The original Lufra Hotel was originally built as a private residence in the 1850s and was of weatherboard construction. It later became a boarding house and then a hotel run by the Nuroo family (and for a time, the Taylor family). Ansett Transport Industries bought the hotel in 1946 and it became part of Pioneer Tourist Hotels, a subsiduary company. Instead of refurbishing the old building, the company built a new hotel which was officially opened by Premier of Tasmania, Robert Cosgrove, on 13 December 1948. It was built primarily for tourists travelling between Hobart and Port Arthur. The old hotel building was destroyed by fire on 6 July 1950.