The original site was first occupied by a man named William Clubley in 1845 and was most likely a private residence.

[citation needed] In 1896, John W. Kerr, an employee of the East India Company,[3] took over the lease and made numerous improvements to the site, naming it "the Crag",[2] and it became a popular retreat for Europeans living in George Town and on Penang Island as a place to escape the intense heat and humidity of the lower coastal areas.

[4] In the late 1880s, the lease was taken over by four Armenian immigrants, the Sarkies brothers, and following minor renovations was turned into a hotel that boasted nine bungalows.

[2] Most of the hotel was completely rebuilt in 1930, and it continued operating until the Second World War, when it was requisitioned by the occupying Japanese army,[3] who turned it into a prison for British captives.

[7] After the war, the building fell into disuse for a number of years, until it was leased to the Uplands School in 1955.