Victorian Face-Lift In Poughkeepsie, the M. Schwartz Building.

"It reminds me more of what you see in Europe and older countries, where people like the old but have the new," says Wilkinson. 

Since Dia moved in, Beacon has fashioned itself a kind of mecca for artists and art collectors, but it's no longer—and arguably never was—a haven for struggling artists, due to rising housing prices.

"Beacon has not become a Rhinebeck or a Woodstock yet, because it's more of a city—and it's not right next to the Catskills, so it's not a weekend place," Wilkinson explains.

Currently, a New York City filmmaker is renting the penthouse loft at 197-199 Main—looking perhaps for respite, but not too much of a change, from Manhattan's urban lifestyle.

Jon Behrends, a developer originally from Los Angeles who grew up in Manhattan and moved to Poughkeepsie in 1976, is a driving force in Poughkeepsie's urban revitalization. He's renovated buildings on Poughkeepsie's Main Street near the river, opening up the Demitasse Café, a Victorian café and dining room, and creating about 125 apartments throughout the city. His most recent major project, called the 300 Block project or Behrends Court, is a series of nine buildings—most have Victorian and Italian façades and one is Art Deco—and an alleyway that Behrends bought from the city. The project will have 40 luxury apartments with four work/live lofts and nine commercial spaces. Inspired by a trip to Barcelona, where he found that every apartment seemed to have a little balcony, Behrends designed the units at Behrends Court to overlook a European-style, two-story courtyard. Behrends takes advantage of the greenest technology available—installing ground-source heat pumps, photovoltaics, and cork, eucalyptus, and bamboo floors instead of hardwood, which takes years to regrow. With prices ranging from around $875 for studios up to $1,290 for two-bedroom live/work units, Behrends's projects cater to the higher-end rental market.

Behrends praises city life: "You don't have to get into your car and drive for a long while to get to the theater or to go have a cup of coffee. With urban living, everything is right around you and that's what it's all about." And renting: "Plus, if you are an apartment dweller, you don't have to deal with mowing the lawn or raking the leaves. Or selling your house, getting a mortgage, or getting rid of a mortgage, in order to move. You have the ability to be upwardly mobile and to relocate yourself from area to area."

Adding to Poughkeepsie's urban renewal, the M. Schwartz Building on 303 Main Street has become a great labor of love for architect stephen and lisa aronson. Built in 1868, the building was a menswear haberdashery that remained in business right up until the early 1990s. The regal, 18,000-square-foot building was abandoned until the Aronsons bought it in 1999. They restored the elegantly detailed Victorian façade and built a beautiful new 6,000-square-foot storefront with eight-and-a-half-foot high mahogany doors.

Upstairs are eight work/live lofts, two of which have already been leased. Each is different from the next in layout, size, style, and detail. The smallest is 800 square feet and the largest is 2,200 square feet. Feeling more like SoHo than Poughkeepsie, the lofts feature recycled materials wherever possible, including schoolhouse light fixtures, molding, doors, and floors. Three share the use of a small freight elevator—perfect for artists. One has a delightfully angled exterior wall and pocket doors; another has a private roof garden. All of the lofts have open kitchens with sleek modern appliances and ceilings reaching up to 16 feet. Sunlight pours into each unit through industrial skylights and windows original to the building.

Developers have been skeptical about Poughkeepsie's upscale housing market, but Behrends's projects, which fill up quickly, give proof to the phrase "build it and they will come."

Upwardly mobile professionals, artists, retirees, and hard-core urbanites are flocking to the cities up and down the Hudson Valley—choosing to live where everything is within walking distance, the scale is human, and where breathtaking vistas and trailheads into nature are only a stone's toss away.