Thirty years ago, there was a permanent fire burning in an old oil drum on the corner of Washington and Spring streets, a stone’s throw from the Hudson River in Lower Manhattan. Longshoremen fueled the fire with wood slats they brought from the docks as they made their way to the local bar for a drink.

The bar — the Ear Inn — is still standing, housed in the James Brown House, erected in 1817.

The fire has gone out. In its place is a gleaming 11-story condominium tower called the Urban Glass House, the last building designed by the architect Philip Johnson before he died last year. Eighty percent of the apartments have sold, and the remainder are on the market for between $2 million and $4 million. Recently, the building received its certificate of occupancy, and residents soon will be moving in.

For the owner of the building that houses the Ear Inn, Rip Hayman, the neighborhood’s evolution is nothing less than astonishing. As a student at Columbia University in 1973, he rented a room upstairs from the bar in a “pay-by-the-hour house” with no light, heat, or water for about $25 a month. Until the wee hours, longshoremen and merchant sailors drank downstairs in the bar, known then only as “the green door.”

“It was an elderly and fossilized crowd, by drinking mainly,” he said. “If you came in and they didn’t know you, they stared at you until you left.”

His neighbors included a spice factory and a garbage-hauling company that served the Fulton Fish Market.

“It was pungent,” Mr. Hayman said while drinking a pint of cider. “There were very few residents. It was a wilderness. A dying tale of the marine industry in Manhattan.”

Now, people are buying up “million-dollar shoeboxes” next door.

“It’s a whole new neighborhood. A big tide of concrete and Pradas,” Mr. Hayman said. “Lots of poodles and house plants.”

In 2003, the city rezoned the blocks around the Ear Inn, located west of Hudson Street and north of Canal Street, to permit residential development in an area that for centuries was dominated by manufacturing. The result was the complete transformation of a largely anonymous neighborhood, and a spate of luxury condominium towers rising like weeds in a corner of Manhattan that has housed few residents since the Holland Tunnel was built there in the 1920s.

A biotech company, ImClone, has leased space across the street from the Ear Inn for its corporate headquarters. Within a three-block radius, at least half a dozen new residential projects are rising. Donald Trump is planning to build a 45-story hotel about three blocks to the east. A large parking lot across the street with river views, owned by the Port Authority, is a prime target for development in the years ahead.

Mr. Hayman was part of a group that acquired the James Brown House in the late 1970s. The group restored the bar, and it became a colorful hangout for a mix of artists, musicians, and locals. Mr. Hayman ran an indie publishing house upstairs. The building was one of the earliest designations of the city’s Landmarks Commission, in 1969. Later on, to avoid the red tape associated with installing a new sign on a landmarked building, Mr. Hayman and his friends painted part of the neon “Bar” sign to make it read “Ear.”

Mr. Hayman said the Ear Inn has always welcomed all kinds of customers, but he admits: “Part of me misses the old garbage companies and the rats.”

In the mid-1980s, Susan La Rosa was a regular customer while studying for a master’s degree at New York University. She said she was a big fan of the “chicken cream cognac” and the regular poetry readings. She earned a grant at the time to study the history of the building.

“It was kind of a hip scene,” Ms. La Rosa said on a recent visit. “Nobody lived down here. Nobody was even around here. It was a total pit.”

“All of New York was more bohemian back then. It was a land of more possibilities and undiscovered places. You could disappear,” she said.

Pointing out the low, sagging beadboard ceilings and a display of dusty bottles excavated from below the building, she said the bar retained its gritty charm despite the surrounding development.

“It links the old neighborhood with the new,” Ms. La Rosa said.

On a Friday night, she said the Ear Inn was more crowded than she had ever seen it, although the crowd, she said, was a little bit more upscale.

The Ear Inn now serves high-end pub fare, with $8 burgers, filet of sole, mussels in white wine sauce, and smoked trout. It is still a “cell phone free zone.” A sign in the window reads: “Due to gentrification, the Ear Inn now allows poodles.”

At lunchtime, the bar is bustling with office workers from the surrounding neighborhood, which is popular with creative industries. The afternoon is slow, with regulars flipping through newspapers and a handful of savvy tourists having made the discovery. In the evening, a young, stylish crowd arrives for happy hour and dinner. It is a favorite stop for motorcycle tours of New York. Manhattan’s district attorney, Robert Morgenthau, is an occasional visitor.

“He has found a place that makes him feel young,” Mr. Hayman said of the 87-year-old DA.

For the last year and a half, scaffolding masked the Ear Inn as the apartments rose to the west and renovations were made to the former tenement building to the east. Over that span, Mr. Hayman said business “limped along at half-trade. It has survived, but under duress.”

In 2002, he sold air rights to Antonio Vendome, a local restaurateur, who then sold the adjacent land he controlled to the developers of the Urban Glass House. In exchange, the developers have paid for hundreds of thousands of dollars of repairs and improvements to the Ear Inn, including a backyard fire escape. The building is one of the few remaining wooden structures in the city.

“This house will permanently be safer because of their development,” Mr. Hayman said.

Youthful and charismatic in his mid-50s, Mr. Hayman left a few years ago, and now lives in Rockland County with his family.

“When plaster crashed down on my bed, I knew it was time to move on,” he said.