Universal Universal Studios' back lot is rising from the ashes — literally.

The studio on Thursday will unveil its refurbished New York street movie sets that burned down in a fire nearly two years ago, which comes as welcome news to the local production community at a time when Los Angeles is struggling to keep movie and TV shoots from leaving the state. After all, New York is L.A.'s biggest rival and is gearing up to expand its film tax credits.

Location managers have long awaited the reopening of the 13-block New York area, the largest of its kind in Hollywood. Spanning a quarter of a mile, the section offers a number of familiar locations from the Big Apple, including a version of the Trump Tower, the Macy's building and Radio City Music Hall. The area also features a rebuilt Courthouse Square made famous in the "Back to the Future" films and a street re-created to resemble 19th-century London.

"It's an invaluable resource," veteran location manager Kristi Frankenheimer said. "I'm glad they rebuilt it."

But even as Universal gives its New York replica a makeover, the studio plans to dismantle or relocate other sets to make way for a residential development that some fear could ultimately make it harder to shoot films and TV shows on-site. And at least one Hollywood scion has reservations.

"They are going to have a community living on top of their production space, which is really a problem," said Roy P. Disney. The son of late Walt Disney Co. executive Roy E. Disney and grandnephew of studio patriarch Walt Disney is an area resident and president of a consortium representing local homeowner groups and neighborhood councils.

As part of a 20-year master plan for its 391-acre property, General Electric Co.-owned NBC Universal intends to sell about a quarter of its parcel for a residential and commercial community that would include 2,937 condos, apartments, a 35-acre park, shops and restaurants.

The community, which would have shuttles ferrying workers to the Universal Studios theme park and City Walk destinations, would be on a mostly undeveloped area on the east side of the property off the 101 Freeway and include parts of the studio's back lot. City and county officials are conducting an environmental and public review of the plans.

To accommodate the project, Universal would have to make some significant changes to its back lot configuration, including relocating Colonial Street and the fictional Wisteria Lane where ABC's "Desperate Housewives" currently shoots and the iconic house and Bates Motel depicted in the classic Hitchcock thriller "Psycho." The house has traditionally been a popular draw of the Universal tram tour.

Also affected is a portion of European Street that will be moved and reused for more contemporary sets. And the Falls Lake site, which director Steven Spielberg used to film "War of the Worlds," will be discontinued because there is no longer a need for the massive outdoor lake with the advent of green screen visual effects technology.