The owner of a downtown Bolinas property that has sat derelict for five years has sharply reduced the asking price, bringing renewed hope to residents who long to see the once-thriving community hub enjoy a renaissance.

The property, known as the Waterhouse complex after one of its two side-by-side buildings, houses a liquor store and the town’s shuttered post office. Gregg Welsh, the retired Santa Barbara dentist who owns the property, put it on the market two years ago for $5.2 million. But last month, Oceanic Realty relisted the complex at an asking price of $3.5 million and put a for-sale sign out front. 

“I believe the owner is motivated to find a new buyer, and I think a fresh approach to the property could be very positive,” said John Borg, a Bolinas resident who helped lead a campaign to reopen the post office. 

Before the compound’s historic namesake building was badly damaged by a fire in 2020, it housed four apartments, a book exchange, a hair salon, a real estate office and a surf shop. A planned renovation of the building stalled out amid a legal dispute between the contractor and Dr. Welsh. 

The adjacent building still houses Don’s Liquor and is the once-and-future home of the Bolinas Post Office, which closed in 2023 amid a landlord-tenant dispute but is expected to reopen this fall. Dr. Welsh and the United States Postal Service signed a new 10-year lease in April.

“Between the fire and the closure of the post office, it’s created this black hole of emptiness in our downtown that we haven’t recovered from,” Mr. Borg said. “But the lowered price and the return of an anchor tenant to bring traffic and life will make it a more attractive investment.” 

When Dr. Welsh first listed the property, community members attempted to recruit a buyer. Members of the Bolinas Civic Group brainstormed ways to revive the complex but concluded that nothing would pencil out at the asking price. 

They had run numbers and scenarios through a model devised by Megan Matson and Peter Luchetti, whose firm finances community infrastructure projects. “At the old purchase price, we concluded that making a project work was a no-go,” said Ms. Matson, who ran new numbers through her calculator this week. “We found that at $3.5 million, it looks like you could swing it.”

Through his attorney, E. Patrick Morris, Dr. Welsh declined to comment. “Beyond the listing information, Dr. Welsh has no further comment other than to confirm that the building is for sale, and he hopes it sells to a buyer with the best interests of Bolinas and its citizens in mind,” Mr. Morris said.

The property includes three water connections—highly valued commodities in Bolinas. Yet filling commercial spaces has become increasingly difficult in West Marin, where profit margins are slim and workers are in short supply. Historic properties in many villages have stood vacant for years.

Chris Hulls, a Point Reyes Station tech entrepreneur and philanthropist, this year launched a nonprofit foundation to buy key properties and prevent them from crumbling or falling into the hands of outsiders who don’t share local values. So far, the Good Luck Fund has purchased two vacant restaurants and the Old Western Saloon. With input from the community, the fund is seeking new tenants with creative proposals to fill its empty properties.

“Bolinas needs a Good Luck Fund,” said Caren Quay, who helped lead the Bolinas Civic Group’s study of the Waterhouse property.

Mr. Borg is hopeful that someone—an entrepreneur, a philanthropist or a hybrid of the two—will step up to buy the complex. Three years ago, when the property’s prospects were especially bleak, members of the Bolinas Cannabis Club held an exorcism at the site, hoping to drive away evil spirits they feared had infiltrated it.

“Oddly, I think it might have worked,” said Mr. Borg, who did not participate in the ceremony.