Broadway’s Box Office Recovery Bets on New York Tourism Rebound
As Broadway emerges from one of its most embattled seasons, industry experts are cautiously optimistic. Based on current trends, live theater is expected to see a broader return to financial normalcy starting this summer. The key to getting there is smart pricing among long-running musicals, increased domestic tourism and the gradual return of international tourists, an important segment for both the industry and New York City’s recovery.
After the industry reopened this fall, following an 18-month shutdown, productions had to contend with reduced tourism numbers (international tourists could not easily enter the country until November 2021), new COVID-19 safety regulations for audience and company members, and then the delta and omicron waves, which led to canceled performances, the closure of several productions and shaken consumer confidence. Returning shows were helped by insurance proceeds and federal grants of up to $10 million, but those could go only so far.
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In this uncertain environment, two productions, Mrs. Doubtfire and Girl From the North Country, went on hiatus for several months this winter. And some productions pushed their opening dates to April in the hope of avoiding coronavirus cases in the company and finding bigger springtime audiences. This led to a crush of 15 new shows opening in April and three more returning to Broadway, which made it hard for any one production to find traction. Still, this seems poised to resolve soon. “I’m not seeing anything different from the traditional seasonality, and I am seeing significant indicators that it’s headed in the right direction,” says Hunter Arnold, a co-producer on several Broadway shows this season.
Tourism has not yet bounced back, and older audience members, particularly those 65 to 74 years old, have not yet made a full return, which exacerbates the struggle, says Brian DeVito, an independent ticketing consultant currently working on Hadestown. The limited audience means April’s flood of inventory also squeezed returning and long-running shows, leading several existing properties to temporarily lower price points to compete.
“I think it makes all of us have to work a bit harder to push them all through. But we all continue looking at this summer as being the real opportunity for us,” DeVito says.
That opportunity is expected to come from the marketing boost around the Tony Awards, which take place June 12, as well as an expected rise in tourism during the summer months. In 2022, New York City is projected to welcome 48.4 million domestic visitors and 8 million international visitors, marking about 85 percent of the tourism levels it had in 2019, a record year for the city. “The way to look at it is that by 2023, domestic will recover, and by 2024, we’re hopeful that international will recover,” says Chris Heywood, executive vp communications at NYC & Company.
Tourists made up 65 percent of all admissions in the 2018-19 season, with 46 percent traveling domestically from outside New York City and its suburban area, and 19 percent from other countries, according to the most recent demographic report from the Broadway League. Members of the Broadway industry are also positively viewing near-term hotel bookings in New York City, with hospitality data company STR predicting occupancy rates of 74 percent in June, 73.8 percent in July and 75.7 percent in August, an average of about 15 percentage points below 2019 levels.
As part of the natural life cycle on Broadway, several shows that cannot capitalize on Tony nominations will close and audience members may continue to flock to big brands, at the expense of others. But failing the entrance of a new, formidable COVID-19 variant, Broadway can chart a course forward.
“I think the industry is in a shaky spot at the moment, but I think they see a pretty clear path to being in a non-shaky spot,” said Jack Viertel, a former longtime theater executive at Jujamcyn Theaters. ”I’m not worried about the long-term prospects for Broadway, and I don’t think anybody working on Broadway is either.”
Source: The Broadway League
A version of this story first appeared in the May 17 issue of The Hollywood Reporter magazine. Click here to subscribe.
