It was near here in April 1821 that 40 soldiers and 60 convicts, under the command of Captain Francis Allman, landed from the three ships – Lady Nelson, Prince Regent and Mermaid – that had conveyed them to Port Macquarie from Sydney. Of course, there was no wharf at that time, just a small sandy beach bordering a grassy tree-studded flat.
It was their job to establish the new penal settlement and while most of the convicts would be required for unskilled labour, others, such as carpenters, had been chosen for their skills.
Reports reaching Sydney in June 1821 indicated that good progress was being made, and when Governor Macquarie visited in November that year he commended Captain Allman on his efforts. However, Macquarie also wrote that he was "shocked and mortified” to see his "old friend and acquaintance the Lady Nelson high and dry on the Beach the inside of the Bar.” Having been damaged on her arrival in April the ship had been lying there for more than six months and at the governor’s insistence, repairs were soon underway.
Another thing the governor learned during the course of his visit was the problem of having a harbour separated from the open sea by a sand bar with limited clearance for vessels. Adverse winds or heavy seas often made it difficult, if not impossible, to enter or leave the harbour and Macquarie experienced this first-hand when his departure from Port Macquarie was delayed for several days. The problem continually plagued the port and was the cause of many wrecks.
