It has been said that Munich is really a Millionendorf, a ''village'' that just happens to have over a million residents. And indeed there is a villagelike ambiance to its lively, pedestrian-crowded streets, lined with beautifully restored Renaissance and baroque buildings rather than towering skyscrapers, neon billboards, and the other usual trappings of urban life.

But if Munich has managed to escape some of the worst features that can befall a city of its size, it has also done much to encourage the best. Art, music, historic treasures, good food, and, above all, a sense of style and vitality abound in the Bavarian capital - all reasons why it is such an enjoyable and justifiably popular place to visit.

Arriving in the Munich of the 1980s, it is almost impossible for the visitor to imagine that this handsome, prosperous city was all but reduced to a pile of rubble during World War II. The easier and far less expensive choice would have been to sweep the wreckage aside and replace it with a modern city of glass and steel. But instead hundreds of skilled craftsmen have spent the past four decades reconstructing and restoring the bomb-ravaged buildings to their former splendor and grace.

That all of the time and expense have been worthwhile is especially evident when one stands in the Marienplatz, the main square of Munich and the city's geographical and historical heart. Visible from the square is the tall, peak-roof tower of the Altes Rathaus (Old City Hall), which dates from 1474. Munich's most distinctive landmark appears in the opposite direction, the twin onion-dome towers of the Frauenkirche, a magnificent Gothic cathedral that has been almost completely rebuilt since the war.

But the principal reason that visitors flock to the Marienplatz is not to admire antiquity, but to see the daily glockenspiel performance that takes place in the turreted late-19th-century tower of the new City Hall. Daily at 11 a.m. (and also at 5 p.m. during the summer) the crowds stand enthralled as life-size painted-copper figures spring into action, reenacting charming scenes of 16 th-century life.

A sizable area surrounding the Marienplatz is open to pedestrians only, flower-decked thoroughfares that make shopping and exploring on foot particularly pleasant. Along the way are dozens of cafes offering traditional Bavarian fare, including the celebrated Weisswurst (white sausage), a succulent mixture of veal, pork, and parsley that, according to custom, should be eaten before noon with a special sweet-flavor mustard. Not to be missed is a stop at Dallmayr, a gourmet food shop on Dienerstrasse that has been called the Tiffany's of delicatessens. Here are 120 varieties of sausages, a mind-boggling array of salads, pates, and pastries, as well as exquisite chocolates that are small works of art.

More Munich flavor, in every sense of the word, can be found at the Victalienmarkt, a huge open produce market to the southwest of Marienplatz behind Peterskirche. Strings of sausages and garlic hang from stalls laden with beautifully displayed fruits, vegetables, and cheeses from all over Europe. Just as interesting to see is the way the townspeople, often dressed in loden-color coats and feather-top felt hats, bargain with the market vendors.

Overshadowing the market is the venerable tower of Peterskirche, which sports no less than eight clocks. The history of Peterskirche goes as far back as Munich itself; the church was built by the same monks who founded the city in the 11th century. Over the years the symbol of Munich has remained the Munchner Kindl, with its motif of a child dressed in monk's habit.

From the 13th century until 1918, Munich and the rest of Bavaria was ruled by the Wittelsbach family, as dukes until 1628, as electors until 1806, and as kings from then on. The magnificent palaces and art treasures that generations of the rulers left behind make for some of the finest sightseeing the city has to offer.

Most impressive is the Residenz, the rambling palace that was the royal family's principal residence. Located at Max Joseph Platz just two blocks from the Marienplatz, the Residenz is an enormous amalgam of just about every architectural style from the Renaissance through the Empire period of the early 1800s. The Residenz was nearly demolished during World War II, and its continuing restoration is one of the most ambitious projects of its kind in the world.

Both because of its immense size and the fact that it is far more beautiful inside than outside, the Residenz is often excluded from the usual sightseeing tours of Munich. But the glory of its history, its architecture, and its priceless art treasures make it well worth spending the full day it requires.

Even if the time for touring the palace cannot be spared, visitors should at least visit the Treasury of the Residenz. Here in 10 dazzling rooms are Wittelsbach heirlooms that date from the 9th century. Gold crowns and portable altars, some of them a thousand years old, are studded with precious and semiprecious stones. Most spellbinding is the gold and silver figure of St. George slaying the dragon, containing 2,091 diamonds and 406 rubies.

Two tours of the palace, both self-guided, are available daily, a morning tour that admits visitors to the baroque and rococo sections and an afternoon one that takes in the earlier wings. A highlight is the 2,165-foot-long Hall of Antiquities, which has served as a magnificent festival hall since 1486. The largest and most important Renaissance secular interior in Germany, the hall has a vaulted ceiling covered with stunning Italianate frescoes.

The Cuvillies Theater is an important part of the tour of the Residenz, both for its rococo beauty and the part that it has played in musical history. In this little jewel box of a theater with its four graceful balconies ornamented in gold Mozart premiered two of his operas, and other famous composers of the day performed their works for the royal family. Today visitors can still enjoy concerts in the same setting.

The theater was named for a French architect named Francois de Cuvillies the Elder who also designed some of the most splendid rooms in the Residenz and much of Nymphenburg Palace on the edge of the city, the summer residence of the royal family.

Acknowledged to be Cuvillies's masterpiece at Nymphenburg is not the palace itself, grand though it is, but small Amalienburg, the hunting lodge of the royal family, which he completed in 1739. Nestled in a forest setting, the exquisite lodge rooms, embellished with elaborately carved silver ornamentation, are rococo architecture at its most delightful. Among the fine portraits in Amalienburg is one of the royal family, all dressed from head to foot in pale-blue silk, about to embark on one of the hunts they loved so well.

Other legacies from the Wittelsbachs are evident throughout Munich, particularly in the city's many excellent museums. At the Konigsplatz, a neoclassical square reminiscent of Athens or ancient Rome, King Ludwig I built the Glyptothek and the Antikensammlungen, two templelike museums that house considerable collections of Greek and Roman antiquities.

It was Ludwig I's son, Maximilian II, who started another of Munich's great museums, the Bavarian National Museum. On the upper floors are magnificent furnishings, tapestries, sculpture, etched armor, and other objects used by the Bavarian nobility. Just as interesting are the downstairs collections of peasant furniture and folk art. Among the folk art is the prime reason for visiting the museum: a collection of beautifully carved Bavarian and Italian nativity scenes displayed in illuminated settings.

Art museums abound in Munich. The oldest and most renowned is the Alte Pinakothek, a gallery housing important works by Rubens, Durer, Botticelli, Raphael, and many others. At the Haus der Kunst are a pair of museums that focus on the Impressionists and German romantics. The work of Munich artists predominates at the Stadische Galerie in Lenbachhaus, a 19th-century mansion with a collection spanning everything from medieval works to those of Paul Klee.

Although the treasures of the past predominate in Munich, the Deutsches Museum, a massive building occupying its own island in the Isar River, celebrates the more recent decades of technical invention. Its hands-on exhibits of airplanes, locomotives, ships, and scientific marvels make it an especially good place to bring children.

While Munich has much to offer in the way of indoor activity, it also includes outdoor pleasures as well. It is possible to catch a ride on one of the enormous log rafts that carry up to 60 people down the greenish-white Alpine waters of the Isar River, which flows through the city limits. For picnicking and strolling there is the English Garden, a lush and lovely city park that, like so much else in Munich, invites one to linger and enjoy. Practical information:

The Munich Tourist Office offers a good selection of city sightseeing booklets, maps, and information on budget tours and accommodations. Its ''Young People's Guide to Munich'' is especially helpful for those interested in youth hostels and other economical ways to visit the city. A schedule of concerts at the Cuvillies is also available. Write to Fremenverkehrsamt der Landeshaupstadt Munchen, Postfach D 8000, Munchen 1, Germany.

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