Too bad the Engels couldn't stick around for a few more weeks. On Nov. 9, TrizecHahn Corp., a publicly traded Canadian real estate company, plans to unveil Hollywood & Highland, a $615 million shopping, theater, and hotel complex that is the centerpiece of a decades-long effort to revitalize one of Los Angeles' most famous neighborhoods. Like a film epic the city itself might have produced, the Hollywood story has it all--movie stars, glamour, a descent into drug addiction, an earthquake, and now, a spectacular comeback. And it ain't over yet.
A chilling cliffhanger scene has just been added. The terrorist attacks have prompted a last minute threat by the Academy of Motion Picture Arts & Sciences to pull its famous awards show, scheduled for Mar. 24, from Hollywood & Highland's crown jewel, the $94 million Kodak Theatre. "I think the first quarter of 2002 will be the big test," says Steven Tronson, a commercial real estate broker in Hollywood who has had deals with three prospective tenants in other buildings fall through since September 11. "If Hollywood & Highland does well, we'll see a surge of interest in the neighborhood. If not, we could see a lot of momentum come to a halt."
Hollywood is a 17-square mile community of 260,000 people parked between downtown Los Angeles and its swanky cousin to the west, Beverly Hills. By 1910, the area's ranches and citrus orchards were becoming the new home of the motion picture industry. In the 1920s and '30s, movie stars and their fans dined at the Brown Derby, shopped at the Broadway department store, and caught the latest flicks at a string of fancy theaters. But like many urban areas, Hollywood began to decline after World War II as returning GI's bought homes in the suburbs. Soon, Hollywood's fine haberdasheries were replaced by pizza joints, T-shirt shops, and pornographic bookstores. The bronze stars that line the Hollywood Walk of Fame were planted in 1960 as a way to revitalize the neighborhood. It didn't work. Transvestite prostitutes and crack addicts became as common a sight as Japanese tourists.
Still, like New York with Times Square, Los Angeles knew it had a huge, underutilized asset in Hollywood. Ten million tourists a year come to check it out. But most spend no more than 20 minutes snapping a picture before getting back on a tour bus.
Redevelopment stalled during the 1991 recession, but in an odd turn of events, the 1994 Northridge earthquake shook loose a pile of federal relief funds. Landlords assessed themselves additional property taxes to pay for private security and sanitation services. A long-delayed and overbudget subway connected Hollywood to downtown. Los Angeles' Community Redevelopment Agency now kicks in $20 million a year. Commingled with private dollars, the city funds spurred development.
Now, more than $1 billion worth of new projects are under way. Among them are an $90 million renovation of the famed Cinerama Dome movie theater and of hundreds of high-end apartments, shops, and offices. Small television and movie production companies have also begun to trickle back into Hollywood from Santa Monica and the San Fernando Valley. Fenton Bailey and Randy Barbato, founders of documentary producer World of Wonder, bought a four-story office building at the corner of Hollywood and Cherokee two years ago. "It's amazing how fast the neighborhood has changed," Barbato says. "A year ago, it was what we called ghetto fabulous. Now, it's Banana Republic cashmere."SCANTILY CLAD. Indeed, Hollywood has become the hottest place in Los Angeles for nightlife. More than two dozen trendy clubs and restaurants have opened in the past year. Perhaps the hottest club in town is Deep, at the corner of Hollywood and Vine. It features two glass cages suspended from the ceiling with scantily clad dancers writhing inside. "There's a strip club and tattoo parlor next door. That really works for me," says Deep owner Ivan Kane. "Hollywood is still edgy, and that's what my customers want."
But not too edgy for Walt Disney Co. Like New York's 42nd Street, Hollywood is also enjoying a shot in the arm from the Mouse House. Disney has been grossing over $1 million a week at the recently remodeled Pantages Theatre on Hollywood Boulevard. That's where a theatrical version of The Lion King plays. Disney also claims to have the nation's top-grossing single-screen movie theater down the street at the El Capitan Theatre, remodeled in 1993.
All eyes now, however, are on Hollywood & Highland, a project that has had plenty of ups and downs of its own. Toronto-based TrizecHahn, one of the largest owners of downtown office space in the U.S., became involved in the mid-1990s. Since then, costs have skyrocketed as the theater was enhanced, a Marriott Renaissance hotel added, and a myriad of minor details thrown in, such as fancy catwalks in the ballroom for lighting and sound. Earlier this year, TrizecHahn announced that it intends to sell its entertainment and retail properties, including Hollywood & Highland, because their returns are relatively low.
Still, Hollywood & Highland will be a major attraction. Inside is a 425,000-square-foot mall with shops like Coach, Louis Vuitton, and Aveda to lure tourists. For now, 90% of the retail space is leased. The "Babylon Court" courtyard, with its view of the Hollywood sign on the hills above, is anchored by two 13,500-pound elephant statues, a salute to Intolerance, the 1916 film by D.W. Griffith that ushered in the concept of extravagant sets. "The building is so over-the-top, it's like a Sylvester Stallone movie," says local architect and University of California at Los Angeles Professor Craig Hodgetts.
A critical part of the project was winning the industry's participation. The Kodak Theatre was designed specifically for the Oscars broadcast. The venue is on the small side: With only 3,600 seats, it's half the size of the current site, the Shrine Auditorium. Eight of the theater's 24 opera boxes will be used for cameras and equipment.
In spite of the extra attention, the Academy held out for more changes in the wake of September 11. The organization even threatened to keep the ceremony at the Shrine next March unless certain requests were met, such as allowing security staff to sweep through all the mall stores on the day of the Oscars. Spokespeople for both sides say the Academy got everything it wanted.
Of course, it's not so much a real attack as the fear of one that Hollywood & Highland's developers must deal with. As in the rest of the country, tourism to Los Angeles has plunged, and with it interest in the project. Kenneth Chu runs the Los Angeles office of the Japan Travel Bureau, that country's largest tour operator. He says his business--more than 120,000 people a year--was down 70% in October. Chu says he will still expand his average tour-bus stop on Hollywood Boulevard from 15 to 50 minutes, but he has shelved plans to open an office on-site.
TrizecHahn is changing some of its plans as well. The theme of the opening- day bash has been switched from "A Return to Glamour" to the more generic "Salute to Hollywood." A ceremonial contingent of soldiers and firemen will be present at the ribbon cutting. The mall's marketing staff has shifted from targeting international customers to local ones. The company is making a big pitch with Amtrak, for example, to get more visitors from San Diego and Orange County. "This will be L.A.'s first true gathering place," says Hollywood & Highland General Manager Russ Joyner hopefully. Maybe this saga will have a happy ending after all. By Christopher Palmeri EDITED BY Edited by Harry Maurer