The Broadway Capitalization Epidemic

Gail Harper


In the 2018-2019 season, Broadway gained more revenue and sold more tickets than it ever had. Musical theater has never been more popular. So why are so many shows closing? Despite pulling a whopping 1.8 billion dollar gross and hosting nearly 15 million attendees, some of the most popular shows from this past season are closing their doors. This includes “Waitress,” “Be More Chill,” “The Cher Show,” ‘What The Constitution Means to Me,” “Pretty Woman: The Musical,” “King Kong,” and many, many more. Around 15 shows have announced their closings this season. Broadway shows close all the time, one might wonder why this is a big deal? Well, as stated previously, this Broadway season brought in more money than any season in history. 

And, the majority of the shows that are closing have had a tremendously short run—usually less than one season. “Be More Chill” ran for six months, including an initial month of previews, and brought in $13.5 million. “The Cher Show” ran for nine months, also with a month of previews. Its revenue gross was approximately $33 million. The average run for a Broadway show is approximately a year.

In all of its record-breaking glory, why did this successful season come to a head with so many shows closing? The answer boils down to one word: capitalization. In regards to Broadway, capitalization means while the price of putting on a show may only be a certain dollar amount, there are other factors that cause the profit to be lessened. The production cost of a show doesn’t include the price of payment for the actors and stagehands, the price to keep the lights on in the theater, costumes, props, sound, etc. The capitalization cost of King Kong clocks in at $36.5 million, so it would have to make more than that back to break even.

Two big factors for new high production costs are the Internet, and Bruce Springsteen. The Internet helped drive up capitalization costs with newer ways to spread information and the hype surrounding groundbreaking shows (see: Hamilton). Social media was even a major element in the Broadway musical Dear Evan Hansen, another revolutionary show. With new expectations and multitudes of fresh fans on the scene, it makes sense that capitalization costs would be driven up.

The other factor, Springsteen on broadway, set records for ticket revenue. Springsteen was number one on the list for per-ticket average revenue and number nine by total sales. This brought in people who would otherwise have no interest in going to Broadway, a new group of possible attendees to being exposed to the theatre. We are now witnessing the repercussions of Springsteen leaving Broadway, which caused ticket sales to decrease by 10%.

Sadly, as almost everyone knows, Broadway tickets are expensive (to put it nicely). Fans across the country—and the world—would love to attend, but motivation all comes down to money for many producers. So, ticket prices remain high, which results in fewer people being economically able to attend shows. Katherine Steele outlines this in her YouTube video, “Why so many Broadway Shows are CLOSING”, and mentions two ways Broadway shows can try to bounce back from that capitalization loss: licensing (smaller theaters can buy the ability to put the show on) and touring. Both of these options are helpful for fans not able to travel to Broadway (whether financially or geographically) see the shows.

An easy and enjoyable approach for you to help the future of theatre is by supporting your local theaters. Many theaters in the St. Louis area (not just the Fox!) offer popular shows with intimate, big talent energy. Alton Little Theater, Florissant Civic Center Theater, The Marcelle, and Gaslight Theater are just a few of the many theaters this area’s talent has to offer. Explore your local theater listings, and take a chance—you might be surprised by what interests you!

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