DREAMWORKS, GLENDALE DEAL NEARING COMPLETION : STUDIO CONSTRUCTION COULD BEGIN BY FALL.

Byline: Lee Condon Daily News Staff Writer

The city of Glendale's Redevelopment Agency is expected to finalize its deal with DreamWorks SKG on Tuesday, paving the way for the company to build a Mediterranean-style animation studio along the Los Angeles River.

Under the agreement, DreamWorks could begin construction on the first phase of its 500,000-square-foot campus this fall, said Jeanne Armstrong, director of development for the city.

``It's the most significant new business since Nestle/Carnation chose Glendale in 1988,'' Armstrong said.

The development deal essentially wraps up negotiations between the city and DreamWorks. The agreement also must go before the Planning Commission and the City Council, but is not expected to face opposition.

When completed, the studio is expected to create about 1,000 new jobs and spur development in the stagnant San Fernando Corridor along the city's western border.

The city and DreamWorks, founded by entertainment executives Steven Spielberg, Jeffrey Katzenberg and David Geffen, began official negotiations to build the studio on an out-of-the-way, 12-acre plot along the river - known as Crystal Springs - in October.

DreamWorks recently bought the property - just northeast of the interchange of the Golden State Freeway and the Ventura Freeway - from the city of Los Angeles, which used it for many years as a Department of Water and Power storage yard.

The company plans to build a campus with a Mediterranean theme, according to a report by Armstrong that provides the first glimpse of the design plans.

DreamWorks' proposal includes seven structures, each between two and four stories high with pitched tile roofs, terraces and porches. They would incorporate towers up to 150 feet high and be clustered around a central plaza and would be connected by passageways, verandas, courtyards and bridges.

A 1,000-car parking garage and a helipad also are planned.

The anticipated agreement would conclude a deal that was complicated from the beginning.

Initially, the DWP had planned to lease the site to the Glendale Respondent Group, a consortium of area businesses that had been ordered by the federal Environmental Protection Agency to build a water reclamation plant to clean up contaminated ground water in the Burbank-Glendale area.

The GRG already had designed its plant, but Armstrong said city officials were determined to accommodate DreamWorks once the studio executives expressed interest.

`If we have to jump through hoops, fine. That's going to be our style when an organization of DreamWorks' quality comes along,'' said Councilman Larry Zarian. ``We want to make sure we keep them. DreamWorks needs us and we needed DreamWorks.''

The redevelopment agency will pay $2.8 million for redesign and relocation of the GRG plant.

DreamWorks will pay back the $2.8 million, plus $200,000 incurred by the agency through property tax money to be paid over the next 31 years on the studio's estimated assessed value of $75 million.

The agency also may reimburse DreamWorks for its child-care center and a sound wall if tax revenues grow large enough, Armstrong said.

The site is located within the city's San Fernando Redevelopment Zone, which was created in December 1992, and Armstrong said city officials hope it will jump-start the area.

Bill Boyd, senior vice president at CB Commercial, a real estate firm in Glendale, said the studio is necessary to seed the area and predicted other media-related companies will follow.

He also said other downtown Glendale businesses - including insurance and financial companies - may seek lower rents in the San Fernando Corridor.

``When (DreamWorks) was announced it helped add a level of credibility to that part of the market, much like Nestle did for the downtown Brand Corridor,'' Boyd said. ``There is some momentum we can see just based on the calls we're getting from entertainment companies.''

The city has been targeting entertainment companies, trying to capitalize on the success of neighboring Burbank in cultivating media growth.

Besides DreamWorks, Turner Feature Animation and Warner Bros. recently leased space in the city for their animators.

``It is known now that Glendale is the animation center,'' Zarian said.

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Map: DREAMWORKS SKG

DreamWorks plans to start construction in the fall on its Mediterranean-themed animation studio. When complete the 12-acre campus is slated to have seven buildings, a 1,000 car parking garage and helicopter pad, interconnected by arcades, verandas, courtyards and bridges. City officials expect its assesed valued will be $75 million.

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