative work. Will the money to develop and
nurture new work dry up, shrinking the flow of innovative shows? Or could a
forced financial diet actually improve quality?
The theater industry is squeezed on two sides, by producers and ticket
buyers. Banks are sitting on their capital, fearful to lend. Many wealthy people
have seen their portfolios lose millions, even billions, of dollars.
Emanuel Azenberg, who is reviving two of Neil
Simon’s autobiographical plays for next fall, said, “People who normally put
a lot of money in the theater — because they have a lot of money — are pulling
back either completely or very considerably.”
Mr. Freydberg, who is working on a number of projects, said people who had
previously invested with him have told him: “I love this piece, but I have no
way of doing this. I’m scared stiff.”
Putting money into the theater is “a luxury, not an investment,” Mr.
Freydberg said. After all, Broadway’s economics have never made much sense.
About 80 percent of its shows never earn back their initial investment. The lure
is the glamour and the thrill.
As for ticket sales, the producer Margo Lion said that family shows would
probably suffer first because it is more expensive to take an entire family.
Evidence has surfaced just east of Broadway, at Radio
City Music Hall. Last month the theater scaled back the number of “Christmas
Spectacular” shows to 216 from 225, including the cancellation of a show this
past Sunday. For the eight-week holiday season, 225 performances is an unusually
high number, according to a Radio City statement. However, canceling scheduled
shows in advance is uncommon for that landmark theater.
More than just family shows would be hurt by a drop in tourism. Ten years ago
visitors accounted for less than half of the Broadway audience; now they make up
65 percent, with nearly 16 percent coming from abroad. The weak dollar has
helped; foreign ticket buyers grew by nearly 5 percent over three years. Since
August, however, exchange rates have improved for the dollar.
On a smaller stage and with a smaller budget, some nonprofit theaters face
similar problems. “These are very challenging times, as difficult as we’ve faced
in 40 or 50 years,” said Roche Schulfer, executive director of the Goodman
Theater in Chicago. “I’m concerned about institutional funding from corporations
and foundations. Over the next couple of years we’ll have to figure out ways to
do as much with less, doing smaller productions, for example.”
What does that mean for the creative side? For many nonprofits that develop
new work, financing projects is likely to be tougher. Commercial producers often
partner with a nonprofit in the early stages, offering funds both to develop and
stage new shows, using what is known as enhancement money. In exchange for the
cash infusion, the producer gets a team that will hone a show, along with the
rights to transfer it to a commercial theater.
Many nonprofit theaters have become dependent on these funds. The Goodman,
for example, has been working with Tommy Tune on developing “Turn of the
Century,” a musical with classic show tunes. Mr. Schulfer said that he expected
all the promised enhancement money for this show to come through.
Ms. Lion is developing a musical called “Catch Me if You Can” with the 5th
Avenue Theater in Seattle. Ms. Lion, who recently decided to close “Hairspray”
because of the downturn, said she didn’t dare ask for money now.
“I thought I would wait until after the inauguration to look for new
capital,” she said. “I’m waiting for the new president to deliver a great
address” and maybe even “some sort of stimulus package.”
As anxious as people are about the future, Ms. Lion said she believed there
was also “a powerful sense of hope.”
“I actually find this very invigorating in a strange way; it’s challenging,
there’s drama,” she said with a laugh. “I hope this spurs thinking about more
innovative and cost-effective ways that don’t skimp on the pleasure for the
audience.”
David Binder, producer of the Off Broadway show “Fuerzabruta,” suggested that
“the bust could actually lead to a creative boom.” Now work is created only with
an eye as to how it will sell, he complained.
“New York is so overcommodified,” Mr. Binder said. “While the kid in
Greenpoint is creating the piece, he’s already figuring out how to sell it to HBO.
New York is so expensive, and it’s hard to be here, and I think that really
stifles creativity.”
Mr. Binder, who is also producing Moisés
Kaufman’s “33 Variations” with Jane
Fonda on Broadway, said that even some of the most innovative Off Broadway
shows had not been able to find space because of the expense. “There could be
some interesting alternative spaces because not everything in New York will be
at full tilt,” he said, “and isn’t that exciting.”
Carole Shorenstein Hays, a longtime Broadway producer and theater owner,
doesn’t see the possibility of a creative boom as limited to the fringes. In her
view some of the nonprofits have gotten as big and bloated as a jukebox musical.
“Where is it written that there has to be a development arm and an
administrative arm?” Ms. Hays asked. “When I started, there was no such thing as
enhancement money.”
“Show me a great script, and they’ll be there like bees to honey,” she said
from the Shorenstein Hays Nederlander office in San Francisco.
Rather than worrying about whether there are empty theaters, Ms. Hays said
the industry needed to look at the work, and invest in artists in whom producers
believe. “I’m not certain money is the be all and end all of art,” she said.
Ms. Hays has produced a long list of significant shows, including August
Wilson’s “Fences” and “Gem of the Ocean,” in addition to “Doubt,” “The Goat,
or Who Is Sylvia?,” “Caroline, or Change” and Suzan-Lori
Parks’s Pulitzer
Prize-winner “Topdog/Underdog.” She is planning a revival of “Fences” this
season, directed by Ms. Parks.
Mr. Azenberg shares Ms. Hays’s view. “The single biggest problem is that
Broadway used to be an equilibrium between money and art, and now it’s leaning
much more toward money,” he said. While Ms. Hays’s recession plan would be to
mount a festival of limited-run shows by emerging playwrights in Broadway’s
empty theaters, Mr. Azenberg’s ideal solution would be a national actors troupe.
He wants theatrical stars — Meryl
Streep, Kevin
Kline, Al
Pacino — to commit to appearing in limited-run plays at least once every
three years. (He has his eye on two Shubert theaters.)
“They only have to run three or four months, and you charge a normal price,
no premium,” Mr. Azenberg said. “We’ve proven that in three months those shows
can be eminently profitable. You might not be rich, but you can certainly make a
living.”
Still, most everyone agrees that such radical steps would happen only in
desperate times.
“Twenty years ago, when I arrived in this business, people were asking the
same question, and things haven’t changed,” said Nick Scandalios, executive vice
president of the Nederlander Organization, which owns nine Broadway theaters.
Since the 1920s people have warned that theater is dying. “I’m actually a little
bit more on the optimistic side,” he added, “but I know people out there are
scared, just like they are everywhere.”
