Businesspeople have high hopes for the previously derelict part of provincial capital

Karolina Caban spent Christmas Day in a "village" in downtown Hefei, its narrow alleys bedecked with lanterns and packed with dozens of bars, inns, cafes and other small shops.

Caban described the distinctive neighborhood, known as zhongyinyushi in Chinese, or "Hidden in the City", as a place that "has its own soul".

Yet not many years ago, the area was filled with garbage depots and had no soul at all. The village had been considered a blight on the provincial capital for almost two decades.

"Garbage and polluted water were everywhere," said Xu Lijun, director of the Wuhu Road community in the city's Baohe district, which governs the neighborhood.

The neighborhood, which expats now call "Bar Street" or "Shipyard Street", takes up about 200 meters along Shuguang Road. It was once part of the vast Hanwa village, which was divided into several sections when a number of roads were built in the 1980s. Most of the buildings were demolished and replaced by high-rise buildings, and the area remaining was reserved as backup land for two schools, leaving dozens of shabby dwellings in limbo.

Before 2012, there were more than 20 private garbage and recycling depots, and local officials and residents had appealed to the government to improve the image of the village.

"The depots saw a lot of garbage brought to the village every day, making it a place nobody wanted to go, except garbage buyers and their customers," Xu said. "The schools were still there, so constructing new buildings was not among the options."

Property owners also strongly objected to a proposal, which would have been very costly to the government, to demolish the old residences and build a park. "They understood quite well that land in such a geographically central place was very valuable," Xu said.

"We could also clear the depots out, renovate the houses to rent them to street vendors by ourselves," he said. But officials "were not sure whether such a mode could be sustainable and would fundamentally improve the image of the village".

Authorities "had been wavering for quite a while", Xu said, when a private company, Anhui Zhongyinyushi Business Management, made an attractive renovation proposal.

Zhu Hong, the company's president, said he had dreamed for years of finding "such a place to run a specialized cultural street in the city".

"Such streets are also seen in cities including Beijing, Shanghai and Chengdu, while a place suitable for similar operations was hard to find in Hefei," Zhu said.