High Hopes for High-Tech CityWalk : Retail: In its first two weeks, MCA’s shopping and entertainment complex has been a hit. Experts believe the big crowds will continue.

MCA Inc.’s Universal CityWalk definitely isn’t your typical shopping mall. A visitor can have his fortune told, sip drinks on a fake beach, eye an Andy Warhol artwork and buy an environmentally themed gift next to an exhibit of a rain forest.

But will it make money?

Based on the traffic since the $100-million retail and entertainment development opened two weeks ago atop the hill at Universal City, many think MCA’s chances of success are quite high.

Retail specialists heap praise on the media concern’s high-tech facsimile of city streets with glitzy, neon storefronts and such offbeat retailers as Things From Another World and Think Big, plus restaurants from Wolfgang Puck, Gladstone’s and Venice Beach cult favorite Jody Maroni’s Sausage Kingdom.

“For that project I don’t see any risks,” said Deborah Simon, senior vice president at Melvin Simon & Associates, an Indianapolis shopping center developer that is a partner in two other splashy retail projects--the Forum Shops at Caesars Palace in Las Vegas and the giant Mall of America near Minneapolis.

“It’s something I would have done if I had the land,” Simon said.

Lawrence D. Spungin, president of MCA Development Co., said that CityWalk is perfectly situated to get foot traffic from tourists coming off the Universal Studios tour. The tour, which is next to CityWalk, has about 4.5 million visitors a year.

CityWalk also siphons customers from the busy Cineplex Odeon Theaters located at the other end of the shopping promenade, and from the Universal Amphitheater, where a revival of “Jesus Christ Superstar” just closed. The two venues attract a combined 2.5 million ticket buyers a year.

But Spungin said he has been pleasantly surprised at the throngs of people who have come just to see CityWalk. MCA originally estimated that CityWalk would attract an additional 1 million visitors annually, apart from those who go there before or after one of the other Universal attractions.

“I don’t necessarily want to alter that projection just based on a couple weeks experience,” Spungin said. “But it certainly does seem that if things continue, we’ll exceed that number significantly.”

MCA, a subsidiary of Japanese consumer electronics concern Matsushita Electric Industrial Co., also owns and operates six of CityWalk’s 40 shops and restaurants.

Certainly, CityWalk’s merchants need to generate significant sales to justify MCA’s rents, which at $4 to $7 per square foot monthly are higher than any other retail center in the Valley area.

Even at the upscale Glendale Galleria or Northridge Fashion Center, monthly rents average $2.50 to $5 per square foot, said Michael Lushing, vice president at commercial real estate broker CB Commercial in Sherman Oaks.

But the Forum Shops at Caesars Palace charge rents comparable to CityWalk.

The Roman-themed complex, which opened a year ago, is considered by retail specialists as the most similar to CityWalk in its melding of shops and entertainment. Forum retailers have reported strong sales, and Simon said that demand for space there continues to outstrip the supply.

“As long as they can deliver the bodies, tenants don’t mind paying bigger rents,” Lushing said.

Some see other risks. MCA is counting on CityWalk to attract a large local crowd. Although area residents have turned out in big numbers so far, interest might dry up once the initial fanfare has subsided.

“No one is going to drive there just to buy a dress,” said Elena Butorac, Los Angeles regional director for the Hahn Co., a La Jolla-based shopping mall developer.

Locals might also rebel against the confusing parking arrangements for CityWalk. Parking costs anywhere from nothing to $5, depending on when and where a visitor parks, merchant validations and the length of stay.

As for tourists, the danger is they might gawk more than shop.

A four-foot-tall baby bottle from the Think Big gift shop wouldn’t fit easily under a plane seat. Much of the merchandise is pricey: Current Wave has $60 women’s T-shirts; an overalls-and-shirt set for a toddler at Uniquely Kids is $64. A small yogurt with a dozen berries costs $3.10 at Yo-Gert.

But most observers consider these risks minimal, and CityWalk merchants, who have signed leases for a minimum of five years, uniformly gush over the customer response so far.

“There are more people than we know how to deal with,” said Juli Erickson, director of the Martin Lawrence Museum Shop.

Ivor Sack, owner of the Upstart Crow bookstore and coffeehouse, and Kathy Monkarsh, co-owner of Jody Maroni’s Sausage Kingdom, both say their sales at CityWalk are easily doubling those at their other locations.

“The response is beyond our wildest expectations,” Monkarsh said.

The Memorial Day weekend “was incredible,” said Robert Hanover, executive vice president of Wizardz, a combination nightclub-theater-magic shop. “I think everyone in Los Angeles was here.”

Attendance remained high last weekend, with the wait for dinner at the center’s restaurants on Saturday night averaging more than an hour.

Despite the prices, people are buying at CityWalk, said Robert Shelton, chief executive of Out-Takes, a photography studio at CityWalk that sells pictures of subjects imposed on computer-generated movie and television scenes.

By contrast, Shelton said, at another shopping area he is familiar with, the Third Street Promenade in Santa Monica, “there are not as many people carrying bags. Here people are actually shopping.”

Simon believes that CityWalk’s eclectic mix of merchandise will be its strength.

“Some of the things, you say, ‘Oh come on, people will never buy it.’ But they just walk out the door,” she said. “You’d be surprised what sells.”

CityWalk obviously aims to surprise. The elaborate facades, mostly paid for by the tenants, include simulations of a car and a spaceship crashing through storefronts.

Wizardz has strolling magicians, fortunetellers, laser and magic shows and a bar shaped like Merlin’s hat. The Nature Company store features a rain forest exhibit with a replica of a banyan tree.

In a cross between Disneyland and Venice Beach, street performers have been employed at CityWalk to juggle, sing and otherwise amuse patrons while they browse.

CityWalk also has a few more traditional retailers, such as soap store Crabtree & Evelyn and Island Nut Co. The Museum of Neon Art and a UCLA Extension center with 14 classrooms are located there.

Also, a Sam Goody Musicland store will open soon, and a Steven Spielberg-designed pavilion featuring Panasonic electronic products and a Showscan motion simulation theater are in the works.

So confident is MCA about CityWalk that it is already planning a “CityWalk 2” next to the existing development.

The second project, which is about two years away from groundbreaking, would be about the same size as CityWalk.

MCA is also in the early planning stages for a similar development in Florida, where MCA has another studio tour. The concept for a Florida CityWalk would differ from the Universal City project, which is modeled after Los Angeles, Spungin said.

Until then, he believes, people will keep coming to CityWalk, in part because of its relative safety compared to real Los Angeles streets. CityWalk has a Los Angeles County sheriff’s substation as well as private security guards.

Sure, the sand on CityWalk’s fake beach might be a shade too white. But the real key to CityWalk is simply that it’s different.

Said Spungin: “People seem to be getting bored with just the mall experience.”