COBOURG - It was love at first sight for retired developer Kevin Doble.

"Three hundred feet of lakefront, in a residential neighbourhood, two blocks from downtown. A piece of property held in a time capsule," is how he describes the spot he discovered an hour's drive east of Toronto.

Doble drew up a subdivision plan that includes million-dollar-plus condos in a heritage Second Empire style, west of downtown Cobourg. Then he built a house for himself across the street.

Wealthy Americans sailed Lake Ontario from the Port of Rochester and built opulent mansions as summer homes. Belden's 1878 Illustrated Historical Atlas of Durham and Northumberland counties said: "Of late, Cobourg has begun to come somewhat into vogue as a summer resort for tourists and pleasure-seekers generally. The reason for this, apart from the pleasant situation of the town and the delightful drives in its neighbourhood, is to be found in the excellence of its hotel accommodations."

Ships continued to bring tourists and coal to Cobourg's port well into the 20th century, but the town's industrial character began to wane through the 1960s.

When Victoria Hall was declared structurally unsafe in 1970, Cobourg stood at a crossroads. The first thought was to tear it down and build a modern town hall. The preservationists prevailed and their influence grew.

In the late 1980s, the town bought the harbour from the federal government and converted it for pleasure craft. Developer James Hoffman bought some of the old industrial land, cleaned it up and started building modest lakefront condos. The first condos went up, even as the tank farms were being hauled onto barges and shipped to Hamilton.

Conscious of the quality of its architecture, Cobourg began to designate heritage districts, encourage preservation and market its waterfront.

In the early 2000s, Mutual Gain of Toronto proposed 250 condominiums in three low-rise buildings around the harbour. The third phase will be finished by March. Others followed, including the Georgian-style freehold townhouse condo project by Cobourg Marina Properties, Esplanade on the Wharf, where units sold for up to $750,000 each.

A few blocks from the lake, Phoenix Genesis is converting an old school into high-ceilinged residences featuring exposed brick walls at its Mansions on George project.

Phoenix Genesis principal Laurel Clarry says the company also plans a new-build condo project, a block off the main street, to complement a heritage building next door.

And Doble says West Colony Bay will include renovation of the historic Illahee Lodge, which he plans to offer for about $1.5 million, as well as $500,000 to $800,000 townhouses and condos for up to $1.2 million. He says sales so far have been from the immediate Cobourg area, but in the new year he plans to market in Toronto.

In recent years, the town had introduced tax incentives to preserve its main street. Business owners fixed up storefronts. A new-build retail/commercial development was constructed in a style that blended in with the heritage structures that were its neighbours. And developers refurbished old structures, including an abandoned hotel, to make way for new retail space, apartments and condos.

Real estate agent Nathan Copeland says three-quarters of his new clients are from out of town, mostly the GTA, and most are aged 50-plus. They tell him they're drawn by the small-town atmosphere, the beach and adjacent Victoria Park, marina and new hospital, as well as lower real estate prices (new three-bedroom, two-bath bungalows and two-bed condos start at $189,000).

Ene Milner has other attributes to add to the list. Milner, who in 2007 was president of the Cobourg-Port Hope District Real Estate Board, cites the strong downtown retail district and cultural and recreational opportunities: theatres, choral groups, orchestra and the waterfront trail.

Milner agrees it's the 50-plus market that's hottest and adds that many are choosing the town because of its proximity, and ease of highway and VIA Rail links, to Toronto, Ottawa and Montreal.

"Council is very careful in doing controlled growth," she says. "They don't want to see another Whitby."

So Cobourg's modest growth is being fuelled by older, more affluent newcomers. It isn't about to become a town of commuters to Toronto, as long as the GO train stops in Oshawa (with bus connections as far as Newcastle), although for some, the daily VIA service to the city is good enough: Delanty estimates from 200 to 250 people from the town and area take the train to and from Toronto each weekday.

When Mutual Gain's groundbreaking Harbour Walk was announced, local newspapers were full of letters from those objecting to the private development going on key waterfront property. The project became a lightning rod for complaints about the town's perceived loss of character, public access and view of the harbour.

Betty Adams moved to Cobourg from Scarborough 13 years ago and says: "I've been disappointed with what they've done to the waterfront. It's a maze."

As for the waterfront, those with long memories say the new look is better than what had been there in recent decades. Teresa Bowen lived in Cobourg when the harbour was industrial. She moved away and returned four years ago.

"What's there now is better than the coal piles," she says bluntly.