Way too high –
I agree with a lot of the others here that this is not a good deal for you, but I wanted to add one more thing. This is not an unusual financial model in the concert business. My wife runs such an operation here in NC, and the way it works is the promoter rents the building for a set fee, and brings in the talent. Promoter gets the door, owner gets the rent plus 100% of bar/concession sales, and they try and get 25% of merch. They also get 25% off the taco truck parked in the parking lot.
Promoter is also responsible for things like event insurance (the building owner is as well), security, and production (sound and lights). The production costs for the promoter are not much - usually around $2500 to $3500 since these venues cannot usually support really big tours. They pay around $600 for security and other personnel so their real cost is in the band ($25K for a big name). They can then turn around and sell tickets at $50+ and make a great profit provided they have big ticket sales. Cost is relatively low for them other than the band.
Now look at our (the industries) business model. We spend a lot in production ($75k+), and a lot more in personnel, insurance, and other miscellaneous. Our ticket prices are much lower so we need to run many more nights to recoup our expenses. Rent is our biggest expense.
Business right now is really slow for these venue operators because there are not a lot of bands touring anymore so the years of running 45 to 50 shows a year has dwindled down to very few, and none of them very profitable. This means they have to get creative and find other uses for their buildings, but they do not understand our business model.
Travis "Big T" Russell
Big T Productions Inc
Owner and Operator of "The Plague" and "Camp Nightmare"
Customer Quote of the year: "Damn, I pissed myself"