Regeneration game

Large numbers of listed buildings and iconic new architecture are helping to transform Newcastle's fortunes. By Chris Arnot

Newcastle is surprisingly compact, to use a word long favoured by estate agents. The population of the city is only just over 260,000, and all parts of the centre are easily accessible on foot for those fit enough to cope with the steep streets around the Quayside. But whereas "compact" is a euphemism for "small" in agent-ese, this imposing metropolis on the north bank of the Tyne feels like a place of some substance. You sense it the moment that your incoming train rattles over one of seven bridges and the grandeur of the waterfront becomes apparent.

Newcastle is surprisingly compact, to use a word long favoured by estate agents. The population of the city is only just over 260,000, and all parts of the centre are easily accessible on foot for those fit enough to cope with the steep streets around the Quayside. But whereas "compact" is a euphemism for "small" in agent-ese, this imposing metropolis on the north bank of the Tyne feels like a place of some substance. You sense it the moment that your incoming train rattles over one of seven bridges and the grandeur of the waterfront becomes apparent.

Despite the best efforts of politicians and planners in the 1960s and 1970s, the city has maintained enough of its heritage to boast more listed buildings than anywhere in England, outside London and Bath. Even one of the most monstrous 1970s office blocks has been transformed by a developer into 55 Degrees South, "the best-selling, best-renting building in town," according to one agent. Big windows offer stunning views. There are fine views, too, from loft-style apartments in a former warehouse called The Turnbull (below, left). Northern Land Developers have incorporated some unusual features, including steel girders and the orginal Victorian tiles.

The south bank of the Tyne, occupied for many miles by the straggling ribbon development of Gateshead, has recently acquired two iconic buildings of its own. One is The Baltic arts centre, set in a huge former flour mill; the other is The Sage which is designed by Sir Norman Foster to accommodate music of all kinds, and dubbed locally as "the Silver Snail."

Whether iconic buildings can give more than a superficial boost to an area in which economic depression has long been endemic remains to be seen. But at least the south shore has recently seen a surge in residential building. The developer George Wimpey brought in fashion guru Wayne Hemingway to help create Staiths South Bank. A passionate believer that good design should be available to people on limited incomes, Hemingway has been involved in every aspect of these family homes. All but three of the first 150 houses went within hours of going on sale.

The city-living market for affluent single people is more sluggish in Gateshead. Bellway Homes have converted some former railway sheds into two-bedroom loft-style apartments with views over the river at just under £235,000. Further east, a one-bedroom apartment in a new-build block called Baltic Quay could be yours for £149,000. "It's only gone up by £4,000 in two years, but we still can't sell it," says Stephanie Burgon, the branch manager at Sanderson Young on the Newcastle Quayside. "Most buyers in this market would rather be in Newcastle." There's a certain amount of post-code snobbery in this, she admits. "But there are practical reasons. If you have a riverside apartment, the balcony will be south facing on the Newcastle side and north-facing in Gateshead." Such considerations are important at this latitude.

One London-based Geordie apparently paid £327,000 four years ago for a top-floor flat with 1,000 sq ft of roof terrace at St Ann's Quay on the north bank. He uses it only every other week when Newcastle United are at home. "It would be worth more like £395,000 today," Ms Burgon assures me before leading the way to the nearby valley of the Ouseburn, a tributary of the Tyne with steep banks and a semi-rural aspect. We can hear the clip-clop of hooves returning to a riding stable a few minutes jog-trot from the city centre. Nearby, is a pilates studio, an eco centre and a bar in which some of the coolest bands in the North-East cut their teeth. High above it all is Lime Square, a development of three-bed houses, one and two-bed apartments, built around a central courtyard.

Work is not expected to be complete until September, yet the first phase of 80 properties sold off-plan last May. "The developer insisted on keeping 30 back for owner-occupiers," Ms Burgon confides. "Otherwise they would all have gone to investors." Irish investors, in particular, are very keen on Newcastle. Like Dublin, it's a party city. "Mind you, we're trying to play down that image a bit," says Suzanne Goulding of the Newcastle-Gateshead Initiative. "Yes, we still have a lot of stag and hen parties, but there's so much more of everything else to do here."

There's even a burgeoning gay area, called the Pink Triangle. More impressive architecturally, however, is the art deco Central Lofts in what was once a gay nightclub called Rockshots. Not far away from the Pink Triangle is the conservation area of Summerhill Square, a residential quarter ready to challenge the more outlying suburbs of Jesmond and Gosforth for the title of Tynseside's most prestigious address.

Elegant Victorian and Edwardian terraces have been lovingly restored. None more so than 4, Winchester Terrace, owned by an architect who is moving to Nottingham. A brilliant blend of traditional features with modern fittings, with five bedrooms and a study, it's on the market for £695,000. And if you like the furniture, you can have that, too - at a price.

4 Winchester Terrace, £695,000, is for sale through Sandison Young (0191 255 0800).