In 1849, when the Hudson's Bay Company moved their headquarters to Fort Victoria, four tracts of land outside the fort were established for farming purposes. These farms were developed by the Puget's Sound Agricultural Company which had the same officers as the HBC. Craigflower, the largest with 900 acres, was named after a farm in Scotland owned by Andrew Colvile, Governor of the Company.
The bailiff of Craigflower, Kenneth McKenzie, brought a group of settlers from Scotland in 1853 and by 1854 twenty-one houses were built for them on the farm. In 1856, the manor house was finished. McKenzie lived there with his wife and eight children for 13 years. Farm buildings included a sawmill, flour mill, bakery, slaughter house, blacksmith, ships chandlery and a lime kiln. Along with the best breeds of imported stock, the farm produced milk, butter, eggs, meat, fruit, grain and vegetables to feed the residents of Fort Victoria and the crews of ships which put into Esquimalt Harbour. The farm's produce was also used by the company to help fulfil a contract with the Russian American Company in Alaska.
By 1860, the farms had become less profitable and were gradually leased or sub-divided by the Company. Kenneth McKenzie gave up his position as bailiff and moved to his own property called Lakehill Farm in 1866. McKenzie died in 1874 at Lakehill and is buried in Victoria's Ross Bay Cemetery.