The complex of this manufactory began to take shape in the mid-18th century. The founder of the first large linen factory in the city was collegiate assessor Philipp Fadeevich Ugryumov, who laid its foundation in 1758 by decree of the Manufactory Collegium. Subsequently, the owners of the factory changed multiple times.

In 1849, the factory passed to the Borisovsky brothers, who converted it into a paper-spinning production. At that time, some of the old buildings were dismantled, and in their place, a new four-story stone building was erected. This building has survived to this day and is known as the "Old Factory."

In the late 19th century, the factory changed its profile and became a textile factory after being acquired by the Pereslavl Manufactory Partnership. During the Soviet period, the enterprise was called the "Red Echo" factory and was one of the largest in Pereslavl.

Today, on the site of the ancient city factory, there operates a public joint-stock company "Zalesye," specializing in the production of technical filtered fabrics.