It’s 7 a.m. on March 1, 2001. The hustle and bustle of the big city is coming to life. Store and theater owners are getting ready for the rush of thousands of tourists who pour in daily to snap photographs, spend money and experience the scene of this great community.

It could be a snapshot of New York’s Times Square, but it’s actually the scene at Hollywood Boulevard and Highland Avenue. A scene in the future, but the very near future thanks to TrizecHahn’s $400 million investment in a new retail and entertainment center.

Many of us who have lived in Southern California over the years are skeptical. This has been tried before and failed. What can be different today than in years gone by?

It’s worth going back to the 1970s, when Times Square had become a spawning ground for pimps and drug dealers. It provided the appropriately seedy environment for “Taxi Driver” and “Midnight Cowboy” to be shot unfit for visitors, inhabitants and business people.

It took a private/public campaign effort before investors committed $4 billion in the Times Square neighborhood more than enough to bring back the glamour of 42nd Street. Indeed, more than 20 million tourists now stop by Times Square each year. This renaissance has revitalized Broadway’s 39 theaters, with 10.6 million show tickets sold in the 1996-97 season marking a milestone for the largest audience volume on the Great White Way in 16 years.

For non-theatergoers, over 250 restaurants and 10 cinemas boasting 40 new screens beckon. The neighborhood now is home to more than 27,000 residents a population enhanced by nearly 1.5 million commuters who pass through Times Square on a daily basis. Strap-hangers, sightseers, shoppers and strollers make this New York nexus a constantly happening environment.

As for commerce, Times Square is headquarters for about 5,000 businesses and organizations, inhabiting 21 million square feet of office space and employing 213,000 people. The mix reflects the array of disciplines New York attracts from financial services and media to entertainment and fashion.

The impetus for Times Square’s incarnation was ignited around the end of 1994 when Walt Disney Co. agreed to renovate a decaying movie theater on West 42nd Street in the center of the square. Within less than three years, the New Amsterdam Theater reopened with a musical production of Disney’s “The Lion King.” Suddenly, commercial real estate experts and business leaders noted that Times Square worked.

A Business Improvement District helped clean things up first by shutting down sleazy establishments that had reached their peak in the ’70s, when there were about 120 “adult-use” storefronts. By 1994, the number was reduced to 47; by 1997, it was 21.

Sanitation efforts were vastly increased, crews were put to work to remove offensive graffiti, and other campaigns were initiated to sustain the cleanup. Additional efforts included improved street lighting and pedestrian passageways.

David Malmuth, a former Disney development executive who worked on renovating the New Amsterdam Theater, had a similar vision for Hollywood. The experience from 42nd Street gave him the insight to believe that hidden within historic streets and communities lie golden opportunities.

The El Capitan, Pantages, Egyptian, and Mann Chinese theaters have been the conservators of an era when Hollywood was the glamour capital of the world. These great institutions will now be complemented by multimillion-dollar projects including: the $20 million Hollywood Spectacular, the $45 million Hollywood Marketplace, the $3 million Hollywood Museum, the $4 million Entertainment Plaza as well as the $15 million renovation to the Egyptian theater, which will reopen in December. The El Capitan Theatre has already been renovated by Disney and will reopen this month.

The “Bringing Hollywood back to Hollywood” project will include 57,500 square feet of ballroom space; a 3,300-seat live entertainment venue that will be home to the Academy Awards; a five-screen, 1,800-seat multiplex operated by Mann Theatres; Babylon Court, which will feature restaurants, shops, and nightclubs; and the Hollywood Hotel, a new 565-room facility that will reinvent the existing on-site hotel.

When the Hollywood & Highland project is in full operation, it is expected to generate $122.3 million in new on-site spending, which will, in turn, generate $217.6 million in new economic activity in Los Angeles County. The additional sales tax that is expected to be collected annually from new retail spending would be close to $2 million.

With additional taxes collected from business licenses that are based on gross revenues, the city expects to generate about $8.9 million from the Hollywood & Highland development, vs. $1.8 million that had been projected without the project.

Retail spending is estimated to reach $213 million, including new sales in the hotel. The Hollywood & Highland project also will have a positive impact on nearby businesses in the Hollywood community.

This is a classic case study in the power of economic development which, if harnessed properly, can fulfill the dreams of America’s best-known and best-loved historic communities.

From the concrete canyons of New York to the palm-lined boulevards of Los Angeles, two extraordinary locations are being returned to their original incarnations. Times Square has once again taken on its legendary roles as a center for the Big Apple’s entertainment and tourism world; Hollywood will undergo a magical “facelift” and emerge re-chiseled as a magnet for the West Coast’s movie-going, business and community population.

Lorraine Spurge writes the Business Journal’s “Ask Lorraine” column and is the author of “Money Clips: 365 Tips That Will Pay One Day at a Time.”