Architects and sculptors take the lead in bringing the Basque capital back to life. By John Westbrooke

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Bilbao is where all the great architects go. Tucked away on the northern Spanish coast, the declining industrial city barely existed in travellers’ consciousness 20 years ago. Then the authorities decided to regenerate it.

The result is a collection of dashing new buildings, particularly along the river banks, heading out into what were becoming ever more derelict docklands and industrial areas.

We took a river cruise, and the commentary was a list of Pritzker this, Pritzker that. The Pritzker Prize is an annual international architectural award, effectively the Nobel for architects.

Richard Rogers, 2007? Tick: three housing blocks now going up. Rafael Moneo, 1996: the Deusto University library. Alvaro Siza Vieira, 1992: university halls.

Norman Foster, 1999: the underground system; the curved glass structures, like snail shells, rising out of the ground to cover the escalators down to the stations are called fosteritos. Zaha Hadid, 2004: a master plan for rehabilitating Zorrozaurre, a 60-hectare peninsula in the river accidentally created when construction of a canal stopped halfway.

And there’s more: Santiago Calatrava has built a bridge, César Pelli’s Iberdrola Tower is the tallest building in northern Spain, Philippe Starck has turned an old wine warehouse into the Alhondiga culture centre.

But at the head of the roll call of starchitects is the Canadian-American Frank Gehry. (Pritzker? Of course. 1989.)

It was his design for the Guggenheim Museum, opened in 1997, that turned Bilbao around. It’s called the Bilbao Effect: the way just one spectacular building can suddenly turn the eyes of the world towards you. If you’ve heard of Bilbao now and you hadn’t last century – that’s Gehry. If your local city planners are talking wistfully of commissioning an Iconic Building – that’s Gehry.

Ironically, the museum hadn’t planned on Bilbao at all. They wanted Barcelona, but Barcelona was short of cash after the 1992 Olympics. So the Barcelona Effect is regeneration through sport; the Bilbao Effect is about architecture.

I hadn’t actually expected to like the asymmetrical Guggenheim; photos make it look like an exploded tin can. But what do you know: it’s beautiful.

It lies alongside the river, managing to resemble both something organic and a cruise liner. The “bows” stretch out under a bridge (the bright red arch across the bridge is also an artwork). The tin can appearance is created by titanium panels, an innovation in themselves, above a base of sandstone. Up close they’re as thin as paper and yield to pressure from your hand. From a distance they’re a pinky gold that changes colour as the light moves on their curving walls.

Inside, we found a variety of postwar paintings and sculptures, a couple of visiting exhibitions and a Richard Serra installation filling the long gallery under the bridge. But even if there’s no art you fancy, the stunning building is still worth a visit.

And you don’t need to go inside at all to see some work. Big items, such as Louise Bourgeois’s giant spider Maman, Jeff Koons’s Puppy and Fujiko Nakaya’s Fog Sculpture, which involves pumping mist out over a pool every hour, are outside, and others stud the riverbank and nearby streets – tourist offices have maps for a sculpture walk.

If there’s a downside to all this, it’s that some day every ambitious city in the world will look like Bilbao. The architects are all international, and so is their work. Big cities will all have their own titanium Gehrys and their own Calatrava bridges (many already do), just as British high streets all have Paddy Powers, WH Smiths and Burger Kings.

So it was a pleasure to find old Bilbao on our hotel doorstep. The heart of the original town is still going strong, and wonderfully easy to walk around.

There are some old-style iconic buildings: the baroque Teatro Arriaga; the grand Plaza Nueva; the riverside market hall piled with fresh fruit, veg and fish; the cathedral and the churches. Plenty of other museums too (we enjoyed the Bellas Artes, across the river, and its cafe). The city’s website details them all – respect for architecture is nothing new here.

But most of the Siete Calles area, the seven streets forming the oldest part of town, is notable for the way buildings blend in with one another, not the way they stand out.

Straight, narrow streets are lined by apartment blocks all the same height, about six storeys, their balconies, open or glazed, creating an elegant visual rhythm as you walk along. At ground level are shops selling everything locals could want, from shoes to sausages. The roads are clean and everyone is dressed up. This is how high streets should be.

Bilbao is only just inland, on the Nervión river. At least, it may be the Nervión. In fact, it joins the Ibaizabal river just upstream, and many suspect it’s the Ibaizabal that really provides most of the water and should provide the name too. The town is surrounded by high ground, offering wide views. A lift behind San Nicolás church goes some way up (you can stroll back down the steep cobbled streets), but for the best outlook take the Funicular de Artxanda from Calle Castanos, two blocks east of the river, up into the hills.

The town was founded in 1300 on a conveniently flat area on the shore, but the Basque people had been here long before: there are burial sites going back to 4000BC. The Basques kept Romans, Visigoths and Moors at bay and joined Spain only with a self-government clause.

This is still a live issue. Regional elections in October brought a surge in support for separatist groups, boosted by the ending of 40 years of terrorist action. Separatists see Spain, struggling with the euro, as a millstone, though Bilbao, with its big building programme and a noticeable lack of beggars in its streets, looked relatively prosperous to our tourist eyes.

A Spanish-speaking friend observed that very few people actually speak Basque in the streets – unlike Barcelona, where Catalan is widely used. Perhaps that’s not surprising. Catalan is close to Spanish. Basque is not, and must take forever to learn. It’s the oldest language in Europe and, remarkably, isn’t related to any of the others. Legend once claimed it was the original language spoken in the Tower of Babel.

We saw Bilbao at its best, in the sun. This is Green Spain, and sunshine isn’t a given. Still, if it gets damp, the excellent transport system will get you around. Feel free to linger all day in pintxos (tapas) bars and restaurants, the way the locals do; and you could even visit the gold, glowing Guggenheim down by the river.

Bilbao tourism:
The Guggenheim:

Article and images ©John Westbrooke