Once a rough-and-tumble industrial centre, Squamish is becoming a haven for young Vancouverites seeking active outdoor lifestyles.

Like many Vancouverites, developer Lorne Segal spent most of his life driving up the winding and picturesque Sea to Sky Highway to the Whistler ski resort without even turning his head at the midway town of Squamish.

But two years ago, he went to look at a commercial property there and was surprised at what he found. Squamish was moving away from its logging roots and becoming an active-lifestyle bedroom community.

Mr. Segal decided the town was ripe for development. He is now building Red Point, a residential waterfront condominium that sold out its initial offering of 118 units in a few hours. "Experience the weekend every day of the week," is the Red Point slogan.

Among young people in Vancouver who are becoming increasingly frustrated by the high cost of living and pricey real estate, there's a lot of buzz about Squamish and its potential for outdoor activities such as mountain biking, windsurfing and rock climbing. And with the coming of the 2010 Olympic Games, Squamish, once a rough-and-tumble industrial town, is in the midst of a transformation unlike anything in its history.

Along the waterfront, once the site of polluting sawmills, there are now luxury residential developments looking out onto Howe Sound, where windsurfers flock to clean, sheltered waters. There are five hotels in the works, a waterfront pedestrian walkway and talk of a marina. The past year has seen the opening of martini bars, yoga studios and quaint cafés, alongside retailers such as Wal-Mart and Home Depot. It's a town running to keep up with itself.

In September, Quest University, Canada's first private university, is set to open its doors to 160 students. President David Strangway, former president of the University of British Columbia and the University of Toronto, says he chose to put the university in Squamish for three reasons: "location, location, location."

"This is a fantastic place to live," says Dr. Strangway, who himself has lived in Squamish since 2004. "This [Quest's campus] will become a small university town housing up to 600 students. That will just put an extra spin on what the town has to offer."

But some residents question how development will affect the town. Already, some developers have damaged greenways and there's a leaky condo in downtown Squamish. Local residents routinely discuss the impact of lower-wage service and tourism jobs replacing high-wage union jobs and the rising cost of real estate. The average sale price of single family home is now $424,000, up from $214,000 in 2000, according to real estate research firm Landcor Data Corp.

Day-to-day life has already changed in town. For years, Dan McRae opened his quaint and funky restaurant, Brackendale Bistro, for breakfast and lunch, but closed down for the day after the lunch crowd left. Last winter, in response to the influx of younger residents, he decided to open at night. He now does a bustling nighttime business, complete with DJs and live music.

The 31-year-old restaurateur moved to Squamish in 2000 from Victoria after visiting friends who were living there. "I love it here," he said. "I love mountain biking and skiing. I know all my neighbours. A farmer down the road supplies us with our lettuce. And yet I can easily get out of town to Vancouver or Whistler."

Like Mr. McRae, Perry Beckham moved to Squamish for its proximity to outdoor adventure. An avid rock climber, Mr. Beckham, now 49, was 20 at the time and Squamish was still a polluted and bustling logging town known in the area as the armpit of Howe Sound. But Mr. Beckham was a logger and he recalls Squamish, at that time, was an easy place to find work.

In the eighties, with the closing of the first pulp mill, the town began to resemble a lot of other resource-based towns across Canada. But there was one difference: Squamish had a stunning wilderness setting and because of that, some of the most valuable pieces of undeveloped real estate in North America.

Mr. Beckham was able to reinvent himself in tandem with the town. In the eighties, he stopped logging and started his own climbing-guide business. Then, he got into the film business, and he now is a special effects and stunts rigger for big Hollywood films such as Snakes on a Plane.

Now, with the coming of the Olympics, the town is going through yet another transition. The world, as they say, will be at its doorstep next year. The nearby Callaghan Valley will house the Nordic Centre, an Olympic venue now under construction, and in January, 2008, there will be five major Olympic test events in snowboarding and skiing and five more in 2009.

"The town is facing an enormous amount of pressure," Mr. Beckham says. "We're in the midst of a major identity crisis and it's overwhelming for the town. But it's an exciting place to live."