Located between Swanston and Russell streets and extending from Bourke Street to Little Collins Street, Victoria Arcade was built in 1876 based on the design by architect Joseph Reed. With the Bijou Theatre and Gaiety Theatre on either side, Victoria Arcade became a vestibule for these theatres.
In 1890, complaints were received by the City of Melbourne regarding the state of the closets and urinals in Victoria Arcade. According to the City Surveyor and Officer of Health, these public facilities attached to the Palace Hotel had 'no natural ventilation except outward into the Victoria Arcade, or up the stair to the Bijou Theatre'. Indeed a health concern, the closets and urinals were allowed to remain only on condition that a ventilating fan was in continuous operation from morning until midnight. The Council report also urged that water and efficient deodorants be used with greater freedom.