Showman Defends Style as Curtain Falls at Center

‘Walt Disney once said you’re not a success in Hollywood until you owe $1 million. ‘

--Milt Larsen, owner of the Variety Arts Center

If Milt Larsen had his way, more people would recognize the Walt Disney in him. His biggest problem is that he aimed beyond financial success. He had dreams, big dreams.

To see the magic, you have only to look to the old Victorian home he refurbished in the Hollywood Hills--the Magic Castle. Crowds of 300 to 500 now funnel through the secret entryway every night, into an otherworldly kind of club of darkened parlors and slick professional sorcerers.

The acts change every week, but it is always Larsen, behind the scenes, pulling the strings.

These days, however, the congenial showman is having to defend his visionary style. While the Castle still thrives, Larsen is being forced to close his Variety Arts Center, an 11-year-old monument to Vaudeville at 9th and Figueroa streets downtown.

It is a place that is quintessentially Larsen, according to those who have worked there. It has a 1,000-seat stage theater, a restaurant, theme bars and a museum commemorating live entertainment. It is a one-of-a-kind place that Larsen shaped with his own saw and hammer, a place of stained glass and ancient elevators, where the wall photos and posters peer out from another era.

Around any corner you may find W. C. Fields’ trick pool table, Jimmy Durante’s “break-apart” piano that he liked to destroy on stage or Spike Jones’ old cello, among other collectibles.

Under Larsen’s guiding hand, the seven-story nightspot--once considered important to downtown redevelopment efforts--has gone down like a shipwreck, one former employee said. The center, with debts of $2.5 million, is bankrupt, Larsen acknowledged. Last week, Larsen disclosed that he is selling the building to a Los Angeles firm that plans to use it for offices.

If that deal goes through next month, Larsen hopes to play Houdini: He will take the $3.2 million from the sale, pay off his debts and escape to Hollywood, where he is now negotiating for a smaller, easier-to-manage building in which to rebuild Variety Arts.

A Creative Genius

As the curtain closes, however, detractors are wondering what went wrong. They point to the man who built it, a 56-year-old, part-time TV gag writer. Larsen, they say, was the creative genius who propelled it, the gentlemanly former magician who will ultimately cause it to disappear. All that the center is--and all it has failed to be--are the results of the unorthodox Larsen touch.

“It was one man’s personality--he built a dream,” commented Janet Allyn, a former employee who saw the worst of the Larsen influence. She said Larsen scheduled stage acts that he could not afford and stubbornly ignored professional advice that almost surely would have turned it around.

“The nuts and bolts of the way a business is run are not important to him,” Allyn said.

Larsen acknowledges that he is no business whiz. Like the man pictured on his necktie, Stan Laurel, he will take the slaps for that. He began a practice of paying monthly bills out of federal income tax withholdings, just one of the many problems--a “total error of judgment,” Larsen says now.

A Decade of Work

Yet he still has a trick or two up his sleeves. This is, after all, just an elaborate and eccentric hobby. When he created his nonprofit Society for the Preservation of Variety Arts, Larsen took on a decade of full-time work, battling one crisis after another for a staff of 40. And he was never paid a dime.

Watch his hands. Watch his lips. He is about to define his place in the world.

“When you talk to people--particularly dyed-in-the-wool business people--and you say you’ve spent 10 years of your life laboring on a love, they absolutely can’t understand it,” Larsen said. “It’s the old W. C. Fields syndrome, ‘You can’t cheat an honest man.’ Everybody thinks I’m crazy.”

The cavernous fourth-floor dining room reverberates with tunes from an old Wurlitzer jukebox--raspy versions of “Seventy-Six Trombones” and “New York, New York”--as Larsen finishes a salad and a glass of wine.

Rising now to tour his dream, his mood seems to lift as he points out one feature after another.

Across the walls of the dining room and the adjoining bar--the Earl Carroll Lounge--hang hundreds of plasterboard squares, splashed with the signatures (most of them original) of some of the biggest names in entertainment: Michael Jackson, Milton Berle, Johnny Carson, Betty Grable, Gary Cooper and others. The salad bar was once a dance prop for Barbra Streisand in the musical “Hello, Dolly!”

He cheerfully greets the elevator operator and descends to other levels and other artifacts. On a balcony overlooking the lobby, Larsen shows off the sculptured bar from the old Masquers entertainment club in Hollywood. Moving into the second-floor library, smiling, he calls attention to hundreds of old phonograph records, thousands of hours of audiotapes from old radio shows and shelves and drawers crammed with countless stage skits and jokes and theater playbills.

“It’s amazing how things have changed in the last 50 years of entertainment,” Larsen said. “The comedians, the jugglers, the fire-eaters, the acrobats, all the people who were the variety performers--it’s a culture. You can really trace the entire history of the country in folk art.”

All this was a part of his childhood, a part of his entire life, Larsen said.

Born in 1931 to two stage magicians, Larsen and his older brother, Bill, got their start in magic at the ages of 8 and 11, playing in a family lounge act that toured resort hotels in San Diego, Carmel and Palm Springs. The experience lasted only three years, before World War II, but for long afterward their father ran a Los Angeles magic shop and talked of opening a social club for magicians.

Fascinated by entertainment, both brothers entered television, teaching themselves TV writing by fishing out discarded scripts from a network trash can.

Home in Montecito

Milt Larsen latched on with NBC and found his way to the game show “Truth or Consequences,” where he spent 18 years. Bill Larsen became an assistant producer for CBS and handled the financial end of such productions as “The Danny Kaye Show” and “Playhouse 90.”

Unlike his brother, who settled down and raised four children, Milt Larsen remained a bachelor. When he is in town from his ocean-view home in Montecito, he stays at Bill’s home in the Wilshire District. Mustachioed and urbane, Milt Larsen has always had a flair, his friends say. He is quick with a quip or to act on a whim.

One day in the early 1960s, nearly a decade after his father’s death, he was driving through Hollywood and saw an abandoned Victorian house overlooking Franklin Avenue. The owner agreed to let him fix it up and lease it for a small percentage.

“I was a kid, 26 years old, writing for ‘Truth or Consequences,’ ” Larsen recalled. “I went in and really opened the Castle with nothing except a hammer and saw.”

With his brother as a partner, Larsen built the Magic Castle into a triumph that made them both wealthy. Today it is one of the most successful private clubs in the world, he asserts, with nearly 6,000 members who pay $750 a year to belong.

Giant Hologram Display

The partnership became vital to it. Bill Larsen handled the finances and membership. Milt Larsen looked after other matters, such as the secret doorway, the sinking bar stool and the self-playing piano. He put in stained glass and Tiffany windows and is now designing some kind of giant hologram display.

“Milt is the creator, Milt is the genius,” Bill Larsen said. “All of the beautiful antiques in the Magic Castle belong to Milt. I’ve invested in things like a retirement plan; Milt has plowed his money back into his enterprises, into things . . . like the Variety Arts Center. Goodness knows what he will do next. Who would have thought to take a seven-story building, in a not-very-good part of town, and turn it into a center for the variety arts?”

Milt Larsen looks back on the discovery of that building--a 1924 Italian Renaissance structure that was owned by the Friday Morning Breakfast Club, a social group of mostly elderly women--as a temptation he could not resist. “It was 65,000 feet of the greatest challenge I had ever found in my life,” Larsen said.

Some might say the road to trouble began the day he moved in. His brother, his business half, stayed behind at the Castle to manage operations there. Bill Larsen said he saw problems with the layout of the new building, with theaters and lounges on different floors, connected by slow-moving elevators.

Eventually, the slow pace of downtown redevelopment also became a problem. South Park, an area of six square blocks just south of Larsen’s building, was supposed to become an emerging residential community of 3,000 condominium units, said Jim Wood, chairman of the Los Angeles Community Redevelopment Agency. Those condominiums and newly built office towers were expected to fuel Variety Arts.

But the development of South Park is at least two years behind schedule, Wood said, and only 200 units--now renting as apartments--have been opened.

Even so, Larsen has taken most of the heat for the center’s problems. The difficulties began with tax debts to the Internal Revenue Service, according to Allyn, a former management specialist who was brought in in 1986 to try to stave off bankruptcy. She said Larsen failed to promote performances adequately and declined to lease out portions of the huge building even when deficits were running $30,000 to $40,000 a month.

Fund-raising was lax. He struggled with personnel problems. He confused the books by neglecting to keep track of his own free meals and drinks, Allyn said.

“Any problem that any company has ever had, Variety Arts Center had--all at the same time,” she said.

For years, even by his own account, Larsen kept it all going with mirrors. He took out loans, paid only the debts that were most pressing and cut costs by enlisting help from volunteers. It was partly his “artistic, living-on-a-cloud quality” that inspired those around him.

“It was Milt’s place, but we all put our hearts and souls into it,” Allyn, his strongest critic, remembered. “We were determined to see it succeed for him, which says a lot about Milt’s charisma.”

‘It Takes Time’

In his own defense, Larsen said that a conventional businessman might have given up on the project long ago.

“We were not operating as a good financial ship, I totally admit to that,” he said. “In some cases, we brought in people we thought could do the job and they couldn’t do the job. In some cases, we brought in people we thought were honest and they weren’t honest.”

But it took 10 years to get the Magic Castle off the ground, Larsen said. “It takes time. The Magic Castle just had its 25th anniversary. It’s probably the most successful private club in the world. You don’t run this type of operation like a shoe store or a bank or anything else. There’s nothing logical about it.”

The Castle was nowhere near “the monster” that Variety Arts became, said John Shrum, a director on the seven-member Variety Arts board. Variety Arts was huge and needed work on essentials such as plumbing and stairwells. Working capital, scarce in the beginning, evaporated like smoke. “To Milt, you do the right thing . . . and you worry about the money later,” Shrum said.

Those worries piled up as the center fell $1.2 million in debt to the redevelopment agency. Faced with a plumbing overhaul, Larsen took out his first CRA loan, for $800,000, in 1984. He could not make even the first repayment later that year.

Larsen dealt with the problem by selling a parking lot and development rights to the agency. That deal brought him $943,000--enough to clear the loan and to pay off $143,000 in overdue federal taxes, CRA spokesman Mark Littman said.

‘Always Had a Story’

But soon other loans were needed. In 1986, he took out one CRA loan for $800,000, another for $176,000. CRA board members handed them over because they wanted to believe that Larsen would make it work, according to Wood.

“Milt always had a story,” Wood recalled. “He always pulled a rabbit out of his hat.”

But the act was becoming trickier. Due to falling confidence in Larsen’s leadership, the agency insisted that an outside business manager be brought in. Enter, stage right, Janet Allyn in early 1986, an assertive, pragmatic former manager of the 1984 Olympic Arts Festival.

“She was very good,” Larsen said, except for one thing. “She had no idea what we were doing.”

For a while, the two disparate spirits--”oil and water,” one Variety Arts board member said--appeared on the verge of symbiosis. Record keeping was improved. Another specialist, Lorre Sloan, was brought in to handle marketing and promotion.

One idea that showed promise was to run a dinner theater and bring in tour groups, Sloan said. Some tour operators seemed excited about the plan, she said, but they wanted improvements in the food and a higher-class feel to the restaurant.

The idea lagged partly because of money and partly, Sloan said, because Larsen did not want it “slicked up.”

“He said that isn’t me--that isn’t who I am,” she remembered.

Larsen resented compromises with his overall vision. In his own mind, nostalgia was not meant to be polished, board member Shrum said.

Tension within the organization grew, but subtly. “He never got angry--he never did that,” Allyn said.

Sloan recalled that even as debts became staggering and pressures pushed at Larsen from every direction, he remained the thoughtful visionary. “Milt told me once, ‘Every once in a while everything closes in on me, and then I drive down to the beach and sit and think, what difference will it make in 100 years?’ ” Sloan said.

He seemed, at times, to even thrive on the pressure.

‘Milt Larsen’s Ballgame’

A breaking point occurred in the eighth month of Allyn’s tenure. She was unhappy with a young manager who had been a protege of Larsen. As Allyn recalled, she believed that the employee was unqualified for his expanding role in the center.

With Larsen’s approval, she said, she fired the young manager. But soon afterward, Allyn left town--and Larsen welcomed him back aboard.

“That’s when it finally occurred to me, it was Milt Larsen’s ballgame,” Allyn said.

Sloan, an ally of Allyn’s, recalled watching the drama with conflicting emotions. Milt treated his employees like family. The young manager was likable. “On one level, I was really glad when he was reinstated,” Sloan said. “But on a business level, I said, ‘Uh oh.’ ”

Allyn left, then Sloan.

After Allyn left, the CRA moved to foreclose on the loans, saying that Larsen had violated his agreement to retain third-party management. The agency’s action forced the center into bankruptcy and Larsen into efforts to sell the building. The Variety Arts Center was headed the way of vaudeville.

“Somehow, in my naivete, I really thought their patience should outlast anyone’s,” Larsen said, looking back at the CRA’s role with Variety Arts. But “their whole position in life is money, money, money.”

Bitter? No, he said; he has another dream now. It lies in Hollywood. At one of several places he is looking at for the new home of Variety Arts.

“I haven’t lost any of my enthusiasm,” Larsen said. “They’ve many times said that I’m a dreamer. Well, it’s true. It takes a dreamer. Walt Disney was a dreamer, and nobody hated him for having dreams.”