Playfair's Terrace was constructed under the ownership of local butcher and Alderman Thomas Playfair in the 1870s. Playfair was well known in the mid to late nineteenth century for his supply of meat to the maritime industry and his actions on the Sydney City Council to provide adequate services and improved sanitation throughout inner city residential areas.
The Terraces are constructed on a portion of land granted to early wharfinger and merchant Robert Campbell. While Campbell's land incorporated the subject site he does not appear to have used it, and his operations were focused on the West Circular Quay foreshore.