First, it was Hespeler’s seedy massage parlour.

Now, it’s the place on Queen Street locals call the “biker bar” that Cory de Villiers intends to transform from eyesore to attraction.

“It’s always the lowest denominator that people look at in a downtown – that’s how they judge it all,” he said.

That’s not fair, but it’s reality, he said while standing at his living room window, overlooking the heart of Hespeler that’s endured decades of decline.

“This is such a wonderful little neighbourhood. You feel like you’re in a small town.”

He and his wife Natasa moved from Kitchener to Hespeler in 2007 and bought a three-storey commercial building at Queen and Adam streets.

The building was in tough shape and had a dodgy reputation, since it housed a massage parlour on the upper floors.

They gutted it, refinished it and rented out the main floor to a coffee shop. The rest become their home, complete with restored pine floors, bare interior brick walls and a rooftop balcony out back.

It’s what de Villiers has in mind to bring life back to the grubby Hespeler Hotel just a block down Queen, at Tannery Street. City officials were a big help with converting the property at Queen and Adam and are ready again with advice, grants and loans to help restore the old hotel, de Villiers said.

When the couple bought the heritage stone building from Andre Watteel in February, it housed two commercial units below and nine apartments upstairs. The commercial space will stay, as will three or four overhauled apartments. The rest will convert to rental office space.

Three tenants remain—for now—as the renovations get underway on the second floor. The couple started swinging hammers last month to chisel away concrete parging covering the inside stone walls.

They plan to do as much of the work as they can, when not at their day jobs. He’s a sales manager at RIM and she works at Humber College in Toronto.

The building shell is structurally sound, de Villiers said. Most of the rebuilding will be out back, where a badly sloping second floor must be ripped out and replaced as a cathedral ceiling is installed over the new office space.

On the main floor a tenant will open the Five-Fifteen music bar.

The most visible part of the makeover will likely be out front, where de Villiers plans to rebuild a second-floor balcony overhanging the sidewalk. It’s been gone since the 1940s.

“We’ve really got high expectations of what this can become. We’re interested in the historic restoration.”

A driveway along the east side of the building leads down to an unusual basement. Beside the door to a one-time laundromat, there’s a brick archway big enough to drive a car through. It marks a wide passage under the main floor and around to a rear yard where a stable once stood to house traveller’s horses.

If de Villiers’ dreams unfold as planned, the secluded space beside, under and behind the old hotel will become a restaurant patio. “There’s so much potential for this space.”

Restoration may end up costing $300,000 by the time upwards of 15,000 square feet is rejuvenated over the next few years, de Villiers said.

“A lot of people have told me I’ve bitten off more than I can chew. It’s a massive project.”

He is convinced Hespeler’s renaissance is underway. He sees a few building owners taking the lead to clean up buildings, which encourages others to do the same. There’s also the challenge of bringing the right stores to the area, to serve customers fed up with impersonal big box store shopping, de Villiers said.

West along Queen Street, work is underway to refinish the exterior of Ernie’s Roadhouse. Owner Rob Cox also believes in Hespeler’s core after watching five years of improvement. The restoration job shows his confidence to stay.

“It’s expensive. It’s either we’re staying for the next 25 years or we’ll get out now.”

Kitchener developer Shawky Fahel has city approval to for a $30 million transformation of the old American Standard factory into 140 upscale condominiums and street level stores. Work is expected to start by summer along the Speed River, with people moving in by the end of 2011.

“I think Queen Street can turn into a little St. Jacobs. There’s potential of turning the whole village of Hespeler into a very, very big urban renaissance area,” he said

“Everybody creates a little ripple and it will create an urban renewal wave.”

kswayze@cambridgereporter.com