After a bleak day on the NY stock market, a host of questions are naturally raised about financial backing for upcoming Broadway and Off-Broadway shows.
While a 512 point Dow drop-off (Aug. 31) obviously affects any financial investing, the "correction" may not necessarily have huge ramifications for Broadway and Off-Broadway financing. At the moment, producers seem to be divided on the extent of the Market's pull on the Great White Way.
Producer Terry Allen Kramer told Playbill On-Line (Sept. 1), "I don't think this will have an effect on theatrical producing. People who are investing in the theatre are people who love the theatre. Three out of 100 show pay back...so if people are investing to make money, they could do much better (going somewhere else)."
Continued Kramer, "If you believe that in the next few months, the stock market will continue to drop, then it will be very difficult. If you believe the stock market has bottomed out -- then it's only going to get better."
Producer Daryl Roth (Villa Villa, Three Tall Women) felt the opposite, "I think it will have an effect, the stock market has it's finger on the pulse of everything." she told Playbill On-Line (Sept. 1). "I always tell people, 'Investing in play is like investing in the stock market,' and maybe this will make more people want to invest in theatre." "It's always a risky business to invest in a play," continued Roth, "Raising money for theatre is always difficult. Theatre money is always discretionary money, from people who love theatre and are looking to invest in it."
Jim Freydberg, producer of Big and Fool Moon, told PBOL (Sept. 1), "It's hard to tell, right now I'm in the middle of financing two shows and it has affected one of them." Freydberg would not go into details on the show.
"During the Depression," he continued. "Broadway had record-breaking numbers because no one could afford to leave the city, they went to the theatre...so, I don't think it will affect attendance."
Agreeing with Roth, Roger Berlind, (producer of City of Angels and the recently closed View From the Bridge) told Variety (Sept.1), "I think it could hurt Broadway. A lot of people will be saying 'Damn, that stock I've always wanted to buy is 40 percent cheaper now.' There's a very competitive investment environment now, and people will be more likely to look at the risk-reward ratio. Investing in Broadway is always precarious," Berlind continued, "When you buy Microsoft, there's not the chance you can be wiped out in the first week, which is always the case on Broadway."
The Aug. 31 dive was the second lowest drop The Dow's history, wiping out all gains of this year - including record breaking numbers in July. Prices see-sawed the rest of the week, with the Dow down 100 points at end of business Sept. 4 (leaving the market 369 points shy of its position before the Aug. 31 plunge).
-- By Sean McGrath