Vienna is legendary for its Old World charm. Long a vigorous center of culture and commerce, Austria’s capital remains desirable due to its location as well as its abundance of music and art. Yet, with all its aristocracy and intrigue (think The Third Man), rich history (it’s 5,000 years old) and exquisite architecture, Vienna has lacked modernity. As we head toward the end of the first decade of the new millennium, however, change is in the air and the city of the Hapsburgs is becoming “new” once again.

Under the Hapsburgs, whose rule lasted for some 600 years, Vienna became the capital of the Austro- Hungarian empire. During the 16th and 17th centuries the Turks tried — to no avail — to capture prized Vienna. But, as the story goes, they did leave their famous coffee behind.

With invasions finally behind it, Vienna began to lay the foundation for what became its famous Baroque charm. Emperor Franz Joseph I was responsible for demolishing the early medieval fortifications and building the magnificent Ringstrasse, changing the physical character of the city forever. The Hapsburg Empire ended after World War I when Austria was reduced to its present size. Sadly, many of Vienna’s architectural treasures were heavily damaged during World War II. Austria became free and independent again in 1955.

Visitors today will witness a wave of renovations in the Old City that is returning Vienna to its centuries-old role as a stylish, happening place. Set along the not-so-blue Danube, with a population of 1.6 million living in 32 districts, the city is reemerging as an enticing blend of Old World charm and modern excitement. Still a center of commerce and responsible for 25 percent of Austria’s gross domestic product, Vienna is a perfect destination for combining business with pleasure.

Though small geographically, Austria is strategically located in the center of Europe and offers interesting export and investment opportunities. Its well-developed market economy and high standard of living — combined with economic reforms and strong ties to the surrounding region — add to its attractiveness.

Electronics, biotechnology, banking, services and tourism are among the most important industries. More than 350 U.S. firms do business in Austria, with many serving as regional headquarters for Central Europe, Eastern Europe and Balkan countries. Austria — Vienna in particular — faces growing competition from neighboring nations, many of which are now E.U. members, but, at the same time, continues to profit from its ties to these emerging economies. Growing at about 3 percent annually, Austria trades primarily with Germany, Italy and the United States. With the E.U. extending eastward, Vienna is expected to become even more important as a business center, attracting more foreign investors. Yes, this once ultra-conservative city is letting go — with new developments, inviting hotels and exciting restaurants.

LODGING

PALAIS COBURG RESIDENZ

Vienna has traditionally transformed stately palaces into hotels. The latest of these conversions is the Palais Coburg, built in the 19th century, opened as a hotel in 2003 and already one of Vienna’s grandest properties. Located near the beautiful Stadtpark, it is the only hotel in Vienna belonging to the prestigious Relais & Chateaux collection. There are 35 suites, a spa and indoor swimming pool. It is also home to the Restaurant Coburg, one of the best new places to dine, and a renowned collection of 1,350 Austrian wines. Non-guests should visit its popular wine bistro.$$$$
PALAIS COBURG RESIDENZ
4 Coburgbastei, tel 43 1 518180
http://relaischateaux.com/coburg

HOTEL IMPERIAL
This famed 19th-century property, now owned by Starwood, was once the home of Philipp of Württemberg. Old World graciousness is everywhere, from the crystal chandeliers to the ornate cei lings and outstanding service. All 128 rooms and suites have been lovingly restored and feature modern amenities. After visiting Vienna’s palaces, this is probably the closest you can come to living in one.$$$$
HOTEL IMPERIAL
Kaerntner Ring 16, tel 43 1 501100
http://www.luxurycollection.com/imperial

DO & CO HOTEL

Opened in 2006, this ultra-sleek hotel in the heart of the city has spectacular views of Vienna’s most famous landmarks and exemplifies the “new Vienna.” The hotel occupies the upper floors of the Haas Haus building — designed by the award-winning Viennese architect, Hans Hollein, who recently returned to create this boutique hotel. There are 45 cone-shaped rooms, including two suites, and the rooms closest to the elevator have the best views of St. Stephen’s Cathedral. Its popular Onyz Bar stays open until 2 a.m.$$$-$$$$
DO & CO HOTEL
Stephansplatz, 12, tel 43 1 24188
http://www.doco.com

DINING

STEIRERECK IM STADTPARK

Considered to be one of Austria’s finest restaurants, Steirereck is now located in a beautiful park setting. The creative Austrian cuisine of Chef Heinz Reitbauer, Jr. utilizes his own home-grown produce. A basement café, Steirereck Meirerei (it means dairy), specializes in cheese and serves small dishes and pastries — making it a great place for breakfast. Lunch at Steirereck is reasonably priced.$$$$
STEIRERECK IM STADTPARK
Am Heumarkt 2, tel 43 1 7133168
http://www.relaischateaux.com/steirereck

PLACHUTTA

Many local fans refer to Plachutta as an institution. It draws everyone from locals to celebrities, who come here for the famed tafelspitz, a melt-in-your-mouth boiled beef specialty served all over Vienna — but at Plachutta, it’s legendary. Ardent carnivores will revel in choosing cuts of beef based on a diagram of a cow. Be sure to reserve in advance for an experience not to be missed.$$$
PLACHUTTA
Wollzeile 38, tel 43 1 5121577
http://www.plachutta.at

JULIUS MEINL AM GRABEN

Centrally located on Vienna’s best shopping street, this stylish dining room is above the famed high-end gourmet food shop. A young, talented chef prepares delicious game along with modern Austrian dishes.$$$
JULIUS MEINL AM GRABEN
Graben 19, tel 43 1 5323334
http://www.meinlamgraben.at

DIVERSIONS

Vienna offers endless diversions no matter the preference. The past is everywhere, yet the present is equally compelling. Walking, especially along the narrow cobbled streets and grand squares, is the best way to discover Vienna’s past. Begin along the pedestrian Kärntnerstrasse to St. Stephen’s Cathedral, a Gothic masterpiece that rises in the center of the Old City.

Stellar museums from many centuries abound, the most famous being the Kunsthiroisches Museum (Maria Theresien- Platz, tel 43 1 525240, http://www.khm.at) built in the 19th century for the Imperial art collection. The old masters from the Liechtenstein family collection — hidden away for 70 years — have returned to the family’s palace, now the Liechtenstein Museum (Fürstengasse 1, tel 43 1 3195 7670, http://www.liechtensteinmuseum.at).

To experience the new Vienna, head to the Museumsquartier (Museumsplatz 1, tel 43 1 820600, http://www.mqw.at), once the Imperial stables and now a huge modern art complex completed in 2002. MQ, as the locals call it, includes the Leopold Museum, which houses Dr. Rudolf Leopold’s fine collection of Klimts and Schieles; the Museum Moderner Kunst; some of the city’s best contemporary galleries and shops and a hip café/bar, Halle (tel 43 1 5237001), that is jumping until the wee hours. The excellent Museum of Applied Arts (MAK) also attracts young locals to one of the town’s trendiest new dining attractions, Osterreicher im MAK, (Stubenring 5, tel 43 1 7140121, http://www.oesterreicherimmak.at).

Once home to Mozart, Beethoven and Schumann, Vienna remains a city of great music. The Vienna State Opera House(Opernring 2, tel 43 1 51444 2955, http://www.staatsoper.at) is among the world’s finest. When the Russians departed in 1955, after years of occupation, the reopened Opera House performed “Fidelio” as part of an ecstatic celebration. To this day, the opera is considered a special occasion and the Viennese attend in formal attire.

During a spare moment, do as the locals do and experience one of Vienna’s fabled coffee houses, such as Café Landtmann(1, Dr. Karl-Lueger-Ring 4, tel 43 1 241000), a favorite of Freud, or Café Central (Herrengasse 14, tel 43 1 5333763), where you’ll mingle with local artists and intellectuals, who enjoy their favorite brew while reading the newspaper. If you harbor any doubt that the Viennese love to eat, nibble your way through the popular Naschmarkt (food market) at Karlsplatz, a lively tradition that dates back to the 19th century. Among the delicious goodies you’ll find apricot jam that makes a great gift and will prolong lingering memories of your journey.

INFO TO GO

Vienna’s Schwechat Airport (VIE) is located about 15 miles from the city’s center. A taxi ride into the city costs about $75, or you can take the City Airport Train (http://www.cityairporttrain.com) for about $25 roundtrip. The train ride to the city center takes 15 minutes. Vienna has an efficient public transportation network. The same ticket can be used on bus, tram or metro (U-Bahn) lines within the city. A Vienna Pass at a cost of about $30 offers free transportation for 72 hours plus more than 200 discounts at museums, shops, restaurants and cafés. For more information about Vienna, visit http://www.vienna.info

Beyond Schnitzel

The Viennese love to eat well. With a widespread empire surrounding them, Austrian cooks were exposed to a vast range of cuisines. Emperors and wealthy families imported cooks from Italy and France. Paprika arrived from Hungary, Bohemia provided dumplings and sauerkraut and the Turks most likely left spices behind with their coffee. Although the staples for which Vienna is known — sausage, schnitzel and strudel — are in abundance, today this sophisticated city offers an array of classic dishes along with innovative contemporary cooking.