While it has unremarkable modern shopfronts at ground level, the upper floors of the McNess Royal Arcade — Perth's first city shopping mall — still retain their 1890s classical splendour.

"It's what is called Federation Classical and you can see the Greek elements in it — splendid columns with ornate tops, beautiful shell scallops above the windows," Richard Offen from Heritage Perth told 720 ABC Perth.

"It has been redone in as close as possible to the original colours, so we see it as it would have looked in 1897."

The arcade was created by one of Perth's early businessmen, tinsmith Charles McNess, who arrived in Perth from London in 1876 under a scheme to attract small capitalists to the colony.

Charles McNess's original ironmonger shop on Hay Street. ( Supplied: Heritage Perth )

"Charles McNess was one of those who was encouraged to come over and set up business and try and get Perth, which wasn't really having the greatest of economic times, moving," Mr Offen said.

"He managed to lease six plots of land on the corner of Hay and Barrack streets and he erected five galvanised iron shops on the land."

McNess leased four of the shops and kept one for himself, an ironmonger's and tinsmith's store that became known as "McNess's rusty nail shop".

Despite the name, however, the shop thrived, especially during the first gold rush in the 1890s.

"McNess was a very shrewd businessman and I think he realised that a lot of the gold prospectors were going to come through Perth and would need equipment," Mr Offen said.

"He stocked up on sieves and shovels and picks and made a killing."

Little of the arcade's original ground floor facade remains, but the upper floors retain their features. ( 720 ABC Perth: Emma Wynne )

In 1895 a dispute between the owners of the land meant McNess was able to buy the land his shops stood on. He moved his business to Wellington Street and commissioned an architect to design his grand three-storey arcade.

"It took 15 months to build and officially opened on December 23, 1897 by the mayor of Perth, Alexander Forrest," Mr Offen said.

The McNess Royal Arcade on Hay Street, 1953 ( Supplied: State Library of WA )

"It was in fact the first shopping arcade in the centre of Perth. People wanted shopping arcades in those days because of the sun in summer and the cold in winter."

The arcade contained 64 shops, as well as McNess's offices, and made its owner enormously wealthy.

McNess retired in 1919, passing the business on to his only son Herbert, and in the 1920s became known for his philanthropy.

He gave £90,000 to create a housing organisation for needy families and £20,000 to the state government to provide employment through creating a national park at Yanchep, north of Perth.

"In 1932 he was knighted and became Sir Charles McNess, but evidently he didn't spend a lot of money himself because he got the nickname Scruffy McNess," Mr Offen said.

McNess died in 1938 aged 86 but "left us this wonderful legacy of an amazing building", Mr Offen added.

McNess Royal Arcade in 1912 and 2016, with Perth Town Hall looming behind. ( Supplied: State Library of WA and 720 ABC Perth: Emma Wynne )

His son Herbert held onto the property until his death in 1980, and in 1986 the building was sold to the University of Western Australia.

In 1985 it was altered, the double-height arcade space was filled in with shops and a ceiling added.

The ground floors are now occupied by shops and a bank and the upper floors are vacant and used for storage.