Feb. 16, 2006
'It Didn't Have Spectacle'

‘Avenue Q’ was supposed to represent a new era of Broadway theater in Las Vegas. Hotel mogul Steve Wynn explains why the show is closing early.

[Hear the interview in its entirety here]
[See Newsweek piece on Avenue Q's Vegas woes here]

By Steve Friess
NEWSWEEK WEB EXCLUSIVE

Las Vegas hotel mogul Steve Wynn rarely gets 'em wrong. In the 1980s and '90s, the developer of such famed properties as the Mirage and Bellagio made Strip staples out of Siegfried and Roy and Cirque du Soleil. That's why when he said he was ushering in a new Vegas era by bringing the Tony-winning musical "Avenue Q" to his $2.7 billion Wynn Las Vegas resort last year, many believed he could singlehandedly will Vegas audiences into taking an interest in more thoughtful theater.

But after five underwhelming months for "Avenue Q" in Vegas, Wynn announced Wednesday he'll close the bawdy puppet show in May, even though he paid $5 million for the exclusive North American rights outside Broadway. Its theater will be reworked for the arrival of another Broadway hit, "Spamalot," scheduled to open next February.

Wynn, who originally had planned to build a separate theater for the Monty Python production, spoke to Steve Friess about "Avenue Q"'s early demise. Excerpts:

NEWSWEEK: So what happened here?

Steve Wynn: I'll give you exactly what happened. We're in the approval phase to break ground this spring on Encore [a new resort attached to the Wynn]. Among other things, it will have about 80,000 square feet of convention space. The costs associated with the planned "Spamalot" theater would have come to about $85 million, and it would have meant that the new convention space wouldn't be contiguous to the existing space in Wynn Las Vegas. But it would only cost $10 million to renovate the "Avenue Q" theater to make it ready for "Spamalot" and put the convention space there, where it would be contiguous with the rest.

So you close "Avenue Q," which wasn't making money?

"Avenue Q" has been making money for the past four or five months, but it's hovering in its attendance at a level that doesn't approach making the kind of money that I could save by not building the second theater. It came down to a real-estate strategic decision and a simple measurement of money.

What was the occupancy of "Avenue Q"?

It was bringing in 6,000 to 7,000 people a week as opposed to the 10,000 or 11,000 we'd hoped. We were at about 50 or 60 percent. That's the trouble.

You once told me, "You can't go broke with a show like 'Avenue Q,' but you can make a lot of money." You said you only needed 30 percent occupancy to break even.

That's right. We made money with "Avenue Q" every night. But not enough.

Why do you think "Spamalot" will do better?

It's completely different. "Spamalot" is a big, rock-'em, sock-'em Broadway show. "Avenue Q" is almost off-Broadway. It's a very inside piece of business.

Was "Avenue Q" too challenging for Las Vegas?

Not too challenging. But in a city that's very bombastic, it takes a while for something understated to sink in. We have an audience that turns over 2½ times a week and they're only here two or three times a year. So word of mouth here is a much slower proposition than in New York.

A lot of people did predict that problem.

Listen, anybody who tells you they have a crystal ball is giving you a story. I thought it would be well-received, and it was. There's been repeat visitation up to wazoo. But in terms of it competing with things like [Cirque du Soleil's] "O," it didn't have the spectacle. When people come here, they want to catch the biggest and most spectacular thing. So how does a puppet show get to be a priority? I thought we had a chance to develop a niche market in Las Vegas. And it was on its way to doing that, but I just had to make this decision now.

How did it go when you told the "Avenue Q" producers you were pulling the plug?

[Executive Producer] Kevin [McCollum] was disappointed. I'm disappointed. No one's more disappointed than I am that Las Vegas didn't just go absolutely head over heels about it, but what am I supposed to do?

But you had a one-year contract.

Yes. It would've been up in August. By stopping May 27, we added up all the shows between then and August and I paid them $15,000 a show. It wasn't that much money, but it was a fair thing to do. I mean, I was saving $75 million.

"Avenue Q" was the leading edge of a Broadway invasion of Vegas that includes "Hairspray," which opened Wednesday, "Phantom of the Opera," which opens in May, and "Spamalot." Do you think this will chill some of that excitement?

No. The decision to come here is because of the money. If producers think they can make the most money in Las Vegas, they'll come here. If they think they can make more on the tour, they go tour and tell the Las Vegas guys, "I'll see ya when I'm done if you still want me."

You and I saw "Avenue Q" together when you first saw it in your theater. You seemed out of sorts by the quiet way the first act ended. My impression was that you were saying in Las Vegas, it's strange to send the audience out in intermission on a down note. That in Vegas, you don't want to leave the audience, um, thinking.

Well, an intermission is artificial. They were invented so theater owners can make money on drinks and food. Intermissions have nothing to do with artistic vision. In fact, they destroy it. You have to write a special song just to start the second act. But I could not convince the creators of "Avenue Q" to do the show without an intermission until late in the game. [The intermission was cut and the show shorn to 90 minutes in January.] We lost 3 or 4 percent of the audience at the intermission. We interviewed the people as they left. "Why are you leaving? Don't you like the show?" "Oh no, we think it's terrific, we just gotta go." Isn't that interesting?

It really is, considering they spent $100 each for their seats.

Now, ["Spamalot" producers] Eric Idle and Mike Nichols right away told me, "We don't want to have an intermission."

Weren't you considering bringing in a big headliner like Bette Midler?

Maybe at some point. I'm still not at the point where I'm satisfied that we have a group of entertainers that would make it special. It's a very tricky business, entertainment. It's almost always been pretty good to me.

Hear Steve Friess' interview with Steve Wynn in its entirety at thestrippodcast.com.

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