Disney to Try Developing Site of Aborted Burbank Mall

Burbank officials announced Friday that they plan to give Walt Disney Co. the go-ahead next week to develop plans for a multimillion-dollar retail and entertainment complex on the site of the failed Towncenter shopping mall project.

City officials said Michael D. Eisner, Disney’s chief executive officer and chairman of the board, will unveil specifics of the proposal at Tuesday night’s City Council meeting, when council members are expected to approve an agreement that would offer Disney a bargain price for the 40-acre site.

Disney executives have been talking with council members and City Manager Bud Ovrom since February about developing a “festival shopping center” on the downtown Burbank property. Unlike traditional shopping malls, it would have a variety of shops, boutiques and restaurants without being anchored by major department stores.

“The Disney Co. has been talking about creating an all new ‘animal,’ which would combine the best aspects of a festival shopping center together with a significant entertainment element,” Ovrom said Friday in a written statement to the council.

“Disney is in a unique position to invent something totally revolutionary that will blow the socks off of the traditional shopping malls,” he said.

$150 Million to $300 Million Cost

Ovrom said the complex might include commercial offices, a hotel and media-production facilities, and would cost between $150 million and $300 million.

“It is important to note that it would not be a ‘gated’ facility such as Disneyland or Magic Mountain,” Ovrom said.

The agreement the council will consider Tuesday stipulates that “the general public would have free access to the retail portion of the proposed development while the developer may limit public access to the entertainment portion by charging admission.”

Ovrom said Disney would pay $1 million for the property, or 57 cents a square foot. Under the agreement with Towncenter developer Ernest W. Hahn, the city was selling him 30 acres for $1 million and hoping to sell the additional 10 acres for $8.7 million.

“We should be candid and note that there are plenty of developers who would probably be willing to pay $20 per square foot, or $35 million for the site,” Ovrom said. However, those developers would “probably want to do more traditional types of retail” shopping centers.

“I am convinced the Disney development has greater potential to generate more revenue and economic spinoff for the city over the long haul than any traditional center,” he said.

Apart from property taxes, the project would generate between $1 million and $3 million a year in revenue for the city through sales taxes and other sources, Ovrom said.

Disney officials declined Friday to give details of their project.

To Negotiate Agreement

At Tuesday’s meeting, the council will consider an agreement with Disney to negotiate for the 40-acre site. Under the agreement, the city could not negotiate with any other developer, and Disney would have to come up with a design, parking layouts and construction schedules within six months. Further plans and revisions would be drawn up in the following six months.

Either side could pull out of negotiations after the 12-month period if there is any dissatisfaction with the final plans.

The city is still reeling from the collapse of Towncenter, a redevelopment project that had been in the planning stages for more than 10 years. The $158-million project began to fall apart last year when a Robinson’s department store was pulled out of the center after another major department store chain, May Co., merged with the parent company of Robinson’s, Associated Dry Goods.

Hahn was unable to find a replacement store, and the other department stores committed to the center--The Broadway, Nordstrom and J. C. Penney--said they would drop out.

“Perhaps the hardest lesson we learned from the Hahn Towncenter experience is that we cannot realistically expect to compete head-to-head with the Glendale Galleria,” Ovrom said. “We are too late and it is too large and too successful. If we are going to have a viable retail element to our downtown, we have to find our own niche to fill in the marketplace.”