Swansea High Street is a jumble of deserted, crumbling buildings, fast food restaurants and charity shops. It is routinely branded one of the worst high streets in Britain; a toxic combination of rising rents, shiny new shopping centres and online retailers has sucked economic activity from the area.

From Penzance to Inverness, towns and cities across Britain have been blighted by a similar fate. The proportion of empty shops in Britain is climbing – 10.1% of premises lie vacant, according to an August report from the British Retail Consortium and Springboard.

But Swansea’s high street is fighting back and may provide a blueprint for others to follow, according to Mary Portas, retail expert and author of a 2011 government report on how to revive Britain’s high streets. This wasteland, which links the train station to the town centre, has been adopted by a tribe of artists, actors and entrepreneurs who are breathing new life into the street.

Art galleries, dance studios, a theatre and pubs – like The Last Resort, which is about to be opened by Matt “The Hat” Lawton, who is behind Cardiff’s successful Street Food Circus – are starting to take root. Portas says: “The initiative has to come from the people living in these communities to make it happen. It makes my heart leap to hear things like this, but some towns just don’t have these people to make it happen.”

Fixing the high street by attracting creative industries was the brainchild of Huw Williams, commercial manager at Coastal Housing, a not-for-profit social housing organisation. “I wrote a paper in 2004 that suggested engaging with the creative sector in order to improve the area,” he says. Coastal has bankrolled the regeneration, pumping in £25m: it snapped up empty buildings, built flats and renovated shop and office space.

Gareth Davies, director of development at Coastal, says: “We bought our first parcel of land around here in 1998. We are now starting to see the benefits of the work that began 20 years ago, and that’s how long regeneration takes.”

He says the easy option would be to go for big retailers. But Coastal has stuck to its plan to establish a “creative quarter”. “We turned away some of the chains – the Subways and the Greggs – because that’s not what we want to be,” he says.

High Street art: We Are Here, by Sean Puleston, commissioned by Locws International. Photograph: Dimitris Legakis/Athena Pictures

Coastal’s plan was simple – offer attractive rents to creative businesses and hope they would attract other, similar ventures. It worked. Elysium Gallery & Studios and Volcano Theatre were two of the first of this new breed to find a home on the high street. Elysium opened in 2006 and now rents out studios to about 100 artists across three sites, as well as hosting exhibitions.

Jonathan Powell, director and curator at the gallery, says: “We were here when it was really bad. It was derelict: there were only three or four shops and most of them were off-licences. It was a forgotten place, really.

“There are still problems, don’t get me wrong. But there are now a group of people putting energy back into the street – it’s going to take time.”

As well as attracting the arty crowd, Coastal has targeted young entrepreneurs by signing up TechHub Swansea, which rents office space to 20 startup businesses.

One of these is Veeqo, founded by Matt Warren, who grew up in nearby Llanelli. Veeqo has developed a software platform that performs back-office functions for the likes of Amazon and eBay. It has 30 employees, has already raised £1.4m from investors and is in the process of raising a further £4m.

Perhaps the most visible sign of a renaissance is the giant mural by sought-after artist Pure Evil of the film star Elizabeth Taylor, emblazoned across the Volcano Theatre building. Pure Evil, aka Charles Uzzell-Edwards, said he wanted to “play my part” in the street’s makeover, as it held good memories for him.

Taylor’s visage glares down at a gang of art college students across the street, who chatter excitedly as they push the immaculately painted red door to enter Galerie Simpson.

Inside the elegant Aladdin’s cave of paintings and sculptures, Jane Simpson greets the budding artists. Simpson grew up in Swansea, but studied at the Chelsea College of Art and the Royal Academy of Art in London.

Jane Simpson, owner of Galerie Simpson. Photograph: Dimitris Legakis/Athena Pictures

Simpson quit London just over three years ago to return home. She has been pleasantly surprised by the newfound confidence that is coursing through her hometown.

“I think Swansea is a very different place now – there is a lot of energy. We are not Cardiff, which is good because big towns have to deal with big expectations. There’s always been that grit in the oyster in Swansea. We can be a bit more maverick here.”

Portas reckons this nascent regeneration will show other towns that change is possible. “The truth is, you can make regeneration happen,” the retail expert says. “If you have a community of people that want to make change happen. However, there are councils that just can’t see a way out of it.

“You need vision – these people who are doing it are obviously rooted in that community. If you have people living there, that’s when change happens. Good for them.”