Landmark Burbank Restaurant Burns : Fire: Arson is suspected in the early morning blaze that caused about $1.2 million in damage to The Castaway.

A Tuesday morning fire burned down The Castaway restaurant, a Burbank landmark with a breathtaking view from atop the Verdugo Hills, prompting an arson investigation.

Authorities were alerted to the fire shortly after 3:17 a.m. when an infrared, heat-sensing burglar alarm went off inside the restaurant, nestled on the grounds of the De Bell Municipal Golf Course, Burbank Fire Capt. Steve Patterson said.

“Some things are suspicious about this fire,” he said.

Firefighters arrived about 15 minutes later to a well-involved blaze that gutted the dining area and left just a wooden skeleton of the kitchen. A ballroom attached to the restaurant suffered water and smoke damage. Another ballroom next to the restaurant escaped damage.

At a meeting of the Burbank City Council on Tuesday night, City Manager Robert Ovrom said damage to the restaurant--which is owned by the city--is estimated at $1.2 million. He said the city plans to rebuild, which could take up to a year, but the building was covered by $5.5 million in insurance.

Under terms of a 50-year lease, the city received $220,000 per year from the restaurant operation, Ovrom said.

“This has a terrible impact on us as a company, but it also has an impact on the people who have come here for their proms and weddings,” said John Rader, divisional manager of Specialty Restaurants Corp., which operated the Castaway. “It’s just a very, very special spot for a lot of people.

“When you see something like this, you’re devastated,” he said, pointing to the wreckage.

Arson officials employed the help of Blanche, a Labrador retriever trained to detect 18 types of incendiary liquids, who led investigators to a paint-type can buried in the wreckage, Patterson said. Unusual burn patterns were discovered nearby, he added.

Fire Marshal Darryl Forbes said several factors made the fire suspicious, noting the timing of the alarm, the advanced stage of the blaze when firefighters arrived and the horizontal direction that the flames burned, indicating that they may have followed an incendiary liquid.

Patterson said insufficient water pressure made fighting the blaze difficult, but did not heavily handicap the efforts of about 70 firefighters and two water-dropping helicopters that extinguished the flames in 90 minutes. The restaurant, located on Harvard Road, also lacked automatic fire sprinklers, Forbes said.

No injuries were reported.

As news of the fire spread, about a dozen employees arrived to solemnly watch fire crews clean up the wreckage.

“The Castaway was the best restaurant in town,” said Debi Dodge, a cocktail waitress and one of more than 200 people left out of work. “Now it’s nothing. . . . It’s horrible.”

Rader said his company will try to help customers who had booked weddings and other banquet engagements at The Castaway to relocate their events to one of his company’s other 11 restaurants throughout Southern California.

Theodore X. Garcia, vice president of the Burbank Historical Society, described the restaurant as a “sentimental” landmark, which was still several years short of the 50 needed to be deemed of historic interest.

“It was historical in the memories that all the people had of all the functions held at The Castaway,” Garcia said. “Everybody I know has had a graduation ceremony or wedding or something up there.”

Times correspondent Ed Bond contributed to this story.