George Cullen said he never would have believed it if anyone had said two years ago that he'd be living and working at the intersection of 16th and U streets NW.

The Washington native is vice president of real estate operations for New England Construction Co., which recently renovated the Balfour Apartments at 2000 16th St. NW. Cullen resides in the building, and New England Construction Co. is moving its offices there from Georgetown.

Sales and construction activity recently have increased in what had been a neighborhood of wholesale businesses, vacant row houses and storefront churches.

Several renovations in addition to the Balfour are underway or have been completed within a few blocks in any direction from the 16th and U intersection.

They include the Haddon Apartments and a dry cleaning establishment in the 1900 block of New Hampshire Avenue, a town house at 1919 16th St. that is being divided into investor-owned apartments, a three-story office building in the same block and three new restaurants in the 1600 block of U Street.

Most of the buildings had been vacant for a number of years, and their rebirth seems to signal a change in the neighborhood that once was shunned because of its proximity to the 14th Street corridor. Now numerous sale or lease signs are posted on buildings throughout the area, indicating a turnaround in attitudes toward the neighborhood.

Cullen said New England Construction was attracted to the area by "the overlapping" of the Dupont Circle and Adams-Morgan neighborhoods; its location along a major commuter route, 16th Street; and its proximity to the downtown business district.

In addition, Cullen said he thinks the District of Columbia municipal center now nearing completion two blocks east at the intersection of 14th and U streets is "a positive development" in the neighborhood. He said support from Mayor Marion Barry, the presence of D.C. government offices, increased traffic flow, and active community groups and civic associations are combining to force undesirable elements such as drug traffickers and prostitutes out of the area.

Only a handful of the 53 units at the Balfour are still available, acording to Cullen. They rent from $625 a month for one-bedroom apartments to $975 for two-bedroom, two-bath units.

Claudia Coonrod, project manager for the Haddon Apartments at 1930 New Hampshire Ave. NW, said the 16th and U area has experienced "a resurgence in the past six or eight months and has really blossomed."

She said officials at Corneal Management Co., which manages the Haddon, are pleased with the reaction from potential tenants. "We had a fabulous response from people," she said. "In the first few weeks, we had 100 to 150 people a week coming through the building."

Coonrod said 75 percent of the building has been rented, at prices ranging from $575 for a one-bedroom unit to $975 for a top-floor, two-bedroom, two-bath apartment. Now officials at Corneal are planning several other projects in the same geographic area.

The Haddon has not been renovated as a traditional rental building, but is being held as a rental for five years so the owner, Hampshire Investment Partnership, can take advantage of tax credits for historic preservation. Coonrod said the building will be offered for sale to the tenants or another owner in five years.

The Haddon and the Balfour were vacant for several years before their renovations, and the additional commerical and residential refurbishing in the area near the 16th and U intersection and the opening of several retail businesses signals a change in the neighborhood.

A three-story office building at the southeastern corner of 16th and U that is the former headquarters of Pride Inc. and that has been vacant for two years is being renovated for sale or lease. Sally Widmayer, a sales and leasing representative for Mark Vogel Associates, said the area is zoned "for nonprofit organizations, embassies and associations."

The building, which has 15,000 square feet of space -- 5,000 on each floor -- is for sale for $2.2 million or for annual lease at about $18 per square foot.

In addition to residential development, the number of restaurants and retail businesses in the neighborhood is growing. Cullen said the Balfour's tenants, whom he describes as "young professionals in their 30s," are supporting the local businesses.

Emilio Lopez, manager of Torremolinos Restaurant at 1624 U St., agreed. His restaurant moved to U Street eight months ago from P Street near Dupont Circle.

Lopez said business was slow at first, but "it is now on an upswing." He attributes the recent increase in trade to the residential renovation in the area.

"Once the municipal center is fully occupied in a few months and other offices move into the area, we expect our lunch business will increase," he added.

Ben Hiatt, owner of Julio's Rooftop Pizza, which opened in September at 1604 U St. NW, said it has received "an outstanding reception" from local residents.

"People see the area is being redeveloped, there's a high population density and the community has welcomed us with open arms," he said. "We've spent money on renovating the building and training people, and they can see we are a well-managed business."