In the rough-and-tumble New York real estate world, the commercial and nonprofit theatre communities have each had their share of turbulence. Some tales can be downright shocking: At a recent Columbia University conference on the future of the New York theatre, Julia C. Levy, the Roundabout Theatre Company's executive director for external affairs, talked about facing eviction seven times and surviving. The jaw-dropped crowd was amused and appalled.
Whether due to the recession or other factors, the last few weeks have revealed unusual activity in terms of theatres and real estate. One midtown building, known for its tapestry of theatres and rehearsal spaces, is refusing to renew leases for two nonprofits--and not because the owner wants to up the rent. Elsewhere in midtown, a hotel owner with no previous experience running a theatre is about to invest hundreds of thousands of dollars to build a state-of-the-art performance complex.
Making Mint Move
When artistic director Jonathan Bank assumed the leadership of the Mint Theatre Company, the small nonprofit had fallen on fallow times, owing over $50,000 in back rent on its space at 311 W. 43rd St., a 1913 building once housing presses for Charles Scribner & Sons. The building's present owner, Juniper Associates--more specifically, Dick Berry, one of the partners--took a likening to Bank and did the unthinkable: He lowered the rent and cleared away the debt.
But the offer, of course, was not without preconditions.
"Dick had begun negotiations with Manhattan Theatre Club," Bank says, "and they needed two contiguous floors. So one day he called me into his office and asked if we could move to another space in the building. He added, 'I'll wipe out your back debt.' Who would even think about what to say? He believed that I was honest, he gave us a fresh start, and he gave us a chance to succeed."
Then the plot thickened.
"Three months later," Bank recalls, "I got another call from Dick, and he said he changed his mind. I think he had made some deal with MTC, and this time, we didn't have to move at all--and he kept the terms of the deal as they were. He's a really good guy."
The Mint has succeeded dramatically ever since. Specializing in "worthy, but neglected" plays, their revival of "The House of Mirth" by Edith Wharton and Clyde Fitch captured a great deal of critical attention, followed by raves for such productions as A.A. Milne's "Mr. Pim Passes By," and just last season, Harley Granville-Barker's "The Voysey Inheritance." Season to season, the Mint has grown financially and artistically--and had Berry booted Bank, it likely never would have happened.
This summer, Bank called Berry to discuss renewing the Mint's lease, up in August 2003.
"He said 'you have no future here, and it's not about the money'," Bank says. According to Berry, it's about the "proper use" of the building."When we bought this building," Berry says, "we wanted to give it a funky, downtown quality-architects, video, theatres. We did not want it modernized into this glossy, characterless building. We tried to keep the rents as low as we could, and attract the type of people who would be attracted to this type of building."
What happened, however, was not unlike what happens when bees sense honey. As the number of theatres in the building grew, the number of performances and productions grew as well. Tenants, naturally looking to defray expenses, began subleasing space in accordance with the terms of their lease.
All the resulting traffic, says Berry, added up to big headaches and mounting worries. "At first," he says, "if there was a show in the building on a Saturday or Sunday, it sort of blended in with what we were having in the building. Then there were a lot of people in the building, and we didn't know who they were. It began to scare the hell out of me. If something happened, we didn't have a crew there. People would go into the bathrooms and put paper towels down the toilet and there would be leaks." While Berry asks companies like the Mint to provide an on-premises staff member for sub-leasees--and while he acknowledges their compliance with that request--"[these companies] can't afford to take care of people causing leaks and smoking in the halls and stairwells.
Plus, just to deal with my paranoia, we brought guys in, security, on Friday night, on Saturday night. At least with MTC, they have a staff--when something is going on, somebody's there. If they have a show in rehearsal, we know whose coming, and it's their actors, not 70 audience members. As the owner of a building, I'm scared when a building is operating on a sort of free basis. I can't realistically check IDs or anything, and after 9/11, you have an additional liability, to let people in or not. I just can't feel comfortable with 90 or 180 people coming in at 7:30 pm."
Berry concedes that there's at least a little bit of economics to his decision, especially as Hell's Kitchen emerges as one of Manhattan's hottest redevelopment areas. "If all the rent was paid, all we did was break even," he says.
In addition to the Mint, The Directors Company's lease is up next summer, and they are already looking for a new home. The Melting Pot Theatre Company, which was subleasing space, has already moved uptown to the McGinn Cazale Theatre.
Despite his decision not to renew these leases, Berry considers himself a friend of the arts and a fair man. "I've always taken the position that we're not landlords, we're owners," he says. "We have a sense of stewardship. We like to be able to look our tenants in the eye and meet them as friends."
But does Bank still think of Berry as a friend? On the one hand, yes: He's indebted to him for helping out when the Mint's monies were low, and he extended an extraordinary set of breaks in the middle of boom times. Yet once the Mint and The Directors Company are gone, the only theatrical company left in the building will be MTC's mixture of offices and rehearsal rooms. In an ironic example of the endless, timeless New York battle between haves and have-nots, MTC may well be gearing up to take over the Biltmore Theatre, located just a few blocks to the north, at precisely the moment the Mint becomes homeless.
As he scours for space, Bank is determined to stay in midtown. "We have a strong core audience that might follow us somewhere inconvenient, but we really want to stay in the theatre district," he says. Bank and his board have also begun improving their efforts at getting grants--currently comprising about a third of their budget--as the search begins.
"The truth is, I'd rather not think about real estate and I'd rather not solve the real estate problem," he says. "But what can I do? It's his building."
It's possible, though by no means certain, that when Mint moves in mid-2003, a new nonprofit theatre complex on the East Side may be opening.
The project was simultaneously announced with the sale of the Hotel Delmonico, on Park Avenue and 59th Street, to Donald Trump for $115 million. Managing partner Elysabeth Kleinhans plans to take her share of the proceeds and build three theatres on the adjacent property, which she continues to control.
Kleinhans' mother, Sarah Korein, was a legendary New York real estate mogul. During the Depression, Kleinhans says, Korein acquired mortgage notes for defaulted properties at ten cents on the dollar, figuring the land would someday be worth far more than the purchase price. With the land under Lever House and One Penn Plaza just a few of her portfolio items, she was right.
Kleinhans, meanwhile, has already had several careers, having earned degrees in law and psychology, dabbled in interior design, and risen high in the world of library science. "I wanted to know a little about everything," Kleinhans says, "and I wanted to know a lot about a lot."
In the early '90s, Kleinhans was asked by her mother to manage the hotel, and she agreed. Soon after, she developed a keen interest in theatre, and though older than your average, new-to-New York thespian, took classes at HB Studio, started directing, and formed a nonprofit company, Animated Theatreworks, to focus her creative energies.
Ever since, she says, her dream has been to own a theatre. Having decided to put the hotel on the market, she then created a foundation, which will own the two-story, double-height property as well as the theatrical complex soon to be built inside it.
"We're shoehorning three theatres," Kleinhans says. "There's a 50-seat flexible black box for workshops, a 99-seat house for showcases, and a 199-seater for Off-Broadway work." Kleinhans is working with a team that includes architect Leo Modrcin on the complex.
"My feeling is, somebody wonderful is going to come into here and they're going to do a workshop production and it's going to be so great that they're going to move it to the 99 and there, I hope, it's going to be such a hit that they're going to move it downstairs. That's my dream," she says.
As for the notion that starting a nonprofit in a recession is nothing but an uphill climb, Kleinhans is philosophical. "You know, it's not such a great time to be in a profit-making enterprise either. Just try being in the hotel business after Sept. 11th."
To be sure, Kleinhans doesn't need to worry about funding-the proceeds from the hotel sale will largely fund the building costs, and perhaps some production costs as well. And while Animated Theatreworks has already done some professional work thus far--they mounted a recent showcase at the American Theatre of Actors last spring--Kleinhans plans to rent out the space to companies, especially those wishing to do new work.
"Plenty of companies are looking for space, and this will be the kind of space that's hard to come by," she says. "I'd rather rent to someone for a wonderful new play than something done all the time. What I'd also like to have is enough mainstream-ish stuff to attract people, and then they would come in and see that there's something else going on in this theatre over here or there, something that they wouldn't necessarily have known about, for only $15."
"I'm a very practical person," Kleinhans says. "I don't say I know everything, but I'll learn. I have all these really practical questions...like, how do I get cleaning services?"