At the end of April, Vice magazine, the Williamsburg house organ, threw a party in the neighborhood. The party was inside 80 Wythe Street, a giant old factory building, a redbrick behemoth that was built in 1901 as a cooperage. Those bricks used to be covered in graffiti and wheat paste and other street art ephemera from some of the genre’s best practioners. On this occasion, they were gathered inside, to celebrate an installation around the corner by Faile, the local artistic duo known for their psychotropic collages, a mix of comic books, B-movie posters and indigenous art from Asia to Iroquois.

“When we were young artists just getting by, scraping together enough money for that next project, this was the place to be,” said Patrick Miller, one half of Faile. “Williamsburg was it.”

Nearby, two blonde cherubs, the children of Patrick McNeil, Mr. Miller’s artistic partner, spun themselves silly around three stylized Tibetan prayer wheels in the middle of the room. The elder child, a boy of about five wearing the skinniest of black jeans, kiddie Converse and a jean jacket with a giant Tiger patch on the back bigger than the boy’s head head, came to an abrupt stop in his dance. His sister, maybe three, in engineers overalls, a step behind, jumped just then into his arms, and they embraced in a hug. The whole jaded room was watching.

It was the cutest, coolest thing in all of Brooklyn.

A decade, even five years ago, it would have been impossible to imagine this scene. “Look at the lineage here, it’s somebody who cares a lot about making Brooklyn cool,” Mr. Miller said, gesturing around the space.

This was not some swanky, skanky loft party on the edgy edge of New York’s social periphery. This was the unofficial opening party for the Wythe Hotel, the kind of establishment that thinks of itself as above opening parties, above press, above hype, even as a line forms out the door. This is, the work of three Brooklyn tastemakers in their prime.

This was, is and will be the greatest thing Williamsburg has ever seen. It is the pinnacle, the acme, the end. The story of gentrification, at least in this oft-buzzed about corner of Brooklyn, is over—checked at the curved-glass-and-carefully-rusted-steel door outside the Wythe. If Francis Fukuyama needed a hotel room in Brooklyn, this would be it. Thank you, and good night.

Slideshow: Inside the Wythe Hotel >>

“I love this hotel,” Nick Greene said, never mind it was his first visit. “It’s nice there’s finally a hotel in Brooklyn. In my fantasy of my parents’ and my own coolness, they’ll stay here, and I’ll come to the parties here.”

“You can forget about the Ace, the Standard and the Dream,” Peter Shapiro, proprietor of the super-popular Brooklyn Bowl across the street (and a Chelsea resident), said, a smile on his face and dollar signs in his eyes. Or maybe it was just the free cocktails.

A few weeks later, on a quiet weekday afternoon, Andrew Tarlow, one of the masterminds behind the Wythe, was standing at the bar (that he designed) inside Reynards, the restaurant he runs just off the lobby. “We wanted to do something that was right for the neighborhood, a place where likeminded people can congregate, something that would be welcoming not only to the neighborhood but to their families, too.”

Mr. Tarlow is one of the godfathers of that neighborhood, having opened Diner a dozen years ago, on Williamsburg’s South Side. It was at the forefront of farm-to-table, nose-to-tail eating in the borough, certainly for anything outside the brownstone belt. The ethos spread with each new venture: the slightly more upscale but still shambolic Marlow & Sons next door; the butcher shop up the block, Marlow & Daughters, with its carefully sourced provisions lining the walls; the lavish and literary Diner Journal ($9, ad free); and Marlow Goods, where the hides from all those steaks, chops and roasts are turned into leather goods.

“I was really excited about the opportunity to take what we’ve been doing at a two-hour dinner and extending it out into a 24/7 experience,” Mr. Tarlow said.

It is almost too true. Upstairs and throughout, this place is infused with That Brooklyn Spirit, the artisanal, precious, local, exquisiteness that is at once suffocating and intoxicating, but most of all utterly desirable.

Remarkable as the food is, it is de rigueur for Mr. Tarlow and the foodie nation-state he helped created. What really sets the Wythe apart is that building, which really is the nicest thing ever built in Williasmburg. (Not a particularly high bar given that Williamsburg has probably seen the greatest concentration of terrible architecture visited upon the city during the recent real estate boom.)

That is the case thanks in large part to Jed Walentas, the partner in the project without whom it almost certainly could not have been realized.”Jed is a real visionary,” Peter Lawrence, the third partner in the project, said inside a booth of Reynards last week. Together with his father, David, Mr. Walentas almost singlehandedly transformed Dumbo from a grotty warehouse district into the most expensive neighborhood in all of Brooklyn—yes, pricier than the Heights, the Slope or the Burg. It gave him invaluable experience, and resources, to help see the hotel through.

It was in Dumbo that Mr. Walentas met Mr. Lawrence. An Australian expat, Mr. Lawrence’s youth was misspent rather successfully in Melbourne, where he worked in a number of five-star hotels before transitioning into nightclub and party promotion. “You could only do that for so long, and the only way out seemed to be to get out,” Mr. Lawrence said. In 1995, he arrived in New York and shortly thereafter opened Rice on Elizabeth Street in Nolita. A tapas joint, Ñ, followed three years later on Crosby Street, half a block south of Houston.

Not long after, Mr. Walentas was looking for some select restaurants to populate his burgeoning neighborhood—you could call it curation, except this was 1999, and you still might have been shot for saying such things in Brooklyn. He found himself at Ñ, not far from his Soho loft (despite appearances, Mr. Walentas does not live in Brooklyn) where he was thoroughly enjoying himself.

“He left a note on a napkin,” Mr. Lawrence explained, “which he probably thought would be thrown away. It said he’d like to have one of these in Dumbo. We had a look at the place and decided it looked good to us. Sometimes, drunken napkins work.” An outpost of Rice opened on Washington Street in 2000. From there, the two slowly became friends, and Mr. Lawrence even bought a loft there, built by Mr. Walentas’ company, of course.

Walking to dinner one night about five years ago, Mr. Walentas asked Mr. Lawrence what he wanted to do next. Mr. Lawrence confided that he had grown weary of the restaurant business, and, as Mr. Walentas probed, Mr. Lawrence revealed, only half seriously, that he had always wanted to have his own hotel. It was a conversation the Aussie considered inconsequential, but not his American friend. “A week later, we had a zoning map and a subway map, and we were out there looking for a good site,” Mr. Lawrence recalled, still sounding amazed by his good fortune.

“For me, everything in life is about people, and I’ve had the good fortune of almost exclusively working and doing business with my friends, and that was where this project came from,” Mr. Walentas said, sounding like a patron saint. “I was doing this for friendship more than money, though now it looks like we might not do too bad on that count, either.

Mr. Walentas explained that with the maps, the pair was looking for an industrial neighborhood, where zoning allows hotels, that was still accessible to popular parts of the borough—they were always looking explicitly in Brooklyn. After all, the vibe, the scene, the brand, really would not have worked anywhere else.

One of the very first buildings the pair stumbled upon was 80 Wythe Avenue. It had been the longtime home of Newcastle Fabrics, a producer of woven fabrics used everywhere from NASA to Tiki Lounges. Newcastle had moved to North Carolina in the 1990s, and the building had lain vacant for years, gathering all that graffiti. In 2006, with the neighborhood exploding, the family that ran Newcastle decided to sell.

Three other parties were interested in the space, as well, at least two of whom who also had plans for a hotel, according to Mr. Lawrence. The friends were outbid on the property and began looking elsewhere. “It was like meeting the girl of your dreams and then having to go on all these crummy first dates because you couldn’t be together,” Mr. Lawrence said. They looked everywhere from Gowanus to Park Slope and almost took a spot on the border of the Navy Yards in Fort Greene.

“Then, lucky for us, everything fell apart,” Mr. Walentas said.

When the world briefly imploded in the wake of the financial crisis, almost every real estate deal in the city unraveled. Mr. Walentas, however, had the means to swoop back in on 80 Wythe when it became available, paying $9.5 million for the five-story brick building, according to city records.

“In a way, I think we were really lucky to have those two years,” Mr. Lawrence said. “It gave us time to really figure out what we wanted to do.”

Among the things Messrs. Walentas and Lawrence had figured out was Mr. Tarlow. Mr. Walentas had been introduced by a mutual friend to the Diner proprietor, who had also had been mulling the possibility of a hotel in the neighborhood for some time. “When I first paddled across the river in my little boat, I never would have envisioned this—it felt like the country,” Mr. Tarlow said archly. “But over time, it became clear this would not only work but was actually a necessity.”

The three had dinner at Marlow & Sons, hit it off, and a partnership was formed: the builder, the restaurateur, the hotelier.

In one of his last Critical Shopper columns for The Times, right around the time the Wythe was just getting underway, in the July of 2009, Mike Albo highlighted the existence of a particular event each annum in modern New York: the summer hot spot. “Summer hot spots are always very specific,” he wrote. “In the past, it was Elizabeth and Spring; the southwest corner of Seventh Street and Avenue A; Manhattan and Driggs in Greenpoint. This time it’s a two-block section of Orchard below Delancey.”

Without question, the intersection of North 11th and Wythe will be it in 2012.

The place has been popular for some time, with Williamsburg mainstays the Brooklyn Brewery and Beacon’s Closet half a block down North 11th Street. Brooklyn Bowl opened just about three years ago, in a low-slung series of factory buildings at 61 Wythe Avenue, and has been serving up concerts and Blue Ribbon fried chicken alongside the lanes ever since. Last fall, Kinfolk Studios opened on the other corner, at 90 Wythe. Part creative agency, part bike shop, part bar, the space has begun hosting Frej Monday through Wednesday, a pop-up New-Nordic restaurant. It is heavy on the foraging, food cooked in hay and so forth, and with a five-course, $45 menu, it would be easier to uncover a lost Viking longship in Jamaica Bay than secure a reservation.

On May 1, the Wythe opened. Fifteen days later, the rooftop bar began letting guests in. The transformation is complete. Those fears from 2009, from 1999, fears of hoodlums and developers, have vanished.

“It’s amazing, this strip used to be so dead, just empty,” Vice publisher John Martin said last week, after finishing lunch at Reynards—the salmon special and a lemonade, which was “lovely”—with one of the magazine’s contributors. “I remember we used to watch truckers getting blown from our office window, and now you’ve got dude’s grandma’s spending the night on the waterfront.”

“We went from zero tours a weekend to 3,000,” Steve Hindy, proprietor of the Brooklyn Brewery, said in a telephone interview.

Welcome to High Williamsburg perfection. Sidle up to the railing at the roof bar, Ides (named, in a way, after Mr. Tarlow’s fourth child, born on March 15), expert Old Fashioned or Gin Fizz in hand, the sun setting over Manhattan. Soak up paradise while it lasts.

Looking down, there are the painted logos on the wall of a warehouse next door, an installation by artist Steve Powers, which borrows from the borough and the building’s past: Brooklyn Dodgers, Charles A. Fletcher (an early Pepto Bismol), Newcastle Fabrics, Holmes Protection (an ADT predecessor, of which there is a tiny sticker on the neighboring warehouse that the artist copied). Below that is the private side entrance for the events space, capacity 200, beneath which a movie theater is just being finished, in which screenings both public and private will be held.

One of the defining features of the hotel, beyond all the artisanal touches, are the views. These are are facilitated by the structure’s unique design, courtesy of Manhattan architect Morris Adjmi, who specializes in fusing new and old. Along with a team of Mr. Walentas’ in-house designers, Mr. Adjmi worked out a scheme to shave the Manhattan-side of the old building off, and onto the five-story structure the designers sutured a slender eight-story glass Tetris block. The addition is offset just so, to give the sixth floor bar its L-shaped terrace. The glass facade has a tougher, industrial feel, relative to all the would-be sleek boxes on the surrounding streets.

“We didn’t cut any corners,” Mr. Walentas said. “If we had, this just wouldn’t have worked.”

Off the bar are two band rooms, one with four beds, the other with six, an idea that came from across the street, at the suggestion of Brooklyn Bowl’s Mr. Shapiro. The main rooms, on floors two through five, are Manhattan Kings and Brooklyn Queens, denoting the size of the beds and the boroughs they face, with the former having grand views through the floor-to-ceiling glass windows while the latter enjoy punched the punched windows and exposed brick of the original building.

On the top two floors are four loft-style rooms, with kitchens, couches, dining room table and windows on all sides. The top two lofts, on the eight floor, have private terraces. They cost $495 a night and are the most expensive rooms in the building. That is about $150 more than the cheapest room at the W Union Square or the Bowery Hotel—or the nearby Hotel Le Jolie, a nondescript brick tower of 10 stories overlooking the lovely BQE. The Wythe has 72 rooms in total, the cheapest of which are $175-a-night bunk bed rooms, perfect for a pair of friends crashing a wedding, and so cheap they almost beats AirBnB.

They boast 13-foot ceilings, which are original to the building, as is nearly every plank, beam and massive iron column holding them up. The polished concrete floors, with radiant heat inside, are new, though. The beds and desks are new, too, in a way, except that they are made from wood recycled from the building, milled and built by local craftsmen, no less. “We’re very proud of our beds,” Mr. Walentas said. In another backwards nod, an old industrial track still runs throughout the main floor, hanging from the ceiling, the ultimate throwback detail, while the mirrors look old but are actually “antiqued” by some local guys. Ditto the funky light fixtures, what Edison would have created if he had met Picasso.

The nightstands were fabricated locally, as well, and while they are not original, they are the same seafoam color as most of the walls in the building once were. “There must have been a special on this color of industrial paint once upon a time,” Mr. Lawrence said.  The wallpaper, in three flavors, all Brooklyn themed, was designed by Boerum Hill’s Flavor Paper. Every room is stocked with a real refrigerator, a typical hospitality no-no, so as to accommodate Mr. Tarlow’s in-house ice cream in every room, along with other goodies. Instead of tiny bottles of Absolut, the mini bar is stocked with a selection of small-batch distillations.

The hotel’s website, proudly declares: “Wythe has rooms for artists, friends, brewmasters, musicians, concertgoers, mothers, brothers, grandmothers, bowlers, interns, twins, engineers, vignerons, and chefs,” which sounds exactly right.

The same exacting quality is behind every bar (four, counting the event spaces) and on every plate in Reynards. “You won’t read the farmer’s name on the menu because we’re not into boasting, but know that we’ve met every single one of our producers and shaken their hand, and that is the kind of experience we want to share with our guests,” Mr. Tarlow said proudly.

More than neighborhood pretensions, it may be neighborhood realities that have created the Wythe Hotel. After all, if Brooklyn is America’s Fourth Largest City (as one of Mr. Power’s murals, a knock off from Welcome Back Kotter, reminds guests), it is also the least hotelled.

But this is so much more than just 72 rooms and a restaurant, of which the neighborhood already has two—beside Le Jolie, there is the Hotel Williamsburg, a gross Gansevoort knock-off that fits in with the awful new condos, if anything at all.

No, the Wythe is so much more than a hotel. The mold for Williamsburg has been taking shape for a while now, but now it is set. The area, in a decade’s time, is all grown up. And thanks in large part to Mr. Tarlow and his partners, it is a fully-formed brand. All for less than $500 a night—the best bohemian value on the planet.

“There was a strange Swedish reporter here earlier, dressed as Heidi,” Mr. Lawrence said. “Even they’re into it. She was the fashion editor for a paper I don’t remember the name of. She definitely had real blonde pigtails.”

At Ides on Friday night—the sun setting dead center over the MetLife clock tower on Madison Square Park—two tall, stylish gentlemen in their thirties were leaning against the terrace’s brick ledge, on which they had set their beers and motorcycle helmets.

Nathan, a creative director living in Manhattan (who declined to give his full name for what he said were professional reasons) said he used to come to the neighborhood a lot when he was in college a decade ago, but then it sort of died away, but now it is back, and he is here all the time. His friend Raul, an artist, said he was newer to it all, having moved from downtown two years ago to a place off the Lorimer L stop. They said they had just ridden over from across the river to get away from the riff-raff. “I think it’s definitely going to be chiller,” Nathan said. “We were just at the Standard, and everyone was European and wearing suits and being awful, and that’s how we ended up here.”

How long before here is there? It doesn’t matter. It already is. The denialists and the haters just don’t know it yet.

All is quiet on the Eastern front. This is it. Williamsburg.

mchaban [at] observer.com | @MC_NYC

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Matt is The Observer's real estate editor. Follow Matt on Twitter or via RSS. mchaban@observer.com