[3] The original building, a single-storey bungalow, called 'Barnes Hall', was constructed as the holiday residence of Sir Edward Barnes,[4] the fifth Governor of Ceylon (1776–1838) in 1828,[5] for the sum of £8,000.

It was subsequently purchased by Reginald Beauchamp Downall (1843–1888), a planter and member of the Legislative Council of Ceylon, who operated it a small guest house/hotel.

[7] William Milsom, owner of “property...... known as Barnes Hall on which is built the Grand Hotel” sold it to the Company for Rs.

Notable guests who have stayed at the Grand include the Duc d’Abruzzi (brother of the Italian Sovereign), Leopold of Saxe-Coburg-Gotha (nephew of King Edward), the Grand Duke of Saxe-Weimar, Prince Reuss XXXII, the Maharaja of Kapurthala, Jagatjit Singh and Sir Thomas Lipton.

[citation needed] In 2012, National Geographic Traveler listed Sri Lanka as one of six countries to visit that year.