The Hippodrome lasted four years before the French-born entrepreneur, Jules François de Sales Joubert, secured a 30-year lease on the site and commissioned architect Nahum Barnet to design a theatre, business, and accommodation complex.

Named after the then Princess of Wales, wife of the future King Edward VII, the theatre was the largest in the Southern Hemisphere, boasting a capacity of 2,800.

Joubert had spent almost twice his original budget on construction and was unable to obtain the required operating licences for the hotel, bars and cafes of the complex.

Early in 1888, the renowned actor and playwright, Alfred Dampier, leased the theatre and introduced a successful programming and pricing formula.

In 1900, well-known expatriate American theatrical producer, James Cassius Williamson, took over the lease of the theatre and engaged architect William Pitt to supervise renovations.

In 1909, after a private sound test, Dame Nellie Melba, by then an international star, declared that the theatre’s acoustics were "dead" and that she would not perform unless they were altered.

However, the company he had established with Her Majesty's Theatre as its flagship continued to prosper, featuring the operettas of Gilbert and Sullivan as staple farewell into the 1920s.