The Wall Street Journal-20080216-Encore -A Special Report-- Seaside Splendor- Cannon Beach in Oregon has no hospital- pharmacy or mail delivery- And for most residents- none of that really matters

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Encore (A Special Report); Seaside Splendor: Cannon Beach in Oregon has no hospital, pharmacy or mail delivery; And for most residents, none of that really matters

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It's the Saturday after Thanksgiving and, as usual, the Coaster Theater in Cannon Beach, Ore., is sold out, this time for a performance of "The Sound of Music." The theater has a full slate of comedies, dramas and musicals scheduled for 2008, with a subscription to the complete package of seven performances available at $100 a seat.

That's one of the few bargains left in Cannon Beach, a seaside town that has become a prime destination for retirees from Portland and Seattle, especially those with money. "Healthy, wealthy professionals. That's the profile," says real-estate attorney Charles Hillestad, who moved here with his wife 13 years ago from Denver to ease into retirement while running a small local practice.

With about 1,600 year-round residents, Cannon Beach is tucked between Oregon's lush Ecola State Park and a stunning coastal archipelago punctuated by massive Haystack Rock. Summer temperatures rarely climb above 70 degrees; winters are mild, if wet.

There's a civility about the place that's carefully cultivated. Strict rules govern renting homes to vacationers, operating a bed and breakfast or erecting signs at commercial sites. Fast-food restaurants are banned. (Officially, Cannon Beach prohibits establishments "required by contractual or other arrangements to offer standardized menus, ingredients, food preparation, interior or exterior design, or uniforms.")

Bookstores abound, but there's only one gas station, outside of town at the RV park. Indeed, Cannon Beach, on close inspection, seems to lack many of the amenities that people often associate with a retirement destination. The town has no hospital or pharmacy and no assisted-living facility. There's no mail delivery, either; letters and packages have to be retrieved at the post office. In short, it's no place to be frail or infirm.

It is, however, a place of uncommon beauty and a surprising amount of activity, given the town's size. Art is the big draw. Galleries open the busy summer season with a Spring Unveiling in May, then kick off the Thanksgiving-to-New-Year period with the Stormy Weather Arts Festival in early November. Glasses of complimentary white wine and local pinot, plates of shrimp hors d'oeuvres and puff pastries help fill the galleries with locals and visitors.

"It takes care of your dinner for the night," says Martha Bennett, a retiree active in Cannon Beach's amateur chorus, 30 singers who have been together since 1988 and practice every Monday night at the Cannon Beach Community Presbyterian Church.

Hemlock Street, the town's main drag, runs parallel to the Pacific shoreline. A few wood-shingle homes have been converted into pricey restaurants, including one serving Thai food and another offering cuisine from northern Italy. The southern end of Hemlock Street is given over mostly to single-story motels and beach cottages, which are packed in summer months and draw a steady weekend trade through early autumn.

It's not all the carriage trade. Bird watching and beach strolls are free. Haystack Rock, which rises to a height of 235 feet, is Cannon Beach's landmark. At low tide, the sand nearby reveals a treasure- trove of sand dollars (many tiny enough to be sand dimes) and occasionally is graced by sunning sea lions.

Retirees flock to the $5 Burgers & Jam on Monday nights at American Legion Post No. 168, as well as the post's monthly Oyster Feed ($12) and a $5 Saturday breakfast also offered once a month. Dooger's, a seafood institution on this stretch of coastline, has half-off nights for customers 60 and older at each of three locations: Thursdays in Cannon Beach, Mondays in Warrenton and Tuesdays in Seaside.

Seaside and Warrenton, respectively eight and 20 miles away, are Cannon Beach's satellite business districts. Seaside has the closest hospital and pharmacy; Warrenton has the nearest Costco and Fred Meyer, a big Oregon retailer.

Catering mainly to Portlanders who make the 80-mile trip for a day or weekend during summer months, Cannon Beach grew its retirement niche from families who built second homes here, which became permanent homes as family nests emptied. A new element has been introduced in recent years as dot-com fortunes seep in from California and Seattle. That's brought a wave of teardowns followed by the rise of seaside McMansions.

Local officials are focused on trying to control commercial development. Bed-and-breakfast operators can offer lodging in no more than two bedrooms, and owners must live on the property. John Williams, a retiree who was elected Cannon Beach's mayor in 2006, says his town has been more restrictive than others along the Oregon coast.

"People saw neighborhoods becoming commercial zones," says Mr. Williams, who has lived in Cannon Beach since 1972. "We've reached a good compromise: We haven't banned short-term rentals, but we've limited them."

In all, just over a hundred properties in town are officially designated for unrestricted short-term rentals; if any of those are sold, those rights are rotated among existing homeowners. Anyone buying a house today is restricted to one rental of any length every 14 days, says Tami Florer of Cannon Beach Property Management.

Along with the Coaster Theater and the art galleries, Cannon Beach has a gourmet cooking school and a summer music-study program offered by an extension campus of Portland State University. The effect is sort of Ivy League-by-the-shore, with matching prices. Oceanfront homes routinely sell for well over $1 million, if you can find one that's available: Realtor Duane Johnson says no oceanfront home was offered for sale in 2007. Even homes off the beach carry a hefty price tag. Condominiums are available in the $350,000 to $500,000 range, many within walking distance of the pounding surf.

Like many recent retirees, Doug and Judy Wood relied on a fortunate family connection to come here. The Michigan couple's oldest daughter attended the University of Oregon and moved to Cannon Beach after graduation. She had friends who were aware of a piece of property for sale in 2002, one much too expensive for them to buy alone. Instead, this couple and the Woods agreed to buy the property and split it into two half-acre parcels that each could afford. That was enough to swing the deal.

After netting about $425,000 on the sale of their home in suburban Detroit, the Woods built a two-story house from plans of a Cape Cod- style retreat they had seen outside Seattle. Buying a similar house in Cannon Beach in 2002 would have cost over $600,000, Mr. Wood says. Today that same house would be worth about $850,000.

"Compared with what we sold for in Michigan," says Mr. Wood, 69, "it would have been a real stretch to buy this house."

With Portland so close, Cannon Beach residents have easy access to one of the nation's most elegant cities, where they can find premier museums and restaurants and the National Basketball Association's Trail Blazers, among other attractions. But locals gripe that the trip -- which typically takes about an hour and a half by car or bus -- is a drag when it's done out of necessity, as it frequently is for shopping or medical care. A bus line with a single daily run connects Cannon Beach to Portland's Amtrak station and airport. Another option is Partners for Seniors, a motor pool of mostly retired Cannon Beach residents who serve as drivers for other retirees.

Many retirees here say they cut down on shuttling back and forth by keeping a second residence in Portland, either an apartment or condominium, or perhaps a spare room at a family member's home.

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Mr. Millman is a staff reporter for The Wall Street Journal in Portland, Ore. He can be reached at [email protected].