The Silver Beach Hotel on the north shore of Lake Whatcom opened May 30, 1891, with 15 suites ornately finished in redwood.

Lodging at the "charming little hotel" was $3 a day, with a discount for stays of a week or longer. The dining room's "excellent cuisine" was available for private and club dinners, and a wedding breakfast could be arranged for "on short notice."

It was the dream of the hostelry's investors, chiefly Reginald Jones and E.F.G. Carlyon, to develop Silver Beach into a lakeside resort, but panic on the New York stock market in May 1893, followed by a run on banks, sent the economy into a depression.

The downturn closed the hotel, which was swiftly refitted as a sanatorium by the Panter Improved Remedy Co. Through "bi-chloride of gold" treatments, Panter's rehab clinic claimed "safe, sure and painless cure" for people who "habitually indulge liquors, morphine, opium, cocaine and tobacco." A grand opening was held June 8, 1893, but a lack of folks ready to "try the cure and brace up" soon had Panter checking out.

It wasn't until the turn of the century that the hotel was given another chance. In 1901, a dance pavilion was added to the building's east side and remodeling rendered 30 bedrooms from the original 15 suites. However it was the hotel's bar that proved most profitable. With its liquor and cigars a boat ride away, the hotel served as a convenience store for up-lake communities. Some feared it was nothing more than a roadhouse.

In 1906, Clarence Chandler and William Gwynn made the hotel the centerpiece of their new 12-acre amusement park at Silver Beach. Their $100,000 "White City" featured a merry-go-round, Ferris wheel and roller coaster, and operated May to October for nearly a dozen years.

In 1922, the hotel was converted into a bunkhouse for miners employed by Pacific Atomized Fuel Co., which began working a coal seam beneath the building. Coal mining at Silver Beach quickly reached a dead end, leaving the hotel derelict for the six years prior to its demolition in 1930.