STEVENSVILLE, MD. -- At Grollman's, the 60-year-old general store in this Eastern Shore hamlet, owner Julius Grollman worked the cash register and chatted with customers about the newest baby in town or the latest development in local politics. It became a sort of city hall.

Then in the 1950s, the Chesapeake Bay Bridge was built, Rte. 50 came soon after and there went many of Grollman's customers. Several businesses left Stevensville, the Kent Island town that once was a frequent stopover for travelers from the north heading for Eastern Shore vacations or outings.

With the advent of Rte. 50, most travelers bypassed the town and used the gas stations, convenience stores, restaurants and other shops built along the new highway. Over the years, this town of several hundred people became not much more than a collection of crumbling century-old buildings.

But the rapid growth of housing, retail and office space in Anne Arundel and Howard counties across the Chesapeake Bay has sparked a renewal of Stevensville, which last year was designated an historic district by the National Trust for Historic Preservation.

By purchasing several dilapidated buildings and vacant pieces of land, one local developer, Roger Eisinger, president of Eisinger Kilbane & Associates, is playing a key role in the renovation. He is working with David Prossner, a local real estate broker, who is helping him lease office space in town. Eisinger is working with the local historical society and Queen Anne's County officials to renovate houses, build new office space and homes and attract new businesses to the town.

"I never want it to become a great big town like Bethesda or Rockville has," said Eisinger, 67, whose Bethesda-based firm has worked on development and renovation projects in the Washington area and in Philadelphia. "I want it to remain a small, walking town. I don't want it to be like the strip shopping centers on Rte. 50."

Using much of his own savings and bank loans, Eisinger has started construction that, when completed within the next five years, will include 20 new apartments renting for $450 to $575 a month, a 15,000-square-foot office building and 28 town houses.

Henry A. Berliner, president of the Second National Federal Savings Bank in Annapolis and chairman of the Pennsylvania Avenue Development Corp. in Washington, has helped finance several of Eisinger's projects, including the office building in Stevensville.

"They've been making predictions about Kent Island for the past 10 years," he said. "We were skeptical about it, too, until we started seeing traffic counts increase and the state of Maryland began several major road renovations."

Berliner said the rebirth of Stevensville will serve the three primary types of people moving to the area: the person attracted by the area's proximity to the beach and marinas; those who want to live in a quiet, small town setting and commute to work in Annapolis, Washington or Baltimore; and retirees, many of whom are moving from more land-locked areas to be close to the water. "For us, it's a perfect combination of working with a developer we have confidence in and it's a growing area," Berlinger said.

But growth in Stevensville will be controlled by two key factors.

For one thing, there isn't enough land in the town or remaining on the island to accommodate the kind of large tract housing and office development that is occurring in parts of Howard and Anne Arundel counties.

The other factor is a Maryland "critical areas" law, which limits house construction along the waterfront to one house per 20 acres, a measure designed to preserve the Chesapeake Bay by reducing the amount of waste discharged into the bay. The need for additional water and sewer lines will also slow down any major residential, retail and commercial development, local officials said.

Realizing that there are constraints to growth in the area, Eisinger said he wants to be able to provide the housing for many of the Stevensville residents who want to operate their own businesses in town, and he hopes to provide apartments and homes for the area's newcomers.

Eisinger said his job has not been as easy as he had expected and has proved to be much more expensive then he thought it would be. However, he declined to say how much he has spent in acquiring nearly 20 acres of land in town and in renovating buildings he has already begun.

Many of the buildings are in such disrepair that he has, in some cases, jacked up houses up to pour new concrete foundations, installed new wiring and plumbing and rebuilt porches. In downtown Stevensville, an area no larger than 10 blocks, Eisinger plans to replace most of the existing concrete sidewalks with red brick. He has also preserved 100-year-old trees.

Longtime residents said they are pleased with the changes, but hope the town won't lose its quaint, intimate character.

"When I was little, {Stevensville} was pretty thriving, then it sort of died down," said Debbie Clark, who owns and operates Flowers by Clarke with her husband, Spencer. "But everybody around here likes the changes. Nothing is being knocked down. They're adding to and putting more charm in the town."

Julius Grollman's son, Marc, 29, who now runs the family's general store, said the renovation and new construction is good for the area, but will inevitably change the town. Grollman's, located in an old dry-goods shop, is a dimly lit, wood-floored store that sells a variety of goods, including hunting gear, work gloves and wine and liquor.

"It was a town that was only so big," said Grollman, whose family has lived in Stevensville since the late 1890s. "Everybody knew everybody and there were only three or four stores in town. But soon there will be 10 to 15 new stores and all those apartments and new people here."

Encouraged by the changes in Stevensville and the area's growth, Kelly Gavin Bray, 27, and Lisa Duke, 28, started publishing The Kent Islander Magazine last March with "a couple hundred dollars, an answering machine and some business cards."

Along with ads and feature stories about local businesses, the free, pocket-sized bimonthly magazine has a calender of events, a dining and marine guide and tide tables. The magazine has been able to attract ads from more than 90 percent of the businesses in the area, and it has grown from 120 pages in its first issue in March to 192 pages in its September/October issue.

"When I first came to Stevensville {three years ago}, it was like a town without a town," said Bray, the publisher and editor of the magazine, whose circulation has reached 8,000. "There were lots of stores boarded up and maybe only one or two places open. Now, it's an entrepreneur's dream. There are a lot of young couples moving to town."

Bill Digges, 23, and his wife, Anne, 21, who opened the renovated Country Store last May, hope to maintain low prices and a home-style atmosphere in their restaurant, deli and store despite the growth in the town. Now, the Diggeses sell 25-cent cups of coffee, over-stuffed sandwiches for under $2, ice cream cones and a variety of nuts, herbs, teas and spices.

"What's happening here is beneficial for everybody involved as long as they keep the yards and some of the big open spaces," said Bill Digges, who has lived in Stevensville since 1984. "It's going to bring more business in town, but also there'll be more services for the people here."