Why are American theatre producers fleeing to London?

LondonIn a ramshackle old warehouse in South London, with a leaky pitched roof, a stylish but dilapidated bar with posters of past shows, a group of Americans gathered to make a musical about a famous American writer. It was a small show, Beautiful little fool, about the glamorous but tragic marriage of Francis Scott and Zelda Fitzgerald. It featured an experienced American director, American screenwriters, and an American producer who, although they first looked in the United States for places to stage an early production of this show, ultimately chose London for a simple reason: cost.

About five miles from the theatre where Beautiful little fool was performed, another group of Americans spent the first weeks of the year in a rehearsal room working on a much larger musical, The greatest showman, an adaptation of the film about another singular American figure, circus impresario P.T. Barnum. This show, developed by Disney Theatrical Productions, has an almost entirely American creative team, but is now beginning its theatrical life with a sold-out production in Bristol (UK).

For American artists telling American stories, the United States remains the dream and the goal. But the costs of developing and staging shows in the country have skyrocketed: budgets of $20 million – a rare figure a decade ago – are now commonplace on Broadway. And the rates of return have plummeted: so far, only four of the 48 new musicals that have premiered since the pandemic have made money. As a result, investors have become increasingly timid, and this has led to a wave of offshoring that allows producers and artists to refine new works and generate buzz before presenting riskier productions in New York.

"London is full of American producers looking for better value," explains Matthew Byam Shaw, a British producer. Kathy Bourne, chair of the trade association UK Theatre, adds: "There's no doubt we've seen a very clear shift. It's obviously much cheaper to get a production up and running in the UK, so why wouldn't you do it?"

And we're not just talking about musicals. A new play, High Noon, an adaptation of the 1952 westernHigh Noon, originally slated for Broadway, has opened in the West End. A very American story with an American star, Billy Crudup, but with a British audience. "Broadway is everyone's dream, but Broadway is expensive —says Paula Wagner, the lead producer of High Noon—. Doing it in the West End costs half, or even less than half.

Starting a new non-profit musical in an American theater often costs $2 million or more, for the commercial associate producer. Mark Cortale, the lead producer of Beautiful little fool, explains that he considered this option before deciding on London's Southwark Playhouse, where the budget was $500,000.

Why is it so much more economical for theater producers to work in the UK than in the US? American producers say that in the UK, all aspects of their work are less expensive: cast and crew salaries, theater rentals, payments to suppliers. The current weekly minimum wage for an actor in the West End is around $1,219, while on Broadway it's $2,717.

The labor landscape in London is much less complicated than in New York: the Society of London Theatre, which negotiates on behalf of West End theaters and producers, negotiates with three unions, while the Broadway League negotiates with 13 in New York City. Furthermore, union labor rules in the UK are less rigid, producers say, leading to greater cost savings.

Government support is also a significant factor. Unlike the US, the UK has, since 2014, had a national theater tax relief program that returns 40% of qualifying costs as a tax credit to most productions. New York State had a post-pandemic tax credit for shows in New York City, but this program was less generous —it applied to 25% of qualified expenses, with a cap— and ran out of money at the end of last year. Even if it is re-funded, it excludes many productions staged elsewhere in the US.

A more robust theater culture

"On Broadway there are total failures, but in London this doesn't usually happen because the government returns 40% of fixed costs to you," says Eric Kuhn, an American producer who mainly invests in shows in the United Kingdom. "Producers can take on bigger risks and changes." London, like New York, has many well-trained and highly qualified theater artists, which is why producers say they have no problem staging quality productions there. And there are advantages for the public: several producers claim that London has a more robust theater culture, partly because tickets are more affordable, and this makes it easier to attract audiences to new shows with unknown titles.

Chris Smyrnios, artistic director and CEO of Southwark Playhouse, where Beautiful little fool was performed, states that of the 40 shows his theatre staged last year, about eight were produced or funded by Americans. "The message I'm getting is that coming to London, renting a theatre like ours, paying for flights and accommodation for creatives and cast from the United States, is still cheaper," he says. But he also admits he's being cautious because he doesn't want American producers, who spend money, to increase costs for British consumers. "I wouldn't want what happened in New York to happen here," says Smyrnios.

The London theatre scene, especially after the pandemic, is experiencing a moment of splendor. The 47 theatres that are part of the Society of London Theatre attracted 17.1 million spectators in 2024, surpassing the 13.4 million who attended a show in the 41 Broadway theatres that year. "There's no doubt we've recovered more easily from the pandemic," argues Claire Walker, one of the two general directors of the Society of London Theatre. Now, American shows, both small and large, are beginning their theatrical journey in London.