DreamWorks Animation (DWA) announced Tuesday that it plans to create a $3.2 billion cultural and entertainment district in Shanghai, with the help of some powerful Chinese partners. If all goes according to plan, the riverfront complex, called the Dream Center, will one day rival New York City's Broadway theater district, and London's West End, with theaters, performance halls, and more.

Is DreamWorks dreaming a little too big, or can it pull this off? Here, a brief guide:

How big will this entertainment district be?

It will cover six large city blocks, featuring buildings designed by some of the world's leading architects. Along with performance venues, the district will include shops and restaurants, just like on Broadway, along with a Kung Fu Panda-themed entertainment section. To give people a place to stay after they've had their fun, the area will also include several hotels. But that's not all. The district will also be home to the world's largest IMAX movie theater, and Oriental DreamWorks, a new $350 million joint venture studio that DreamWorks Animation is creating with its Chinese partners. The studio plans to employ as many as 2,000 people, and produce one to three films a year.  

Why now? 

DreamWorks, creator of "Shrek," "Kung Fu Panda," and other animated hits, is trying to get an edge on rival entertainment companies looking to tap into China's booming market. At the same time, the Chinese government is encouraging projects in order to bolster the country's film industry, keep the rapidly expanding middle class happy, and put its cultural centers in the same league as rival hubs in the West.

To that end, the new studio's first project will be "Kung Fu Panda 3," which will be produced in China, by DreamWorks and its local partners, and released in 2016. The first two films in the franchise -- about a bumbling Panda turned martial arts hero -- proved popular with audiences in China, and fueled calls for more entertaining, less heavily censored locally produced movies.

How important is the Chinese market to Hollywood?

It gets more important every year. Last year's box office haul in China was $2 billion, a jump of one-third over the year before. That was enough to vault China past Japan as the world's No. 2 movie market. The North American market is still far bigger, at $10.2 billion last year, but it has contracted for two years running, making China's potential a target for several major U.S. studios.

Can DreamWorks pull it off?

DreamWorks Animation CEO Jeffrey Katzenberg sure thinks if there's one place such a project can fly, it's China. "I don't think this project can happen anywhere else in the world," he says. "Land doesn't exist." And DreamWorks Animation had better hope the plan pans out, if DreamWorks on the whole wants to keep up with the competition. Around the same time that the Dream Center is slated for completion, in 2016, a new Disneyland theme park is scheduled to open its gates in Shanghai. Walt Disney Co. (DIS) has already announced its own co-production deal in China -- the third film in its "Iron Man" franchise will be co-produced with Beijing-based DMG Entertainment. Like other studios, it's also adding scenes filmed in China, and elements in other films to appeal to Chinese movie-goers.

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