Tribeca bigger than ever, not quite profitable

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"Last year, I was looking around and saying, 'This is our fifth and final one.' It became just survival," Tribeca Film Festival co-founder Jane Rosenthal says. "The festival has run at a deficit for five years, and there may still be one. I continue to personally take a hit each year."

Joking, she adds, "Do you need a Kleenex now?"

Despite the headaches, Rosenthal knows she's a fortunate woman.

A successful film producer who set out to help her Sept. 11-torn neighborhood, she helped launch the Tribeca Film Festival with husband Craig Hatkoff and her living legend business partner Robert De Niro in 2002. Now in its sixth year, Tribeca, which runs Wednesday through May 6, has become not just one of the biggest film festivals in the country -- but an increasingly important venue for acquisitions.

This year finds the fest exponentially expanding its scope and reach and -- with some controversy that's hit a nerve with Rosenthal -- increasing ticket prices. Perhaps the event's biggest new venture is the Tribeca/ESPN Sports Film Festival (which runs throughout the festival), a 14-premiere feature collection of competition-themed films with subjects ranging from video gaming (Picturehouse's "The King of Kong") to poker (the hot acquisition prospect "The Grand").

The Sports Film Festival's advisory board includes Mark Cuban, Spike Lee and the Farrelly brothers, though the definition of the event as a stand-alone fest, or even as a separate part of Tribeca, is a bit misleading. All 14 features are part of the regular Tribeca lineup, making the grafted-on event more an exercise in rebranding than its own entity. But the addition of a May 5 "Sports Saturday" -- featuring interactive X Games events, mechanical bull rides, tennis clinics, soccer demos and representatives from almost every major New York sports team -- is sure to bring more traffic to a festival that's seen high attendance at its other free outdoor events, the Drive-In and the Tribeca Family Festival.

In another sign of expansion, Tribeca has added three new theater locations (in Chelsea, Kips Bay and the Upper East Side), just as it did last year. But for all of this reach around Manhattan, Hatkoff laments, "We don't have enough theaters downtown, and we don't have a permanent home."

To rectify those problems, Tribeca Enterprises has teamed up with the Related Companies and Cirque du Soleil for a proposed Pier 40 Performing Arts Center. The center would house a large theater for the circus, an ice rink, nightclub, sports field and a 60,000-square-foot Hudson River-adjacent multiplex to run indie films year-round and Tribeca programming each spring. But the $626 million project is far from a sure thing: A competing academic and sports space, Pier 40 -- The People's Pier, also is up for consideration in community board hearings.

Should PAC be approved, Hatkoff anticipates it would be completed by 2011 or 2012.

Yet, such growth feels contradictory in the face of -- as Rosenthal admits -- continually running in the red. No official figures are available on how much the festival costs, earns or loses because, since its second year, Tribeca has been a private, for-profit organization run under the umbrella of the private, for-profit Tribeca Enterprises, which was founded by Hatkoff, Rosenthal and De Niro in 2003. A Tribeca insider does claim that for the past few years, the cost of staging each fest has increased to about $13 million (20% of which is ponied up by the festival's founding sponsor, American Express), and the event has been running a $1 million annual deficit -- which comes right out of Rosenthal's, Hatkoff's and De Niro's pockets.

Hatkoff says that Tribeca now costs three to four times what it did when it was initially conceived in 2002 as a five-day event that hosted some 150,000 attendees. By last year, it had ballooned to a 13-day event and more than tripled in attendance.

"The rationale for a bigger scale is that there are fixed costs inherent in running it no matter how large we are," Hatkoff says, citing the yearlong overhead for staff, offices, ticketing and other expenses. "It's Economics 101. Not having it grow will just exacerbate the cost structure. It's not about making money for the festival."

Still, this year's 50% jump in most ticket prices -- first reported by IndieWire.com -- has caused grumbling in some quarters. Rosenthal points to just how tough the festival is to run: "When we have to retrofit theaters with digital projection and fly more filmmakers in with fewer hotel rooms available than ever before, we have to pay for it. We don't get city and state funding the way (the Toronto International Film Festival), (the Sundance Film Festival) and (the Festival de Cannes) do. I don't even get any substantial funding for free events. Without that, I had to raise ticket prices."

Festival and theater additions, possible construction and rising ticket prices seem to indicate that all of this growth isn't likely to stall anytime soon. And Hatkoff makes no bones about the founders' aspirations. "We should become, if not the dominant festival, then one of the great festivals of all time," he says.

That's a heady goal for an festival originally intended as a one-off to revitalize a neighborhood, which it clearly has helped to accomplish. According to a 2006 Forbes magazine study, the Tribeca area of Manhattan has the highest median home sale price in New York City and the 12th highest in the country -- something many considered impossible in the immediate aftermath of the World Trade Center collapse.

The festival also has had a beneficial impact on the city: Organizers point to the more than $325 million it has created in local economic activity. But the charitable spirit that marked its founding mission often has been overshadowed by its towering ambitions -- a situation that is likely to continue as events like its five-borough premiere screenings of Sony's "Spider Man-3" cast a web over the city on April 30.

There is a method to what some see as Tribeca's madness in growing so quickly. The ESPN collaboration, for Rosenthal's part, was designed with an eye toward becoming profitable and appealing to an audience of 18- to 25-year-olds. That, she notes, is a model that can make the fest profitable. "Is this something we can have travel and generate revenue in the future? That's our goal," she says.

Ultimately, any Tribeca Film Festival profits will benefit the Tribeca Film Institute, an independently run nonprofit co-chaired by Rosenthal and De Niro that coordinates programs throughout the year that culminate during the festival. Currently, the institute runs the Tribeca All Access program, which assists minority filmmakers, and the Tribeca Film Fellows program, for aspiring teen directors.

One indication of moderation is this year's lineup, which has been reduced from 174 to 157 films, with 73 world premieres and 28 North American premieres. It will open with the global warming-themed SOS Short Films Program, hosted by former Vice President Al Gore, and close with the 2005 HBO telefilm "The Gates," Antonio Ferrera and Albert Maysles' documentary about the art project that covered Central Park in orange drapes.

Additionally, recognizing that the festival happens during a particularly busy time of year, organizers have slightly shifted the event's dates to avoid the tidal wave of activity that Cannes presents later in May. That's good news for those in the industry: "We're certainly glad they moved their dates earlier," Warner Independent Pictures senior vp production and acquisitions Paul Federbush says.

In the end, all of this expansion and city impact is just background noise for many in the film business, who value Tribeca solely for its increasingly useful film-market status. "Every year, Tribeca has more and more world premieres that get acquired," Paramount Vantage senior vp productions and acquisitions Matt Brodlie notes. "The addition of (new distributor) Overture Films this year could make for some interesting purchases."

Tribeca also looks poised to benefit from the increased feeding frenzy at Sundance in January. "Prices at Sundance were so out of control, a lot of smaller indies got shut out," WIP director of acquisitions Carl Hampe notes.

Roadside Attractions director of acquisitions Dustin Smith, whose company picked up last year's world premiere "Lonely Hearts" at Tribeca, agrees. "Hopefully, we'll be able to find a great little film without having to worry about the co-dependents driving up all the prices," he says. "My guess is that the only big money being spent at Tribeca this year will be for those new $18 tickets."

Yet, even as those tickets have gone on sale, the buzz about this year's Tribeca fest already seems to have ratcheted up a notch: There's that "Spider-Man 3" tie-in, more stars represented than ever -- both as actors onscreen and as filmmakers behind the scenes -- and perhaps the greatest indicator of success: a minor backlash to call its own.

Rosenthal rides above the criticism: She has no intention of shuttering the festival she calls "my baby" anytime soon -- or of letting it go on without her. "Should someone else raise your child?" she asks. "My 12-year-old can be snarky, but I'm not about to give her away."

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