The small wooden mansion was built in 1815 for cornet A.V. Tolstoy. Initially, the house featured a modest facade typical of Moscow classicism and was likely clad in painted boards with simple moldings. In the 1880s, it was acquired by honorary citizen Mikhail Grachev, who, following the fashion of the time, transformed the facade, making it more ornate and plastered. Abundant stucco, sculptures, and a complex ornamental cornice appeared, while the owner's initials were preserved on the pediment.

The Grachev family founded a factory producing gold, silver, and galvanic products, with an annual turnover of 125 thousand rubles and 87 workers. Since 1892, they became court suppliers. The firm was established in 1866 by Gavriil Grachev, and his sons continued the business: Mikhail, Simeon, and Grigory. Mikhail Gavrilovich Grachev was an appraiser for the Cabinet of His Imperial Majesty since 1892 and received a gold medal on the Stanislav ribbon in 1889. In 1897, he was granted the title of hereditary honorary citizen.

Later, the building on Denezhny Lane, No. 11, housed departments of the Ministry of Foreign Affairs and various state institutions. However, the building retained much of the grand decor created during Grachev's time.