Concrete dust settles in sculptor Richard Martin's steel-gray hair despite the dark blue fishermen's cap he tugs down over his head. After nine years of waiting, he says with an unbroken expression of delight, he can't resist wandering through Old Town Alexandria's soon-to-be-completed Torpedo Factory Art Center.

"Anticipation is building," says the 54-year-old former network television sound technician. "I come over here for no reason at all, except to go look. I smile a lot."

On May 21, the brick-red doors of the newly remodeled Art Center--originally a World War I torpedo plant--on Union Street just south of Cameron, are scheduled to open after extensive remodeling to house the studios, shops and galleries of 200 artists as well as the city's urban archaeology museum and research lab.

There will be much fanfare, but there will also be apprehension on the part of some of its neighbors who think the revamped center on the Potomac River waterfront may open the way to development that would ultimately destroy Old Town's historic character.

Developers and city officials agree that they are counting on the center--transformed from a worn and massive concrete hulk--to be much more than studio space for Martin and his colleagues and a repository for the city's artifacts.

The center, first crammed with art and artists in 1974, is seen as the centerpiece of a much-touted plan to transform a key section of the city's decaying waterfront into a commercial, retail and residential showcase. By June, the Torpedo Factory Office Building, just north of the art center, is expected to open, along with a 462-space parking garage across the street.

And over the next three years city planners envision the 65-year-old wall of dingy industrial buildings that have stood between the heart of Alexandria's commerical district and the river to give way to a complex of shops, office space, houses reflecting Victorian architecture and costing as much as $300,000, restaurants and a marina.

"It will put Alexandria on the map," proclaims George Collyer, the city's chief planner for the project. He says the entire Torpedo Factory complex, which its developers estimate will cost as much as $50 million (mostly in private money), will give tourists a new reason to come to Alexandria and spend their money.

"We won't be a Boston or a Baltimore," Collyer says, referring to the redeveloped waterfronts of those cities. "But we will be something else to see."

Critics of the plan, particularly those who live near the site, are skeptical.

"It's just going to be horrendous as far as parking is concerned," says Lonore Van Swearingen, who lives in a 190-year-old house two blocks from the art center. "What are they going to do with all those people?"

How the city expands its commerical corridors in Old Town while it tries to preserve the area's residential sections is an issue repeatedly raised by opponents of the complex.

But after more than 12 years of planning, it's a must-do project, says council member Donald C. Casey, who maintains that the city must find ways to broaden its tax base.

Some Old Town residents say they feel the ambiance of their quaint antique neighborhoods is being threatened by too much development, to much traffic and too many people.

A new art center should add 100,000 people to the half million who visited the old one last year before renovation, making it the city's greatest tourist attraction, the Alexandria Tourists Council estimates.

Since the inception of the city's waterfront redevelopment in the early '70s, the influential Old Town Civic Association has advocated a plan that calls for more open space at the river's edge instead of the massive commerical use of the factory buildings that line the waterfront.

Some Old Town residents say they are becoming increasingly alarmed at the degree to which their part of the city is coming to resemble traffic-clogged, congested Georgetown.

"Lower King Street is not quite M Street yet, but King with its shops and restaurants, brings a lot of people in Old Town," says Old Town Civic President William Lynch.

"The fears of Old Town becoming a Georgetown certainly aren't going to be allayed by the type of high-intensity development the Torpedo Factory represents."

Nevertheless, the council has endorsed the riverfront complex, which, through a series of complicated financial agreements with private investors under the umbrella of the project developer, the Alexandria Waterfront Restoration Group, is expected to cost the city about $12.5 million. Once anticipated state and other aid is taken into account, the City of Alexandria will be getting a massive waterfront development for a $5 million investment, according to Deputy City Manager Bradford Hammer.

Hammer says projections of the dollar benefits Alexandria would reap from the Torpedo Factory complex aren't available. But he said its financial impact on the city's economy will be far-reaching.

"It will be a sure plus for the metropolitan area," said Vice Mayor James P. Moran Jr. "It will be an on-going city fair."

But there are national critics of the kind of massive redevelopment Alexandria is planning. "It's really a question of building in safeguards," says Frank Gilbert, assistant general counsel for the National Trust for Historic Preservation, who cautions that unless handled carefully, commerical projects in historic districts can spell disaster. "I think it is important to recognize that developers come in with very ambitious plans. The residents have a right to ask searching questions of the city and potential developers and storeowners as to how they are going to conduct business."

He said there weren't enough questions asked in the cases of the Atlanta Underground and Gaslight Square in St. Louis. Both, he said, overly commericialized historic areas and contributed to deterioration of the areas.

That view, however, is not held by Alexandria officials. "I am optimistic," says chief project planner Collyer. "I think there will be a lot of pressure on the city to move" once the art center is open to visitors. "They are going to want to know what's coming next."