Since the early 1840s the government started to give out coastal lots by auction. The bidders were merchant firms, and the land was naturally used for commercial purpose. As the city was opened up as a free-trade port, the Central waterfront became the coveted prize of large foreign firms, who scrambled to build docks, warehouses and offices there for efficient logistics. In those days, Central was the base of foreign merchant firms while Sheung Wan that of Chinese firms. To guard their spheres against wave and typhoon and to allow easy anchorage, both kinds of landowner were keen to level the land and revamp the waterfront. Some even started up small-scale reclamation to enlarge usable land area.

At the same time the government constructed Queen’s Road, named after Queen Victoria, along the coastline, east to west from Sai Wan to Wan Chai. All the coastal buildings had their south-facing front doors looking out on Queen’s Road and their north-facing back doors at the waterfront.

On the night of 28 December 1851, a fierce fire broke out in Sheung Wan Lower Bazaar (i.e. Jervois Street today). The blaze spread through today’s Jervois Street, Wellington Street, Queen’s Road Central, Morrison Street and the Sheung Wan waterfront. To stop it from raging Central, the military decided to buffer the firestorm by blowing up a number of houses. In the end of the incident, 450 houses were destroyed, over 200 Chinese went missing, and two British officers were killed.