Burbank Gets First Profits From Mall

Six months after a troubled partnership with developer Alexander Haagen ended, the Burbank Redevelopment Agency received its first profits Friday from a $120.7-million investment in the Media City Center shopping mall: a $3-million check.

“We paid on time, in place and as promised,” Haagen said. “God help us if we didn’t. . . . We have worked hard to create as nice a shopping center as there is in Southern California.”

The Burbank City Council--meeting as heads of the Redevelopment Agency--agreed last year to give up the city’s right to half of the mall’s net profits in return for Haagen’s promise to pay $10 million over the next two years.

Already, the agency is committed to giving at least $698,000 of that money to an earlier, unsuccessful developer of the property, the Hahn Co. of San Diego. Assistant City Manager Steve Helvey said Hahn will be paid in mid-May.

When it opened in 1991, optimistic city officials projected that the Media City Center would generate substantial profit for the city. Instead, it suffered from lower-than-expected occupancy and lost millions of dollars in 1992 and 1993, according to documents Haagen filed with the Securities and Exchange Commission.

Public records show that the city of Burbank keeps more than $1 million a year in sales taxes generated by the mall. But economic projections indicated the Burbank Redevelopment Agency would get no net profits at all in the near future if it stayed in its partnership with Haagen.

Haagen is required to pay the agency another $2 million before next May. His publicly held company, Alexander Haagen Properties Inc., is also required to come up with $5 million by that time.