What motorists notice first as they speed south along Italy’s A22 motorway, a key Alpine route that links heartland Europe to the Mediterranean, are the neat rows of terraced vineyards that adorn the hillsides. At 77km from the Austrian border, the road tunnels give way to a wide valley, blanketed in apple orchards, and the exit for Bolzano soon appears. Capital of South Tyrol and gateway to the snow-capped Dolomites, the city sees 25 million visitors pass through it annually, en route to nearby wineries, weekend spa getaways and skiing holidays.

But recently the city of Bolzano has witnessed a different type of influx, with entrepreneurs, high-tech workers, returning graduates and foreign academics moving in, pushing the population over the 100,000 mark for the first time in two decades. They are attracted here by the efficient public services, multicultural atmosphere and proximity to nature.

“The environment here is great. In 10 minutes, you can leave work and be up hiking on the trails,” says Bernd Jochum as he chews on a mid-morning croissant and admires the mountain vistas from his office. Jochum, 39, runs Jochum & Nesler, a firm he launched in 2003 that designs kite-surfing equipment. Raised in Munich, Jochum moved to the area after three years in Hong Kong selling snowboards.

“I was afraid to go outside in Hong Kong, the air was so bad. Now I live in a beautiful place and we have lots of lakes and slopes close by to test our kite boards on. What could be better?” he asks. With the company set to make €1.5m in sales this year, he has no regrets about relocating. “I can serve all my European markets from here, it’s that simple. Our products are made in Asia and arrive by boat in Trieste. From there, they are trucked up to us.”

Starting Jochum & Nesler was that much easier thanks to Bolzano’s business “incubator”. Housed in the low-rise industrial quarter, the twin-towered TIS centre was set up in 1998 to assist local start-ups yearning to make it big.

“The banks were not used to working with new companies, only traditional ones. TIS helped to arrange funding for us,” says Jochum. TIS (Techno Innovation South Tyrol), which receives half its operating budget from public coffers, is an example of how authorities in Bolzano are planning for the future. Maurizio Bergamini Riccobon, a director of research for the local government, says: “With globalisation, we are seeing less manufacturing as firms outsource. What we need is to create more know-how, more research and attract graduates with higher-skilled jobs. We can have the factories elsewhere but let’s have the brain power, the ideas, here.”

Entrepreneurs with a business plan receive affordable office space at TIS and are given three years to prove themselves. Tenants are offered IT support, a cafeteria, in-house workshops that invite leading companies such as Pixar to talk, as well as access to a network of 150 experts (some on-site), who share their knowledge on topics ranging from marketing to renewable energy. “The only time you need to leave is if you want to get some gelato,” jokes Gianluca Vignoli, who – with three colleagues – rents an office for their environmental consulting business.

Even those who left South Tyrol for seemingly greener pastures, like 34-year-old Christian Tasser, are returning. “I did a video conference with the TIS director and decided I could apply my experience here,” recalls Tasser, an environmental engineer, who spent six years in southern California helping firms recycle industrial waste water. “Los Angeles wasn’t a place I wanted to raise a family.” He now consults for public utilities, including a proposal for a desalination plant in Italy’s arid Puglia region. Returning with Eunice, his Korean-American wife, and their three-year-old daughter, Tasser was surprised by what he found. “Bolzano has definitely changed. It’s more open minded and multicultural today; the city is no longer just the bridge between the German-speaking culture and the Italian one.”

Formerly part of Austria, South Tyrol was ceded to Italy after the First World War and, under Mussolini, waves of immigrants were sent north to the city. Today, bilingual signage litters the visual landscape and the separate German and Italian schools instruct pupils in their native language, but ensure they learn both, along with English.

Granted autonomy by Rome over how it spends tax receipts, the province has become a model of public administration. International rating agencies, such as Moody’s and Fitch, award it higher credit ratings than the Italian state for the efficient way it manages its €4.5bn budget. Luis Durnwalder, president of South Tyrol, checks off some of the advantages residents can enjoy. “We are the richest province in Italy, with €34,000 per capita; that’s higher than Milan. Unemployment is at 2 per cent, there’s a strong work ethic and we don’t have strikes.”

That said, Durnwalder, who rises at 05.30 on weekdays to hear citizen complaints for two hours in his office before his regular work day starts, is far from complacent. He wants more to be invested in research and development (the province spends less than half a per cent of its annual budget on innovation) and so a new €200m technology park is in the pipeline. Situated on a four-hectare brownfield site, it will convert 1930s Bauhaus-inspired factories into labs where researchers can study solar, biomass and wind energy, helping South Tyrol achieve its goal of being 100 per cent free of fossil fuels by 2020. Though it represents just 2.5 per cent of the surface area of Italy, South Tyrol has a third of all solar panels installed in the country.

Until recently, a set of fascist-era buildings was left to rot away – the auditorium was last used for screening adult films during the 1980s. Now, skillfully restored for EURAC, a research institute that opened in 1992, its glistening glass cube of offices is equipped with rooftop solar cells to generate its electricity.

At the offices of Microgate, a staff member dons a mask before entering the clean room, while outside the oleanders and palm trees bask in the sun. People move about with a quiet purpose at this company, which was set up by serial entrepreneur Roberto Biasi, inventor of a super-intricate mirror that is installed in some of the planet’s largest telescopes.

His company now develops monitoring equipment that uses infra-red sensors to break down an athlete’s biomechanics as they run. Clients include football clubs Juventus and Chelsea. In an adjacent wing, staff experiment with a single photon sensor that NASA and Fujitsu have already purchased, since it’s known to have cryptography applications. “We are in talks with a US company that wants to use the sensor to try to detect biohazards at airport screening stations,” explains Biasi.

Biasi is excited about the efforts to reposition Bolzano as more than a tourist stopover. “Thanks to the local government, we see an increase in tech firms. Since you can work anywhere today if you have an internet connection, why not be in the mountains?”

Bolzano Airport’s runway can’t accommodate 737s, so local mover Air Alps gets the job done with Dornier 328-110 turboprops, flying daily to Milan and Rome. For long-haul destinations, travellers drive an hour south to Verona, from where Air Dolomiti shuttles passengers to Lufthansa’s Frankfurt and Munich hubs. South Tyrol is serious about cycling and Bolzano has 42km of bike paths.

Bicycles are welcome on the roomy, Swiss-built light railway. Engineers have begun survey work on the 55km Brenner Base Tunnel, expected to open by 2022. The plan is to put two million trucks and trailers, which currently travel on the A22 motorway (the Alps’ busiest north-south roadway for cargo), on to rail and also reduce travel times for trains operating between Munich and Verona.

The 15th-century tavern Batzenhäusl (batzen.it) is a venerable institution and great after work. There are traditional beer halls and outdoor dining, where canederli dumplings can be sampled. Lunch under the summer awnings at the Parkhotel Laurin (laurin.it) is followed by a stroll around the gardens. A great tourist-free spot for an espresso is the courtyard café attached to the Cinema Capitol. The food stalls around Piazza delle Erbe sell local fruit and vegetables and cured meats. Resident Kareen Raynaud advises going on Saturday mornings, when it’s most lively because there is another bigger market just over the Talvera bridge.

For tasting aromatic Gewürztraminer or garnet-red Lagrein, enthusiasts should follow the wine road (weinstrasse.com) through rolling hills and past quaint villages, from Appiano down to Magrè. Designed by Bolzano native and architect Matteo Thun, the nearby public baths complex in Merano (termemerano.com) is open 365 days a year.

Space is at a premium in Bolzano, and buyers in the city centre can expect to pay €6,000 to €8,000 per sq m for choice flats. In scenic San Osvaldo a three-bedroom residence with garden and garage can top €1m. Those looking for a cheaper option can opt for the Gries district. Bottura and Benedikter are two experienced estate agents that can help homeowners deal with notary fees and mortgage financing. With bordering Austrian businesses paying a 25 per cent rate of corporate tax, local officials might want to lower theirs (37.5 per cent).

Wine production in South Tyrol may not yet have the footprint of Tuscany or Piedmont, but its vintners shouldn’t be overlooked. Sixty per cent of the area’s 5,000 hectares under cultivation is devoted to reds, such as the full-bodied Lagrein. But recently the area’s whites (Pinot Grigio foremost among them) have been gaining in reputation.

One key producer is Alois Lageder, who was ahead of the curve when, in the early 1990s, he decided to use green energy for his Löwengang winery. The business produces no CO2 emissions thanks to a solar-powered electricity unit. “When I decided to do this, nobody was talking about sustainability,” says Lageder.

The recent boom in hi- tech hasn’t spelled the end of heavy manufacturing in Bolzano. Built by Iveco, a Fiat subsidiary, the LMV 4x4 vehicle offers peacekeepers increased protection against roadside bombs. Equipped with a diesel engine and composite armour, there’s already a backlog of orders.

Bolzano’s new multicultural vibe is attracting creative types. After studies at Zurich’s School of Art and Design (HGKZ), native Massimiliano Mariz returned to open Typeklang, a graphic design agency specialising in brochures for museums and cultural centres.