more insight on this Ed Butowsky chap. Would investments, managing partner
at our ticket prices expensive because of inflation catching up for lost
profit during the pandemic or are there other factors at play here?
Well it's it's all of the above.
I mean you have a pent up demand for people to get
out and go do something and they're willing to pay higher prices.
But especially if a star is starring in it,
like Hugh Jackman is recently starting in the music man.
And those ticket prices have soared to the highest level that I could ever remember.
So you're definitely seeing a built up demand.
You also have a lot of people who are
not traveling overseas so they're they're taking that money,
they're coming to new york,
they're staying inside the country and they're willing to pay up because they're
going to new york and they're willing to pay up for those prices.
So it's really a combination of you know,
the best of all worlds for broadway right now.
Yeah, so many factors at play here,
I'm glad that you mentioned the a list talent being one of those as well.
Something else that you mentioned that stuck out to me was
the fact that people aren't traveling overseas or maybe haven't been
making the same expenditures that they were pre pandemic but
we're expecting travel to be opening up here in the
spring and summer but these are still sold out show
after show for a lot of these different productions?
Why do you think it is that this audience is willing to pay these sky high prices?
Well because there's really just such a huge
demand to see these great shows and people,
you know, when you, when you start to think about, you know, $100 more,
when people are paying so much money to go out, you know, nowadays, you know,
$100 more per ticket is not that much.
When you look at the overall expense of going out and doing anything,
I mean anytime you walk out your door in New York, you're spending $100,
um so you know, to pay $100 more per ticket is not that outrageous,
especially if you're taking your family out,
um but people are going to continue to pay that much, as long as the productions are,
you know, about 90% of about 60 I think it's 16 of the 22 shows,
90% or more of the seats were filled recently and, and that's a huge number.
And you, you definitely have, you know, you had a time period where Hambleton,
you could never get a ticket to Hambleton and recently you were able to get tickets.
So the demand was starting to pick up right there,
and that's really the whole reason it's just a supply demand issue at this
point and people are willing to pay up because the demand is there.
Yeah, and it sounds like this would be happy news for broadway in particular,
as we mentioned, the pandemic, really dealt it a tough card.
Um So do you anticipate these profits to filter
down to really every aspect of the production industry?
And second question here, how long do you anticipate this actually last?
Do you think it plateaus at a certain point?
I expect this to last throughout 2022
into next year the demand is that high?
And you know, do I expected profits trickle down without question.
I mean that the actors are demanding more money because they have higher expenses,
it costs more money, you know, just the lumber alone to build these sets,
if you're building a set and having to replace things,
you know, everything has gone up and lumber alone has doubled in price.
So, you know,
every single thing in new york has gone up tremendously and as a result of that,
you know, they're they're getting great profits.
But even though the profits are there a lot of
expenses have increased as well to run the theaters too,
you know, make everything, you know,
you know, appropriate for a micron and all the other variances of,
So there's just a tremendous amount of expenses.
But I do expect this thing to continue for quite some time, as long as people are,
they're willing to spend the money and they're
not willing to go travel overseas and spend
$20,000 on a trip and they're willing to go to New York for half of that,
then they're going to spend that money incrementally in Broadway shows.
Yeah,
I'm glad you're able to give that context of how inflation
and really affects all of the different facets of the industry.
But switching gears here,
are you seeing the same kind of effect happening throughout entertainment
when you look at things like concerts and other live events?
Yeah, without question, it costs so much more, you know,
with all the rules and regulations around a micron and uh and obviously Covid,
you know, the bigger picture,
you're you're seeing a tremendous amount of costs that have gone up.
I mean just to put on concerts just to
travel to rent out the theaters and the stadiums,
every single aspect too,
everything in life has gone up and that trickles down to the end user, the consumer.
So if it's Hollywood, you know,
I have friends who are in production in Hollywood and
I know for a fact that those costs have soared,
getting places locations, getting people to be, you know,
compliant to covid restrictions that Hollywood
has tremendous restrictions on Covid,
just the food at these production places, you know,
to to just to put the food out for the theaters.
I mean for the production is gone up.
I mean every single thing has gone up and that trickles down.
So the amount of money that these movies are making
their not as much as they used to be.
Um and quite frankly, you know, because people are are doing streaming and so on,
The profits are not there as much.
And I'll be surprised if we see blockbuster movies coming out in the
near future just because the profitability is not their for these movies.
Really interesting stuff there.
That's Ed Butowsky, managing partner at chAP would investments.
Thanks so much for joining us.