Hard hit by the flood of 2002, the Karlín neighborhood is bouncing back, with derelict factories and warehouses being converted for modern business uses. It's also developing into a burgeoning area for contemporary visual art, boosted by the recent arrival of Karlín Studios.

Created from a hulking, disused factory building across from Karlín Hall — the site of this summer's Prague Biennale 2 — the complex houses artists' studios and operates its own public gallery, along with two private galleries: Entrance and the newly reopened Galerie Behémót.

The space's co-founder, property developer Alberto Di Stefano, explains that the project came about when a longstanding complex of artists' studios on Wenceslas Square was sold last year, a move that was inevitable considering its prime location. Well-known Czech artist Jiří David was one of the many who lost his studio in the sale, and he approached Di Stefano to help him find new premises. Together they found and renovated a former factory of the Praga automobile company, then invited a hand-picked group of artists to rent spaces within it.

"The artists were selected according to rigorous conditions of quality and artistic engagement," says DiStefano. "Being a nonprofit, noncommercial operation, we were clearly not interested in simply renting out the spaces but in maintaining a quality profile and supporting the arts community. The synergy of so many creative minds working and exhibiting under the same roof will certainly attract a wider audience of curators, critics and the general public."

In an unusual arrangement, artists will have the opportunity to pay for their studio spaces with art rather than money. In this way artists can be guaranteed sales of their work and at the same time have superior studios without having to pay enormous sums, while the building's owner will kick-start his own private collection of contemporary art — for his Baroque castle in north Bohemia.

The two-story industrial building, with huge expanses of floor space and plenty of natural light, stands alone on an empty lot tucked against the side of Vítkov Hill. It has undergone a simple but stylish renovation, described by Di Stefano as "according to a basic, no-nonsense plan," focusing on the essentials: space division, heating, lighting and toilets. It looks good. With smart white walls and unexpected strips of reinforced glass, rough wooden floors, and industrial metal railings and staircases, it makes for a bare and elegantly functional space.

The list of occupants is varied, from long-established figures on the Czech scene such as David and Tomáš Lahoda to promising recent graduates like painter Daniel Pitín.

"Some names we hoped for are not there," says Di Stefano. "But we are happy to have a strong list of Czech artists." Futura Gallery has also rented a space within the complex for hosting residencies in Prague for international artists. And the Academy of Art, Architecture and Design (UMPRUM) is expected to take a space for its students. "We hope that this mix of generations and nationalities will bring interesting results." Di Stefano says.

For the building's inauguration this summer, the private spaces were open to the public for a three-day exhibition in which each artist displayed a single work in his or her studio. The show made for an intriguing wander, giving visitors a chance to explore the strikingly different spaces inhabited by individual artists. They run the gamut from large, light and airy spaces, to private, shared or even partially open studios of sculptors or painters, and small dens used for multimedia experiments.

Now that the artists have moved in and begun work, the studios may be visited by appointment. There are plans for Karlín Studios to hold an open-door day twice a year, "to bring ordinary people closer to these normally off-limits spaces," says Di Stefano.

The main public gallery space, to be used for changing public exhibitions, will emphasize the artists working within the studio complex, although currently showing (through Oct. 5) is the exhibition "Industrial Traces," focusing on recent conversions of industrial architecture in the Czech Republic.