Shock of Disney Pullout Lingers in Burbank

‘I’m stunned, absolutely stunned. This concept was ideal for the Burbank area. Naturally, Burbank will survive, but it’s a huge disappointment.’

Morgan Suycott, real estate agent

Morgan Suycott was speechless.

Suycott, a Burbank real estate agent, was getting ready to leave his office late Friday when he learned of the Walt Disney Co.’s abrupt decision not to build an elaborate theme park and shopping mall planned for downtown Burbank.

Suycott, like most of Burbank, had been looking forward to next month, when Disney officials were scheduled to unveil specifics of the plan. Suycott had thought that the $611-million complex would be the “spontaneous nucleus” for Burbank’s future.

Now that dream had died.

“I’m stunned, absolutely stunned,” Suycott said. “This concept was ideal for the Burbank area. Naturally, Burbank will survive, but it’s a huge disappointment.”

City and real estate officials, businessmen and residents were still reeling Saturday from the news that Disney is withdrawing its plans, and some were insisting that Burbank would have to lower its expectations for the site.

Many real estate agents and property owners had predicted that property values would rise throughout the city when the project was complete. Some property owners, hoping that their land values would triple, were holding onto their investments. City officials felt that the revolutionary center would permanently erase the city’s image as a dull bedroom community.

In spite of the Disney pullout, some remained optimistic about the fate of the 40-acre downtown redevelopment site where the project was to have been located.

Joe Terranova, president of the Burbank Board of Realtors, said: “We’re sorry to see that Disney couldn’t make a go out of it, but, on the other hand, we believe it’s such a prime area and a prime piece of property that the city won’t have any problems obtaining proposals. The main thing is to get good retail for the city.”

However, 15 years of disappointment and the failure of Disney and at least two other companies to develop the site have left doubts in others about the location. Some said the bad luck that has shadowed the site may continue if Burbank does not lower its expections for development there.

“The future of the property is still strong, but Burbank has to come to grips with what they can do with that property,” said Larry Kosmont, a former Burbank Community Development director who now runs his own development and consulting firm. He said the city should stop wishing for extravagant projects and go for practical development that will serve the community.

Before Disney, Ernest Hahn Inc. unsuccessfully tried for 12 years to build a $158-million Towncenter shopping mall that would have rivaled the nearby Glendale Galleria. That project fell apart when two of the four anchor department stores dropped out of the deal. Shopping industry analysts doubted that the Towncenter would have prospered because of the tremendous success of the Galleria and nearby San Fernando Valley malls.

“A Galleria-type project didn’t work, and, as far as a retail project for that site, the city has got to look at a far more conventional shopping center,” Kosmont said. He said the city should consider a project that would include discount stereo or department stores combined with theaters or restaurants.

“It’s time for the city to get realistic about the real estate market,” Kosmont said. “It will be a different downtown Burbank than was envisioned 15 years ago. Burbank will have to understand what the real estate market is, and they will have to change their vision for downtown Burbank.”

Mayor Michael R. Hastings agreed. “It was pipe dreaming to think that Disney could pull something like this off when Hahn couldn’t,” he said.

Tony Pann, executive vice president of Beitler & Associates, based in Sherman Oaks, said Disney officials “did their best to build something unique. That just wasn’t the right site. They should put a high-quality promotional center there that will serve the community.”

The site is bordered by Magnolia and Burbank boulevards, 3rd Street and the Golden State Freeway. Real estate officials said its size and its proximity to the freeway make it an attractive parcel.

Disney had planned to use the site to build the first of many nationwide Disney urban centers. The proposal included an artificial lake, the “Burbank Ocean,” atop a 6-story parking structure, a fantasy theme hotel and an adventure ride depicting famous movie scenes.

International retailers, it was hoped, would be attracted to a mall at the center.

But, when Disney officials began working out specifics of the complex, the cost more than doubled from the $300 million quoted at first. Michael D. Eisner, Disney’s chairman and chief executive, said certain aspects, such as inconvenient freeway access and competition from the Galleria, lowered the financial viability of the project.

Eisner said Friday that spending $611 million on a project “that wouldn’t work out could trash a company.”

Seth Dudley, a corporate vice president of Studley Inc. real estate, said the project “just got too big. I think a regional mall would have made it. Burbank has good enough demographics and disposable income that, if they put together a bunch of 600-square-foot stores that offered variety and fun, people would come to it.”

For many Burbankers, disappointment over Disney’s failure to build the project will overshadow hope, at least for a while.

“Maybe they should put a real Burbank ocean on this land and be done with it,” said Margaret Tobin, who lives near the proposed site with her husband, Vincent. “Nothing else there has worked.”