Sunlight drifts down from narrow windows and skitters over wooden floors, skirting the feet of the two priests and off-duty real estate agent who sit in the front pew. Other than their soft whispers of prayer, there's little sound in the blue-and-white Throne of Grace charismatic Episcopal church on Florida Avenue. Across the street and the serene expanse of Rosemary Cemetery, a charming huddle of old Florida bungalows cluster around a brick courtyard and colorful garden, where therapists and yoga teachers minister to clients the Rosemary Court Welllness Center.

Healing is in the air in the once neglected Rosemary District. Spurts of redevelopment that began in the 1990s have turned into a steady flow over the past three years, as demand for walk-to downtown property rises. New investors, long-time business owners and city officials are cleaning the streets and alleys, improving parking and landscaping, constructing new buildings and restoring old ones. In the process, an eclectic business neighborhood of studios, offices, a few shops and a handful of restaurants has come into being, filling the old storefronts with new life and imbuing the quiet streets of Rosemary with trendy cachet.

"It's a classic case of urban redevelopment," says Pat Ball, whose office sits in the once abandoned, AME Church, which was built in 1926. Ball has renovated the church and the Hood Building next door. "The Rosemary District has been fairly popular since about 2000," he says. "We've been experiencing growth in Southwest Florida, and people are looking for an alternative to Main Street and Palm Avenue. This becomes the alternate area."

With Central Avenue as its spine, Rosemary District is bounded by Fruitville Road and 10th Street to the north and south and by Orange Avenue and Route 41 to the east and west. Strolling up Central Avenue from Fruitville Road, you'll pass a four-decade Sarasota stalwart, Blue Line, an office supply and printing store, before hitting the main business area. You'll see a hair salon, fitness studio, a couple of photography studios, antique shops, Sarasota School of Arts and Sciences and offices with apartments above. There are funky little Primitive Arts gallery, the stylish Studio 7 Architecture offices, and Ball's beautiful, spare office on the second floor of the old AME church. Studio 7's Ernest Dreher often grabs a bite to eat at the Brownstone Café next door, a laid-back hangout with green leather booths, a chess set in front of sagging, comfortable sofas, an impressive beer list and local artists' works on the walls.

"It's very informal, very relaxed," says Dreher. "Every day when I'm walking out, I run into somebody I know and chat. It's small-town USA."

"There's a strong sense of place," agrees Dreher's partner, Brad Gaubatz. "It's well suited for mixed use."

Rosemary District is home to both the ritzy Renaissance Towers and the low-income Cohen Way Public Housing; the not-so-distant towers of the Ritz-Carlton are visible from the new Salvation Army complex at Central Avenue and 10th Street. You can get a tattoo, eat barbecue, water the community garden, or meet with high-tech experts at the Start-Up Florida headquarters. Soon you'll be able to walk a few blocks south to Whole Foods Market on Central Avenue and maybe Publix on 10th Street. There are a number of businesses like Bob's Place, a tiny box of a restaurant with eight tables and four bar stools set in a cracked parking lot. Owner Bob Horne has covered the walls in circus memorabilia and plays garrulous host to a collection of neighborhood regulars, including the gang that gathers every morning to do the crossword puzzle. Then there's fashionable Home Resource, whose owners relocated from Southgate Plaza.

"We moved here partly because of the transformation this area is taking, partly because of the proximity to the Renaissance," says Michael Bush, vice president of Home Resource (the firm is the decorator for the public areas and models of phase two of the Renaissance condominium complex). "This is becoming a trendy area, and Home Resource has a reputation for being contemporary and leading edge. As this area develops, I suspect it will develop more retail."

It's the latest incarnation for a district that started out as Overtown, the home of the city's black population. Former Sarasota mayor Carolyn Mason grew up on Eighth and Central Avenue in the 1950s, when the area was home to two grocery stores, a car dealership, a drugstore, and a doctor's office. Though Overtown residents could walk to downtown, there were few restaurants there that were not segregated at the time. Then, Home Resource was a tire dealership where the neighborhood kids roller-skated. "My father drove a cement mixer in a yard at 10th and Central," Mason says. "My mother was a maid, like many of the women then. There were a few school teachers, but for the most part, it was a service-oriented community."

In the 1960s and '70s, opportunity for home ownership led many black families to move immediately north to Newtown. As residents moved out of the Rosemary area, crime took over and the neighborhood decayed. Prostitutes were a common sight on street corners, and Horne recalls drug dealers camping out under a chinaberry tree near the building his office occupied at the time.

That's how Greg Pennix remembers it. His father, Joseph, started A-1 Plumbing in 1960, and other than a brief move to Lime Street in the mid-1990s, the company has always stayed in Rosemary District. Joseph Pennix was a quiet voice behind some of the change: He donated a room for use as a police substation and taught a work-study program for local impoverished people.

Now Greg Pennix is president of the Rosemary District Association, which he says began to target trouble spots in the late 1990s and approached the city demanding landscaping and security improvements. The association's requests dovetailed with the city's downtown master plan; and in December 2002, the city adopted a Rosemary District Neighborhood Action Strategy that included improvements in sidewalks, streets, lighting, preservation of historic properties, increase in home ownership, and reduction in crime and illegal activities.

Many of the improvements are ongoing. The one-room substation that Pennix donated to the city has been replaced by the Roy Curt Smith Resource Center, the Rosemary Substation. The warehouse his family owned is now the Sarasota School of Arts and Sciences, which his son attends. Pennix is cautiously hopeful about the district's future. "We welcome new investors with open arms," he says. "I have a business in the area and don't want to see all our work go down the drain. I don't want to move again, and it feels like home."

One major investor is developer Harvey Vengroff, who bought several parcels here and built both the school and the building opposite, which houses offices downstairs and 1,200-square-foot apartments upstairs. Other developers who had owned property for years have also completed projects over the past few years. Jonathan Sheintal owns Rosemary Court Wellness Center, four historic buildings across from Rosemary Cemetery that house a birthing center, spa, massage therapy and yoga and exercise rooms. Finding such responsible tenants was a relief to Sheintal, who says a previous incarnation as an artists' colony with tenants who abused and even torched the property was a nightmare.

"Everyone says the area is ready to bloom, but it's a slow process," Sheintal says. "I didn't know it was going to take this long."

Many see Ball's completion of the Hood Building and his rehabbing of the AME Church as the catalyst for improving the area.

"The city has been supportive for the last 10 years," says Ball. "Everything came together with the funding and the economy. If the economy doesn't get much worse, this area will continue to prosper. Free enterprise and the normal course of development will help the area to continue to do better."

"There's a 50-year cycle for things," says Pennix. "This happened throughout America. With revitalization, it's going crazy. Couple of years ago, you had a hard time selling something. Now, you can't find something to buy." About two years ago, the previous owners of the Boxing Club building on the corner of Central Avenue and Sixth Street bought the property for $160,000, or roughly $12 a square foot. Recently, says Dan DeVito, commercial manager at Michael Saunders & Company, the same parcel changed hands for $358,000, or $22 a square foot. DeVito fielded between 50 and 100 inquiries about the property, many from artists, gallery owners and designers. He says most were looking for spaces to occupy, not merely to hold until prices rise, a practice that some say held back development for a long time. Although prices are not shooting up at the same rate as downtown south of Fruitville, DeVito says flexible zoning and the district's appeal to the artsy crowd has led to an acceleration in interest and prices. Even parcels zoned ILW (Industrial Light Warehouse) are selling at about $10 a square foot, up from their $3 or $4 purchase price a few years ago, DeVito says.

Although you can now buy expensive furniture or visit your wedding photographer in Rosemary District, panhandlers still approach pedestrians in the middle of the day on Central Avenue, and dealers still sell drugs on street corners. Some business owners say crime levels have diminished (the dealers and prostitutes are, at least, less brazen) but others point out suspected brothels tucked away on side streets. Few people stroll here on weekday nights, partly because not much is open after 5 p.m., and the homeless wander through on weekend mornings on their way to the Salvation Army.

The presence of the new Salvation Army facility on 10th and Central is the subject of much conversation among the business owners here. Salvation Army commanding officer Major Bert Tanner says his organization plans to be a good neighbor, and points out the facility's campus-like appearance and the ample seating in the shade beside the facility, which he says will deter homeless people from loitering on the street. But some business owners, such as Sheintal, worry about the large numbers who flock to the soup kitchen there. At this stage in the area's redevelopment, Sheintal says, the ratio of homeless people to the regular residents, shoppers and business people is skewed. He's hopeful, however, that more development will take care of that, and that once the initial shock wears off, developers will not be deterred from investing in the community.

"The homeless, that's just the way it is," says Bryan O'Carroll, owner of Blue Line. "I don't appreciate when panhandlers bother my customers, but it's part of any city."

Carroll says that he no longer has to employ someone to clear out the homeless people from the alleys around his business. Now, says Carroll, at least from 9 a.m. to 5 p.m., the place is safe enough to walk around.

"It's definitely a rawer kind of community," agrees writer Christine Hawes. "But I've never felt unsafe here. I wanted to be somewhere everything isn't new, where things are happening naturally."

Residents like Hawes are important because their presence after hours is what turns a district into a neighborhood. New residents are slowly trickling in, including Kacia Zuill, who works for Take Stock in Children and lives in one of the new apartments that Harvey Vengroff built. She says she and her husband chose the place for its proximity to downtown and their jobs, and because Zuill, who grew up here, liked the improvements she saw taking shape. But though she sometimes bikes around downtown, she doesn't feel entirely safe walking around the neighborhood, even during the day, because of the vagrants she sees.

"They'll have to do a lot of clean-up to draw people down here," says Zuill.

But as developers hope to attract new residents, their developments could end up driving out many long-time Rosemary residents, say some observers.

"I could not afford to live in Rosemary District today, and that is a very sad thing because working people are being priced out," says Carolyn Mason. "You hear about affordable housing-I say, affordable to whom? There needs to be more income-sensitive housing. Today, while we see wonderful progress being made, there is no community there [in Rosemary District]. There's a business community, and they work, and go home at night. It's a sad cost of progress."

Pennix agrees. "We're outpricing the starving artists," he says. "But we want there to be a mix in our culture. I'm afraid we've lost some of that to higher rents and buyouts."He would like to see more residents attend the city-led Neighborhood Action Strategy meetings and express their needs. Though he doesn't live here, he says it's in the interest of all the business owners and city's master plan to keep the residents here and ultimately create a thriving environment for everyone.

"There's definitely a momentum," says Hawes. "There's so much here that can be worked with, so much for the residents to find. People drive by Rosemary Cemetary and take it for granted-it's one of the neatest pieces of history in the county! This neighborhood is packed with historical treasures. It deserves to be spruced up and shown off. Over the next five years, this could be a really cool place to live."