The Hotel was built originally in 1897 in Waihi, some 120 km’s north of Rotorua, from Kauri timber which was celebrated for its unsurpassed building qualities. It has endured trials and tribulations during its long and eventful history but remains today a prominent showpiece in the very heart of Rotorua.

In the early 1900’s, Waihi was a thriving town, the third largest in New Zealand (after Auckland and Wellington). Waihi is home of the of the Martha Gold Mine, then the richest in the world. Many hotels and public houses sprang up to cater to the demands of the miners and visitors that occupied the town. One of the finest of these establishments was the New Central Hotel, later to become The Prince’s Gate Hotel. Built by Mr E. Morgan, it had 75 bedrooms and very quickly became well known for its superior qualities.

Visiting mine officials enjoyed the excellent hospitality shown by the first proprietors of the hotel, Mr & Mrs M.G. Power. Many distinguished names began to appear in the hotel register and the biggest weddings and social functions were held at the hotel. Due to Waihi being the railhead it was a popular stay over for visitors to the Bay of Plenty who could then travel on to Tauranga by coach. After Mr & Mrs Power left the hotel their daughter Nellie Budd and her husband took over as proprietors. Mrs Budd, a member of the operatic society, had a beautiful voice and would often entertain her guests with her singing. After leaving the hotel Mr Power later became the mayor of Waihi. Sadly, both he and his wife died from the influenza epidemic sweeping through the region in 1918.

In 1906 the hotel was purchased for nearly $9,000 by Mr Moss Davis, father of Sir Ernest Hyam Davis a New Zealand businessman and Mayor of Auckland City from 1935 to 1941. He was also on other Auckland local bodies, philanthropic and sporting organisations.