Spielberg Notes Hollywood Twist for Dream Works : Entertainment: He, Geffen and welcome guests to studio site--the hangar where Howard Hughes built the Spruce Goose. Mogul dubs it a spot where dreams are brought to life.

Where Howard Hughes once tread, now comes Steven Spielberg and company.

That bit of symbolism was as vivid as a Hollywood sunset Wednesday in the vast aircraft hangar where, half a century ago, Hughes built his fabled Spruce Goose. With that relic now packed off to a museum in Dayton, Ore., and the aerospace industry still reeling like one of Jurassic Park’s ill-fated tyrannosaurs, Spielberg took over the dim, dank and drafty hangar and proclaimed it home to the future of movie-making.

“This was so ideal it was almost meant to be,” Spielberg said during a ceremonial unveiling of the proposed new DreamWorks SKG studio complex at Playa Vista, a high-tech entertainment center expected to break ground in June. “There must be some kind of karmic relevance to the fact that we are here in a hangar that Howard Hughes built to bring his dreams to life.”

So far, the location is several flights of fancy from inspiring awe. There are rutted asphalt lots and drab industrial buildings. The hangar itself is mundane--a cavernous shell of blue corrugated metal containing scratched concrete floors, air ducts encased in silvery insulation and a vaulted ceiling held up by rows of steel beams.

But DreamWorks SKG--the highly touted partnership formed last year by Spielberg, Jeffrey Katzenberg and David Geffen--has big plans for the site. Within three years, DreamWorks expects to invest $200 million in creating a high-tech center bringing fiber optics and state-of-the-art computer technology to filmmaking.

The DreamWorks studios, built around an eight-acre lake, will form the anchor for a $750-million, 100-acre campus of studio facilities. And that complex, in about 10 years, will be part of a small town of more than 1,000 acres that will house 30,000 people and contain, among other things, more than 5 million square feet of office space. The massive project is being developed by Maguire Thomas and the Howard Hughes Corporation on oceanfront land north of Los Angeles International Airport.

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A day after the Los Angeles City Council gave its conceptual approval to the plan, the three moguls took to a makeshift stage on Wednesday, dwarfed by the size of the hangar and, illuminated by portable spotlights, pronounced their faith in the high-tech future of Hollywood.

Joining them were about 600 guests, from TV news crews and reporters to prospective tenants, film agents and political figures.

“It’s the biggest business win that any city has ever had,” Mayor Richard Riordan gushed, before a luncheon that included smoked salmon and pasta salad. “It sends a message to the rest of the world that Los Angeles is back.”

Gov. Pete Wilson was equally effusive, alluding to the DreamWorks triumvirate as the “Three Wise Men” and saying, “To say I’m pleased and proud would be a terrible understatement. I’m excited as hell.”

Wilson made it clear that the entertainment industry represents important hope to a state hard hit by cuts in the aerospace and defense industries.

“In my prior incarnation as a mayor [of San Diego], I would have sold my family to get a project like this. . . . Unlike Howard Hughes’ Spruce Goose, this one’s going to fly and soar for a long time.”

Not every observer was so enthusiastic. About a dozen protesters, standing in a light rain outside the Playa Vista gates, held picket signs saying, “DreamWorks Wake Up,” and “Spielberg Phone Home 2 Stop This Project.”

Marcia Hanscom, representing a group called Citizens United to Save All of Ballona, said more than 25 environmental groups have voiced opposition to the project, including Greenpeace L.A., the UCLA Environmental Coalition and the Rainforest Action Network.

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Those groups are fearful that the development will create substantial additional traffic in an area already badly congested and threaten sensitive wetlands nesting sites, despite a pledge by developers to restore the Ballona Wetlands.

Those concerns seemed far from the minds of those with embossed credentials in the hangar, where a number of prospective tenants wondered more about what the rental rates might be.

George Clooney, star of television’s “ER,” met briefly with Spielberg, having recently made a deal to appear in one of the director’s films. Clooney said it was his day off, and so “I thought I’d come over and see where I’d be coming to work every day.”

Director Jim Cameron, noted for his special effects in “Terminator II,” was there contemplating a new home for his rapidly expanding production company, Digital Domain. The firm, which now leases 80,000 square feet in Venice, is looking to move to a site with 200,000 square feet.

“If we don’t become part of this, we have to create a smaller model [of the center] on our own,” Cameron said. “Why reinvent the wheel?”

But his partner, Scott Ross, noted that no one is sure yet what the lease rates will be.

Guests spent much of the time gazing at miniature scale models, artists’ renderings and exhibits. There was an oversized blow-up of the March 27 Time magazine cover billing the Spielberg-Katzenberg-Geffen partnership as America’s new “media colossus” and two video displays of the October, 1994, press conference announcing the new company.

City Councilwoman Ruth Galanter, who was elected in 1987 during controversies over how best to develop or preserve the Playa Vista site, praised the planning that went into what is being touted as a prototype community.

Much of the established environmental community--including the Friends of Ballona Wetlands and the National Audubon Society--are supporting the project.

“This is the most exciting thing that’s happened as long as I’ve been a City Council member,” Galanter said.

Spielberg, who wore a brown baseball cap and black leather jacket, acknowledged the concern over the coastal habitat--in particular, over the many frogs that now inhabit the site--by noting that E.T., the extra-terrestrial, was frog-like in his appearance.

Not only are filmmakers and sound engineers welcome, Spielberg said, but “I also welcome every frog in Los Angeles to please come to Playa Vista. When the wetlands are complete, you have a home here, too.”