This sun-splashed metropolis is one of the most picturesque cities in the Middle East, free of ethnic tensions and far removed from too-cool Tel Aviv and religious Jerusalem.

Israel’s third city, Haifa, a sun-splashed metropolis on the Mediterranean Sea, is rarely thought of as a tourist destination. Until recently its best known landmark was the Dagon Grain Silo, while its rusting port was filled with smoky bars where salt-caked longshoremen would drink strong liquor before returning to the sea-bound frigates. 

Fast forward to the present and Haifa is one of the most picturesque cities in the Middle East. Its downtown is a wholly different place, with chic Middle Eastern restaurants along Ben Gurion Avenue, freshly planted palm trees in Paris Square and throngs of tourists skipping off cruise ships in the renovated port. The longshoremen have been joined by groups of students and artists who stay in eco-friendly dormitories.

These changes are government initiatives, created to transform Haifa’s blue-collar, industrial image into something more hip and welcoming. But the real catalyst for change has been Haifa’s vibrant student population and its unique assembly of Arab and Jewish residents living in mixed neighbourhoods.

The full Haifa alternative experience starts with a subway ride from Paris Square to Masada Street, located halfway up Mount Carmel, upon which Haifa is built. Tucked into a narrow bend on this leafy road stands a half dozen miniature cafes where poets, activists and writers socialise over strong cups of Arabic coffee and bowlfuls of hummus. The best known is Café Masada (16 Masada Street; 052-657-3937), where the chatter is politically-charged, heated and philosophical. Left-wing points of view are typically the dominating theme in this liberal corner of the city.

The culture trail continues in nearby Wadi Nisnas, where narrow lanes are squeezed between sandstone buildings that date back more than a century. This is the old Arab quarter, and despite its ramshackle appearance (or perhaps because of it) Wadi Nisas has gained a popular following for anyone seeking a traditional Middle Eastern meal. After a falafel snack at 50-year-old eatery Felafel Hazkenim (Wadi Nisnas Road; 04-851-4959), wander the back alleys and discover a zany collection of colourful street art.  

Further up the mountain looms Carmel Center, a leafy, well-to-do neighbourhood that is always a few degrees cooler than the port area below. Hipness in Carmel Center comes in the form of trendy coffee shops, including local favourites Greg Coffee and Mandarin, where students come to sip lattes and schmooze. The Carmel Centre is also home to the Cinematheque, a classy movie theatre that screens Israeli films and independent foreign flicks.

Brave creative types may prefer to meet up with local painter Shahar Sivan, an eccentric young artist who opens his studio every Monday at 8 pm (Nemala Studio, HaNamal 35; 052-567-0505) for an evening of drinks and nude portrait drawing. Shahar mixes cocktails, sets up easels and helps his students perfect the difficult art of drawing the exposed human form. It may sound a little off the wall, but Haifa likes to embrace its weird side.

The energetic vibe of the city is best felt on Tuesday nights in the port area, when popular restaurant Mayan Habira, meaning “Fountains of Beer” (4 Nathanson Street) hosts an weekly outrageous rhythm and blues revival that gets folks dancing on the tables. Rocking out to the blaring guitar riffs, wailing harmonica and gut-rattling drum rolls by house band Kostiza is a great way to kick off a night of bar hopping.

Other nearby watering holes include pocket-sized and mellow Jack and the Beanstalk (44 Jaffa Road; 04-853-5668), the larger and louder Barki (84 Hatzmaut Street; 054-425-8904), Eli’s Bar (35 Jaffa Road; 054-635-4696), which is good for live music and La Bira (21 HaNe’emanim Street), renowned for its house-brewed beer. For dancing, try nearby Syncopa (5 Khayat Street; 050-918-8899), which keeps the port rocking until the small hours.

Another strictly Haifa experience is spending a late night at Tichon in the Hadar neighbourhood. This hipster hangout hosts an eclectic mix of live music acts ranging from avant-garde to Arabic hip-hop and Hebrew folk ensembles. The owners, Suzan and Yoni, form a unique Arab-Jewish partnership, but the cross-cultural business arrangement does not seem out of place in Haifa, a mixed city where Arabs and Jews mingle freely, seemingly unaware of the ethnic tensions simmering in other parts of Israel and the Palestinian territories.

The Haifa tourist office has yet to adopt “Hip Haifa” as a slogan for the city, perhaps because the city’s funky side remains a largely underground phenomenon beyond the grasp of government officials. But most Haifans like it that way. It is a low-key place, far removed from uber-cool Tel Aviv and religious Jerusalem. Here locals are carving a unique niche as a place where young Jews and Arabs coexist and collaborate on their progressive ideas.

For visitors looking for something different, Haifa’s hip spots are experiential and unique on every visit – bring your sketchbook, open mind and blue-collar shirt, and get set for the unexpected.

The article 'Hip Haifa, Israel’s third city' was published in partnership with Lonely Planet.