Andrew Allen / San Sebastián, Spain. It isn’t a surprise, then, while visiting the Villa Labeas, a modern property with a Swiss feel set amid the remains of a 19th-century fort, to find that the three-Michelin-starred restaurant Arzak is just a quick stroll away. “It’s a five-minute walk downhill,” the villa’s owner, Maite Urrutia, said of the restaurant, which played a major role in introducing the so-called New Basque Cuisine in the late 1970s. “And a considerably longer one back up with a full stomach.”
Mrs. Urrutia and her former husband bought the property, enclosed by the walls of the San Martín fort, 13 years ago. Now she is selling it through Engel & Völkers San Sebastián for 7.5 million euros, or about $8 million. The nine-bedroom villa stands near the summit of Mount Ulia, one of several hills overlooking San Sebastián.
The fort was built during the Carlist Wars, which racked Spain in the 19th century, with a commanding position over the city. The walls now enclose honeysuckle-scented gardens, and Napoleonic-era cannons purchased in France by Mrs. Urrutia’s ex-husband stand on the battlements.
The property, with a floor area of 743 square meters, or about 8,000 square feet, is split into two adjoining homes connected with a single interior doorway, but they are being sold together. The villa is built of stone from Mount Ulia, with oak trim in the interior.
A wood-paneled attic suite at the top of the house has partial views over the city’s scallop-shaped bay, La Concha.
Bordering this beach, with its characteristic ornate white wrought-iron balustrades, are the city’s most desirable streets. A recent study of prices across Spain by Engel & Völkers rated Calle Hernani as Spain’s most expensive street and Calle Zubieta second.
An apartment on the corner of Calle Hernani and Calle Peñaflorida with views directly over La Concha and the Alderdi Eder gardens is on the market with Engel & Völkers for $3.45 million.
The 350-square-meter property has exuberantly decorated stained glass windows by the French firm Maumejéan.
San Sebastián owes much of its reputation to its association with Spain’s royal family, which began to take vacations in the resort in the mid-19th century. Much of the country’s aristocracy followed suit, and in the construction boom that followed, the city’s seafront gained its elegant, Belle Époque feel through standout buildings like the salt-water spa La Perla.
During World War I, Spain’s neutrality and the resort’s proximity to France drew wealthy pleasure-seekers from across Europe to the resort. Later on, General Franco spent summers in the city.
History hasn’t always been kind to San Sebastián. The armed struggle for independence from Spain by the Basque separatist group ETA claimed more victims here than anywhere else in Spain.
Michel Garcia, managing director of Engel & Völkers San Sebastián, said that many business owners fled the city during those years to escape the “revolutionary tax” imposed upon businesses to fund ETA activities. But in 2011, ETA renounced the armed struggle, and now returning exiles are one of the main forces driving the property market, he said.
“This has always been one of Spain’s wealthiest cities, so these individuals often bring a significant amount of capital with them,” Mr. Garcia said.
Another factor attracting buyers, particularly foreign ones, is the city’s gastronomic reputation.
As well as its Michelin-starred restaurants, there is the Basque Culinary Center, an institute set up in 2011 by a group of the city’s noted chefs that teaches avant-garde culinary techniques.
There are numerous gastronomic societies.
An entirely different side of the city’s gastronomy can be found in the atmospheric, cobble-stoned network of narrow streets in the old town. Here small bars vie with one another to provide the best spreads of pintxos, or Basque tapas, and are proving to be a particular draw for foreign property buyers, Mr. Garcia said.