Has the Milwaukee Symphony Orchestra Bitten Off More Than it Can Chew?

With ambitious plans to convert a long-vacant movie house into its new home, the Milwaukee Symphony Orchestra may be in over its head.

A closer look at the gilded columns. Photo by Adam Ryan Morris

Mark Niehaus stands inside the dusty Warner Grand Theatre on West Wisconsin Avenue, its gilded ceilings and elaborate art deco flourishes surprisingly well-preserved. Niehaus knows that this historic former movie house, dormant for more than two decades, could be the lifeline for the Milwaukee Symphony Orchestra.

“I made a promise to our donors that we would find a way to run without the need for extraordinary angel gifts to fill deficits every year,” says Niehaus the MSO’s former principal trumpet who became president and executive director in 2012. But an extraordinary sum of $120 million is what the symphony will need to rehab the theater building, pad the endowment, provide bridge funding and executive a pension buyout. If all goes as planned, the MSO would begin playing in the theater, which is said to have excellent acoustics, by fall 2019. Niehaus claims that he has secured commitments for about half the total sum (although no one will confirm on the record the identities of the major donors), and several sources are convinced the MSO will succeed in raising the targeted amount.

That remains to be seen. But the real question is, will owning its auditorium make the MSO solvent in the long term?

Financial crises have been frequent occurrences for the organization. Just three years ago, the Symphony had to raise $5 million within a few weeks in order to avoid bankruptcy, and in 2010, it clawed back from a $2.3 million deficit. In late 2016, during this fundraising effort, the Symphony also restructured its management team. This led to the elimination of the position held by Ian Harwood, who served as vice president and chief operating officer.

The MSO’s desire to boost its earned revenue – money from ticket sales – is the main driver of the planned move. In its own theater, the symphony could play more weeks because it wouldn’t compete with the schedules of the Milwaukee Ballet, the Florentine Opera and the Marcus Center’s Broadway series. It could also generate additional revenue from concessions and rentals, despite having 555 fewer seats to fill (the renovated theater would feature 1,750 seats, compared with 2,305 at the Marcus Center’s Uihlein Hall). “The Milwaukee Symphony Orchestra is one of the only major symphonies in the country without a dedicated hall,” Milwaukee County Executive Chris Abele says. Abele’s family’s Argosy Foundation donates $250,000 to the MSO annually and, over the years, has donated upwards of $7 million. He thinks the Warner Grand fundraising effort is realistic, and puts “a big stake in the ground” for additional commercial and residential development in Downtown Milwaukee. Mayor Tom Barrett is also “hopeful” that the MSO can raise the necessary funds to transform the theater. “The project would be a huge benefit for the MSO, West Wisconsin Avenue and the entire city,” he says.

Renowned soprano Renée Fleming performs with the Milwaukee Symphony Orchestra in May 2016. Photo by Jonathan Kim/Milwaukee Symphony Orchestra

There are other reasons to be optimistic. The Symphony achieved a balanced budget for 2015-16 while reporting new sales and attendance records and a 32 percent gain in new patrons compared with the prior season. Based on its annual report, revenue from ticket sales rose 1.5 percent to $3,146,000 in fiscal 2016. But ticket sales accounted for just 18 percent of the MSO’s total operating revenue of $17,415,000 in fiscal 2016. Niehaus defends this figure. “There is not a symphony on this planet that only exists on ticket sales, especially in the United States,” he says.

The MSO’s occasional financial woes are certainly not unique; orchestras across the country face numerous obstacles, including reduced funding and intensified competition for donors and patrons, aging audiences, and high payroll costs due to the large number of musicians required. Citing financial trouble and a drop in attendance, the Green Bay Symphony Orchestra folded at the end of its 2014-15 season. Musicians at the Philadelphia Orchestra, which filed for bankruptcy in 2011, conducted a brief strike in October, as did the Pittsburgh Symphony.

For some arts groups, owning and operating a building isn’t always what it’s cracked up to be. Just look at the Skylight Music Theatre, which in August announced it was considering a possible sale and leaseback of the Broadway Theatre Center in the Third Ward, its home since 1993, in order to address recurring fiscal issues. Andy Nunemaker, the MSO’s current board chairman, rejects the comparison. “I don’t think it’s relevant,” he says. “It’s a very different model and the scale of what they are doing in that space is totally different.”

Niehaus knows a new building alone won’t be enough to attract crowds. To help expand its audience, the MSO recently performed the score during showings of the movie Harry Potter and the Sorcerer’s Stone, and has launched a series of pop-up concerts to reach nontraditional audiences.

The MSO is also faced with another crucial decision – finding a replacement for music director Edo de Waart, who is slated to leave his post as principal conductor and music director at the end of this season. “He’s a tough act to follow,” Niehaus admits. His salary is also a substantial budget line. De Waart earned a base salary of more than $402,000 in 2014, according to the Symphony’s latest publicly available Internal Revenue Service 990 tax form. That same year, Florentine Opera General Director William Florescu had a base salary of about $144,000; Milwaukee Ballet Artistic Director Michael Pink received $151,000; and Milwaukee Repertory Theater Artistic Director Mark Clement $195,000. In the world of professional symphonies in similar-sized cities, however, de Waart’s salary isn’t notably out of line.

But what of the Marcus Center? The MSO’s planned departure would cause a major financial jolt for the performance hub, which would lose about $850,000 per year in revenue. “It potentially impacts every group here,” cautions Marcus Center president Paul Matthews. It must be assumed, he says, that the MSO won’t be a tenant in the building by the 2019-20 season.

Across the river, a block east of the Grand on Wisconsin Avenue, a new marquee beckons crowds to the Riverside Theater, a nearly 90-year-old concert hall. Gary Witt, president of PTG Live Events, which manages the Riverside, Pabst Theater and Turner Hall, calls the Symphony’s planned move “brave and courageous,” if risky. “It’s a very big risk for them to move their audience to another place,” Witt says. “That theater has been a black hole for a long time.” ◆

‘The Next Movement’ appears in the March 2017 issue of Milwaukee Magazine.

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Rich Rovito is a freelance writer for Milwaukee Magazine.