Los Angeles Music Scene: Indoor Venues need 100% Capacity?

This is a dated article, but I just happened to come across it. It deals with the business dynamics for smaller venues. From the Rolling Stone via Yahoo (Feb 26):

Paul Rizzo, owner of Greenwich Village’s 230-person-capacity The Bitter End, says his monthly Manhattan rent is around $22,000, with the next-biggest expenses being employee salaries and insurance. A community GoFundMe helped him stay afloat during Covid-19, but much of that money went toward safety inspections, frontage, real estate taxes, and other things that don’t go away even when the venue is closed. “For a small venue like mine, the only thing that really dictates if you can be successful or not is your rent,” Rizzo tells Rolling Stone, adding that he currently owes his landlord $244,000 in delayed rent.

I'm just going to do a back of the envelope here. The Bootleg Theater has 3 rooms (one, I believe, is being given up by the venue.) The Bitter End capacity is about the size of the Bootleg Bar room. The Bootleg Theater room is about twice the size of the Bitter End. Let just assume that the third room is being abandoned by the Bootleg Theater. Back of the envelope would say that the Bootleg Theater's rent is $66,000 a month. At this point in time, the Bootleg Theater might be behind by close to $800,000 in rent. I would think that real estate taxes would be paid by the property owner, but maybe like The Bitter End, they need to pay those types of taxes. There would also be additional costs such as insurance and electricity that have certain costs even if the venue has been shut down for over a year. I wouldn't be surprised if they owe over $1,000,000.

Let's continue:   

Michael Swier, who co-founded New York’s Bowery Ballroom and also runs the nearby Mercury Lounge and L.A.’s Teregram Ballroom, says his venues don’t have any plans or hopes for partial-capacity shows. “You give us 25, 50, or 75 percent but we have to socially distance? That brings us back down to 15 percent,” he says. “Those numbers don’t really mean anything if there’s a social distancing condition to it. I don’t see us being able to open at all unless the social distancing is gone, but it doesn’t really matter at that point. I think for most independent, GA music venues, 100 percent is probably where you need to be [to profit] . . . 

A discussion with a Los Angeles venue owner (left out was that he also owns the Moroccan Lounge) and it doesn't look good. He needs 100%. The Teragram Ballroom capacity is 625 so they book larger bands then say the Bootleg Theater, Hotel Cafe, and Zebulon. The financial splits are likely much lower for smaller bands and artists. Yet the key here is his belief that even 75% capacity still results in 15% capacity if there are social distancing requirements. So it looks like Los Angeles music venues need social distancing restrictions lifted before it makes sense to re-open. He mentions that his hope is that venues can reopen in the fall.