jack mcgrath immigrated to seattle from england as an infant in the late 1800s. after years of managing cafes and hotels in various locations, mcgrath and his wife merrill moved to north bend. after their first cafe at a different location burned down, he decided to rebuild on a site of two vacant lots that he had purchased. mcgrath's cafe was built in 1922 on washington's first automobile route across the cascade mountains, ideal for providing food for travelers. jack mcgrath added a second-floor hotel in 1926 as auto tourism was increasing, "in time for the early spring travelers". architects for the hotel were b. dudley stuart and arthur wheatley. mcgrath sold the cafe and hotel in 1944; the new owners continued to operate it as the mcgrath cafe and hotel for the next seven years.