Before the floods of 2002, Karlín was a crumbly sort of neighbourhood with vast abandoned factory complexes, elegant but battered apartment buildings and broken-up cobbled streets. In spite of this, Karlín never felt like an urban wasteland. Tucked just north of the city centre in Prague 8, the neighbourhood always had a distinct community feel to it, with locals actually hanging out in the streets, kids riding on bikes, dog-walkers stopping to chat.

Much has changed in the last seven years. The factory buildings are still there but most now wear new coats of paint on their repaired facades. And high-end projects such as the Danube House, Amazon Court, River Diamond and Corso Karlín are changing the face of the former working-class neighbourhood. Happily, the community atmosphere remains. Outdoor cafes have livened up the streets and grimy pubs still crouch between shops selling designer furniture.

One of the latest additions to gentrified Karlín is Cornlofts, touted as the Czech Republic’s first loft-living complex (if you overlook the much smaller Nuselský mlýn). Like many new projects in Karlín, it is the work of the developer Real Estate Karlín Group, which aims to transform Prague 8 into a high-end neighbourhood.

The complex was designed by the Austrian architectural firm Baumschlager & Eberle and is housed in the shell of a former 19th century refinery. I say shell because just the northern facade of the building has been preserved. Everything else, the floors, the roof the inside walls have been gutted and replaced with entirely new material. As part of the CZK 400 million reconstruction project, architects Martin Šenberger and Tomáš Šenberger carried out an in-depth study of the former refinery’s history and current condition. Their conclusion was that despite the building’s multifarious roles –it was used as a refinery for only some nine years after construction – the refinery was in good shape and that its interiors could be modified to suit their new loft function without any drastic changes. It seems that the investor wasn’t convinced. Over the last two years, I watched the building’s transformation with a certain distaste and expected little more than a generic luxury apartment complex, wearing a historical mask.

Now that the project is all but finished, I am happy to take my words back. The original northern facade on Šaldova street, repainted a shade of warm beige, retains its connection to Karlín’s traditional streetscape. The southern facade, meanwhile, is made up of large moveable milky glass panels, that sit on the side of the building like the scales of an enormous reptile. Across a narrow courtyard stands another building, an entirely new structure, also covered in the glass panels. The transition from the old to the new is surprisingly seamless. The entire complex looks modern and fresh, without overpowering its historical surroundings.

Inside, the connection to the building’s history is more tenuous and awkward. The preservationists’ demand that windows be kept at their original level on the Šaldova street facade mean that some rooms have relatively small windows at nearly floor level. Also, since the interior has been replaced entirely, the flats (there are duplexes, triplexes and single floor flats) are not lofts in the true sense. The architects have, nonetheless, tried to covey a sense of openness through the use of skylights and bright open spaces on the southern side, where the sliding glass panels cover terraces that run along the length of the building’s whole facade. In the communal areas, only large black and white photographs of the former refinery recall the building’s history – but the stairwells and corridors, perhaps through the use of iron pillars and clean lines, still manage to convey an industrial character. It’s a building of compromises, but the result is surprisingly compelling.