Property: Day the developers met their match

In the Eighties, Bow Quarter was conceived as a fun place for young people. Now, the recession over, these loft-dwellers are thriving again.

THIS VILLAGE shop has the usual staples plus a special range of food and videos designed to appeal to the locals. Gnat's piss wine. Tarragon and lime mayonnaise. Own-brand hand-made fudge. I blush to tell you the names of the videos, but Sheldon does San Francisco would capture their essence.

The village which this particular shop caters for is Bow Quarter, the residential conversion on the site of the Bryant & May matchstick factory in Bow, east London.

The original factory buildings occupy a portion of the seven-acre site, and a few years ago Ballymore built an additional 170 flats on adjacent land within the estate, providing a total of 700 flats, in seven blocks, and 18 town houses.

In July the shop invited all residents to a champagne reception to celebrate its sixth birthday. Bow Quarter itself is 10 years old, a mixed community which has managed to survive several near-death experiences.

In the late Eighties, the developer Kentish Homes had a great idea: bring New York-style loft and factory living to London in a historically and architecturally distinct building in an affordable part of town. However, following the recession, Kentish Homes went belly up with debts of more than pounds 20m.

In came the receivers, mostly in the form of KPMG's Roger Oldfield. "When I arrived, Bow Quarter was a building site, and about 100 people had exchanged contracts. They wanted out, and they claimed that the brochure had deceived them. But the brochure didn't contain architectural drawings. They hadn't bought off-plan. They bought off an artist's lifestyle drawings."

The brochure depicted an outdoor swimming- pool and an ice rink, but Oldfield notes that this was artistic licence, not elements of a contract.

"Rumours spread that we were going to put a prison and a hospital on the grounds," says Oldfield. "The tenants formed the Bow Quarter Action Group and, to avoid having to complete, they fought to [make] the project fail. We produced our own brochure. We upgraded to put in a pool and gym."

The case reached the High Court, which decided in the receiver's favour. The flats were built in one section of the factory, and under a new developer, London Buildings, the remaining flats were constructed and sold.

Three show-flats in three distinct styles were created, including Andrew Logan's upside-down ceiling sculpture of a naked couple frolicking on Astroturf. Marketing of the Bow Quarter was similarly inventive. The marketing guru George Kozlowski's London Underground advertising campaign included more nudity and a promise of subsidised mortgages.

The Astroturf gimmick attracted press attention, and the allure of free money promised by the Tube cards hooked the architect Martin Crowley: "I got nearly ten grand in subsidy," he recalls. "I was nearly 60, but I was a first- time buyer." For Crowley, the subsidy made the difference between buying and just looking.

The basic residential unit in the Bryant & May buildings is long, narrow and tall. The architect Oliver Richards, who had been with the project for a short time at the beginning and was brought back in by London Buildings, designed the remaining flats to be open-plan, spread across two and three units.

Martin Crowley's flat is on the top floor and, like all fifth-floor flats, is triple height, with a balcony. "It is a real community," he says. "It is secure, and we live according to rules. Although I had six years of negative equity, I've been here ever since, and I'm going out feet first."

Some residents live, love and leave. Roger Black is a former architect and project manager who worked on as well as lived in Bow Quarter for five years. "Our apartment was designed for young people. It had a young atmosphere about it. It became tiresome. It was also a bit far out of town for us. We are now in Bloomsbury."

Mr Kozlowski similarly notes the youthfulness of the place: "Properties are not expensive. You are not just paying for a roof over your head; part of the attraction is its almost college campus atmosphere. Bow Quarter is great for people who are young, single and eager. If you are looking for a place that hooches, this is it."

A one-bedroom flat with balcony and car space sells for pounds 80,000, and two bedrooms command closer to pounds 135,000. Many tenants are renters.

Bow Quarter has a swimming-pool and a fitness centre, a bar, a 24-hour controlled entry security lodge and communal satellite TV and laundry rooms. The original buildings are listed, including a water tower now containing a five-level flat. The residents collectively own the Bryant & May freehold. A single agent manages the development for both freeholders.

For residents generally, the worst is probably over, Mr Kozlowski surmises: "It was built in fits and starts. I'm pleasantly relieved and flattered it survived. It could have been a major disaster. As it is, it's a major success story.

Bow Quarter Residents Management, Fairfield Road, London E3 2UP (0181- 983 0078)