Disney ‘Campus’ Plan Boosts Valley as Entertainment Epicenter

With more than bragging rights at stake, a plan by the Walt Disney Co. to develop a 125-acre “creative campus” in an aging industrial park in Glendale further cements the San Fernando Valley’s claim as the capital of the entertainment industry.

Anchored by the DreamWorks SKG animation studio on the east and Universal Studios on the west--with Walt Disney, Warner Bros. and NBC in between--the Ventura Freeway corridor in the East Valley has an unmatched concentration of entertainment industry production facilities and offices.

“This is a pretty impressive roster,” said Jack Kyser, chief economist of the Economic Development Corp. of Los Angeles County. “This shows the Valley is the flagship.”

Disney announced Wednesday that it would convert the 113-acre Grand Central Business Center to an industry center with dozens of new buildings, sound stages and a high-tech business center. Including the new offices for Disney-owned KABC-TV Channel 7 adjoining the site and other parcels, the project would total 125 acres.

The proposed expansion, which must be approved by the Glendale City Council, should attract not only excitement but also spinoff firms to the region, according to business leaders and government officials.

“Disney already is the largest employer in the Valley, and has, over the last couple of years, signified their intent to increase their presence and employment in the Valley,” said Bill Allen, president of the Economic Alliance of the San Fernando Valley, which capitalizes on the region’s entertainment connections in its marketing campaign.

“I think this further reinforces this whole emerging image of the San Fernando Valley as the valley of the stars. . . . It’s a very strong vote of confidence for doing business in the San Fernando Valley,” Allen said.

Disney executives said the company will build the campus on the former site of the Grand Central Air Terminal, the first major airport for the Los Angeles area. Disney has based its Imagineering division at the site since 1961 and now has 3,000 workers scattered in the center’s low-rise commercial buildings.

The project, which at this phase is more concept than concrete, was praised even by neighboring officials in Los Angeles and Burbank.

“When a company like Disney invests in a project of that magnitude in the region, it’s good for the region,” said Rocky Delgadillo, Los Angeles deputy mayor for economic development. “We think this is a positive signal, not just for the San Fernando Valley, but for the entire Los Angeles region.”

Burbank City Manager Robert R. “Bud” Ovrom added: “The development at Disney and Warner Bros. has been a tremendous boost for our economy. Now it’s expanding into Glendale and that’s beneficial for both of us.”

The only note of caution came from some real estate experts, who said the time frame for the project--it won’t be open for occupancy until 2004, with a build-out of up to 15 years--means people should not expect an immediate payoff. “We’re four years away from [occupancy],” said Patrick Church, a broker with CB Richard Ellis who tracks real estate trends in the tri-city area that includes Burbank, Glendale and Pasadena. “Between now and then, a lot could happen.”

In the meantime, civic boosters and others have begun to calculate the downstream ripples of the planned expansion--the most tangible being the increased wealth that probably will flow into the region.

The Valley Economic Alliance estimates that the Valley already is home to more than 60,000 jobs directly related to the region’s major studios and entertainment companies. That does not count the back-shop workers who do everything from set design to costumes.

“Hollywood doesn’t have anywhere near that number,” Allen said. “We have four times as much economic impact, as measured by payroll and vendor expenditures.”

And he noted that the industry is known for its high-paying jobs, meaning a potential business increase for area retailers and restaurants.

Real estate experts noted that industry workers, from producers to grips, tend to live close to work because of their long hours. That could translate into a boost in residential real estate values in the southeast Valley, already one of the strongest sub-markets in the Valley.

Barry Greene of Century 21- Greene Realty in North Hollywood called the Disney development good news for the Valley’s improving real estate market.

“Residential real estate values have gone up tremendously in the past six months,” said Greene. “Properties surrounding the Disney complex will increase in value again.”

J. Allen Radford, the Santa Monica-based developer who is looking to build his own entertainment campus of offices and sound stages in North Hollywood, said he wasn’t worried about the competition from Disney.

And John Borganski, vice president of Pac Ten Partners, which is still seeking tenants for its Glendale Plaza tower, said Disney’s move only reinforces his faith in the area.