Before the Pacific war Gordonvale had been a small quiet country town south of Cairns surrounded by sugar cane farms. Most of the men worked at the Mulgrave Central Mill and community life revolved around the mill, the railway and the pubs.

By the end of 1942, the townspeople had experienced troops coming and going, but nothing prepared them for the unexpected arrival of about 3,500 United States (US) Army paratroopers in December of that year, more than doubling the local population. It has been said that their troopship had been bound for another base to the north of Australia, but the strategic situation in the region as Japanese forces continued to hold out, caused a last-minute decision by the US Army to disembark the troops at Cairns.

On 28 November 1942, a week before the paratroopers reached Gordonvale, a detachment of the US Army 2 Station Hospital from Mareeba arrived and set up a 150 bed hospital, taking over the Gordonvale and Commercial Hotels in the town’s business centre. The first patients were admitted on the same day.

The Gordonvale Hotel on the corner of Norman and Cannon Streets was originally named the Nelson Hotel. It had been built before 1900 although the exact date is unknown. Alongside was the Nelson Theatre, a pharmacy and shops including a newsagency, and the Commercial Hotel. The previous buildings on the hotel site, including a boarding house, had been destroyed by fire about 1925 and the Commercial Hotel was constructed soon after by Charlie Butler a prominent businessman in the district.