Balaji Vishwanath when appointed as Peshwa, in a gesture of appreciation towards Mahadaji Purandare selected him as chief secretary. Both of them became close friends. Their successors carried the tender ties of friendship into the next generation. The Purandares were granted an open land by the Peshwas to build a house. Thus in 1740, the Purandares built the wada there which cost him Rs. 50,000/- in those days. It was a two storied structure.

Wood is used in more proportion in the entire building. The huge entrance door had an excellent wooden carving at the top where the idol of Ganesh stood planted as an auspicious sign. The spacious main hall had carved columns and roof. The hall looked beautiful with Belgium mirrors fitted, glass painted on the inside, chandeliers and carved wooden furniture. It is believed that the beautiful Mastani gave a dance performance in this wada.