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Once the home of John Barrymore, Eddie Cantor and Fanny Brice, 42nd Street began to decline with the Crash of 1929, which bankrupted a number of the theater owners, turning legitimate stages into burlesque houses and movie theaters. Even in Giuliani's youth questionable entertainments were a staple (the future mayor could have paid to see a man eat live mice at Hubert's Museum and Flea Circus). The postwar exodus of the city's middle class continued the block's slow skid into porndom.
It's a neat irony, then, that the crash of 1987 is in great part responsible for 42nd Street's rebirth as a middle-class destination. Earlier in the decade the city and state agreed on an ambitious $2.5 billion redevelopment plan for 42nd Street and Times Square, the driving force of which was to be four mammoth, nearly identical office towers designed by Philip Johnson and John Burgee as a kind of chilly Rockefeller Center South. Fortunately for fans of Times Square's higgledy-piggledy aesthetic, the late-'80s economic downturn pulled the rug out from under that plan. And there was this added benefit: the developers were obligated to cough up $241 million to the city and state whether or not they ever built. That kitty allowed planners to start condemning properties and evicting what they saw as undesirable tenants. Developers still have the right to erect their office towers--ground has already been broken on a building that will house the Conde Nast magazine empire--but the Johnson-Burgee designs have been chucked.
By 1993 most of the old theaters and porn shops were boarded up. Despite a building boom in the rest of the Times Square area, 42nd Street's caretakers were having a hard time interesting new tenants because a figurative stench still lingered. Of the few serious inquiries about the old theaters, one came from a mud-wrestling entrepreneur, another from Michael Eisner. Disney's chairman became interested in owning a theater in New York because the company's theatrical version of Beauty and the Beast was imminent on Broadway. As it happens, the architect Robert A.M. Stern, who had devised post-Johnson-Burgee guidelines for 42nd Street, is a member of Disney's board. Stern told Eisner about the New Amsterdam. On a grim winter day, Stern and Cora Cahan took Eisner, his wife and son on a tour of the theater, shuttered since 1983.
The group stumbled into a magnificent wreck. Water poured through a hole in the roof, mushrooms grew on the floor. "The theater was almost impassable," Stern recalls. "Plaster was all over the stairs, like an alpine slag heap. We each carried giant flashlights and wore hard hats. Birds were flying through, dropping their stuff as we passed. It was a mess, but of course a very romantic mess. Michael was quick to see not only the romance but the potential." What Eisner also came to see, after two years of tough negotiations, was a deal that included low-interest loans from the city and state to cover 75% of the restoration--a good deal for both sides, since Disney's involvement proved to be 42nd Street's turning point, encouraging other corporations to sign up.