The construction of the City Theater (now the S. Krushelnytska National Academic Opera and Ballet Theater) was carried out by Ivan Levynsky's architectural and construction firm, based on a design by Professor Zygmunt Gorgolewski.

When the Skarbek privilege, which had allowed theatrical performances to be held at the Stanislav Skarbek Theater since 1842, expired in 1892, the city council appointed a commission to resolve this issue. Soon, the commission issued a verdict on the unsuitability of the existing theater hall and decided on the need to build a new theater building worthy of Lviv. After lengthy discussions, Golukhovsky Square was chosen as the site for the construction, at its intersection with Hetmanskie Valy, on the eastern side of which stood the Skarbek Theater building. The construction of the theater was supposed to change the appearance of the square and improve it.

In 1895, a competition was announced for the best theater building design, which was won by construction advisor and director of the Industrial School, Zygmunt Gorgolewski. I. Levinsky's firm began construction work in mid-1897 and completed it, handing over the theater building with a capacity of 2,000 spectators to the city in October 1900. The construction of the Grand Theater, one of the most beautiful buildings in the city, cost 2,500,000 crowns, or $500,000. With its construction, the square as such ceased to exist—the building completely filled the entire area, the adjacent houses were restored, and the flower beds in front of the theater were landscaped. The theater building was visible from afar, from the beginning of Hetmanski Valy on Mariatska Square, and it closed off the avenue du teatre. The building covered an area of 3,000 square meters.