Business

Hurray for Hollywood

A Canadian company breathes new life into Tinseltown's tawdry core

ANDREW PHILLIPS June 22 1998
Business

Hurray for Hollywood

A Canadian company breathes new life into Tinseltown's tawdry core

ANDREW PHILLIPS June 22 1998

Hurray for Hollywood

A Canadian company breathes new life into Tinseltown's tawdry core

Business

ANDREW PHILLIPS

IN LOS ANGELES

The cement is freshly poured, the photographers are in place and the rent-a-crowd is waiting for the order to cheer. All is ready for The Star. And here he comes, his bulbous black Lincoln Continental gliding to a stop outside the famed Mann’s Chinese Theatre on Hollywood Boulevard. Warren Beatty emerges, all hair and sunglasses. Like 213 movie legends before him, he steps gingerly onto the wet cement and rocks back and forth to leave an imprint of his expensive shoes. Then, he kneels and presses his hands into the damp slab. Across the street, a crowd outfitted with T-shirts promoting his new movie, Bulworth, chants on cue: ‘Warr-en, Warr-en!” A mumbled thank-you, a quick pass along the rope line that holds back the curious, and Warren is gone.

That’s about as glamorous as it gets these days along Hollywood Boulevard. Once in a long while,

“the Chinese,” as it is known locally, holds a handand-foot ceremony or hosts a movie première and the beautiful people drop by the old neighborhood. But for the other 360-odd days of the year, Hollywood is a distinctly depressing experience. The nine million tourists who come to the area every year find nothing much to keep them there. They quickly discover that Hollywood the place, as distinct from Hollywood the myth-making machine, offers little more than down-at-the-heels souvenir shops, tattoo parlors and such dubious delights as the legendary lingerie palace Frederick’s of Hollywood,

whose window display promises a peek at underwear worn by Madonna, Marilyn Monroe and—bizarrely—Robert Redford. No wonder the tourists stay an average of just 20 minutes.

That may be about to change, and in large part because of decisions made in Canada. The development arm of TrizecHahn Corp., the Bay Street powerhouse that many consider to be North America’s most aggressive commercial real estate company, starts work next month on a project designed to reverse decades of decline in Los Angeles’s most storied neighborhood. Dubbed Hollywood & Highland, after the intersection it abuts, the venture is a $565-million bet on the future of the area. Built around and behind the Chinese Theatre, it will include stores, restaurants, a 600-room hotel and studios for live TV production. The centrepiece will be a theatre that will serve as a permanent home for the annual Oscars ceremony. The design pays conscious homage to Hollywood’s past with a grand arch modelled after the one in D. W. Griffith’s 1916 epic Intolerance. The arch, the planners say, will frame the famous Hollywood sign that snakes across the hills to the north.

The design is, to put it mildly, a bit over the top—with its ornate elephants and grandly named Babylon Court at the centre. But that, says David Malmuth, TrizecHahn’s main executive on the project, is the point. “Hollywood,” he argues, “has always paid tribute to grandiosity and folly.” Malmuth, 43, is a native of Los Angeles whose previous de-

velopment work included helping to bring New York City’s Times Square back from the dead. As a vice-president with the Walt Disney Co., he oversaw theatre renovations on 42nd Street that transformed the notorious sleaze strip into a symbol of the newly wholesome New York. In its own way,

Los Angeles: a turnaround there could do wonders for the city’s image.

Malmuth’s involvement in the area began in 1994 when he took his three young sons to a Christmas show at the ornate old Pantages Theatre. “I was struck by how forlorn the street was,” he recalls. “It seemed like it couldn’t sink any lower. There was only one way to go—up.” In fact, things could get worse. A couple of weeks later, the street literally sank by about 23 cm as workmen bored a tube for a new subway track below the mile-long strip whose sidewalks are embedded with 2,000 brass and terrazzo stars—the celebrated Walk of Fame. It seemed like the final insult after decades of decline. Since the late 1960s, Hollywood Boulevard had been a magnet for street kids, junkies and prostitutes. Developers and politicians talked constantly about reviving the area, but little came of it.

Still, Hollywood is already on a modest upswing. ‘You should have been here five or 10 years ago—we’ve made a lot of progress,” says

Leron Gubler, executive director of the Hollywood Chamber of Commerce. “It’s a B minus, C plus now,” adds Jackie Goldberg, who represents the area on Los Angeles city council. “But it used to be a D minus.” Just how bad is it? An evening stroll is still a dispiriting experience. It begins just beyond the warm glow of lights around the forecourt of the Chinese Theatre, where generations of tourists have matched their hands against the imprints made by such legends as Mary Pickford and Douglas Fairbanks (the first stars to leave their marks in 1927). Souvenir shops push plastic Oscars and jokey bumper stickers (a favorite: “I slept with the President”). Inside a tattoo parlor, a large woman winces as a man with a cigarette dangling from his lips engraves a design just above her left breast. Visitors from Ohio and Japan and Germany clutch their purses tight and scuttle back to their tour buses.

„ Yet crime is half what it was a couple of years ago. Local businesses | formed an improvement district; they hired security guards to patrol Í the street and cleanup crews to keep the litter under control. The econg omy, in Los Angeles as elsewhere, is booming. Real estate is on the upswing, and some old landmarks on Hollywood Boulevard, like Grau§ man’s Egyptian Theatre, the lesser-known cousin of the Chinese, are « being renovated and reopened. Finally, the city’s politicians are coi operating to ease the way for new projects. All that convinced Malmuth 1 that the time is ripe for a major investment: “The stars, as we say here, “ are all aligned.” When Disney declined to go along with the idea, MalI muth persuaded TrizecHahn to support it, and joined the company’s de1 velopment division in 1996 as senior vice-president. “I felt compelled to I continue to work this project,” he says. “For me it’s very personal.”

¿ It will be, if nothing else, big—57,600 square metres of retail and I commercial space covering two city blocks. Aside from stores and t restaurants, Malmuth wants to bring live TV production into the heart I of Hollywood. A bigger achievement will be bringing the Academy 8 Awards ceremony back to Hollywood, where it was first held in 1929 in the old Roosevelt Hotel across the street from the Chinese Theatre. For years, it has migrated around Los Angeles, but Hollywood & Highland will include a theatre with all the trimmings for Oscar nightseating for 3,300 people, a press area for 1,500, and a 2,700-square-metre ballroom. It is due to open for the Oscars in March, 2001, several months after the rest of the development is scheduled to be completed. And it will, says Malmuth, be “the emotional heart of the whole project.”

For all its significance to Los Angeles, though, Hollywood & Highland is a comparatively modest undertaking for TrizecHahn. It is just one of three major retail-entertainment complexes that the company, controlled since 1994 by gold-mining king Peter Munk, now has under way. The others are in Las Vegas, Nev., and Toronto, where it has

Tower. Elsewhere, the company is expanding at breakneck speed. At the end of 1997, its portfolio

for $285 million in Fetmiary, 1997 _ _ included 78 properties in Canada, the United States

and Europe. By last week, the total had reached 114. The company has become one of the fastestgrowing international developers, with real estate assets worth about $8.8 billion.

Many of those assets are so-called marquee properties such as Chicago’s Sears Tower and Place Ville Marie in Montreal. But Munk has insisted if a better opportunity comes along, he will trade away the most impressive building in a moment. Those calculations, it is clear, do not apply to Hollywood & Highland—at least as far as Malmuth is concerned. He wants to help give Los Angeles something it so conspicuously lacks: an emotional core. “I really connect with the desire that people have to go to a place and feel you’ve touched the essence of it,” he says. “I want to create something that meets that desire.” No easy task—especially in a city legendary for scorning its own heritage. □

OF GOLD

Toronto-based TrizecHahn Corp. is quickly expanding its real estate portfolio. Acquisitions over the last two years include:

• Bell Canada office towers in Toronto, Ottawa and Montreal for $768 million in March

• JBG Companies office buildings in Washington area for $803 million in February (60-per-cent stake)

• Sears Tower in Chicago for $157 million in December, 1997

• Toronto’s CN Tower for $111

Hollywood Boulevard is the equivalent location in !!®nJ0 ----------put $26 million into remaking the base of the CN

• Houston’s Allen Center for $335 million in November, 1996

• Half-ownership of the Grace Building and other New York properties