Scruffy Murphy's is situated in Melville Place in what is called the New Town. It was part of the third development, the first having begun in 1776 and completed in 1800. The second aimed to extend Edinburgh all the way to the Water of Leith.

Development  continued until 1830, with the noted architect Robert Reid developing the area around Drummond Place and James Gillespie Graham creating Melville Street to Moray Place. Randolph Crescent and Moray Place give the area a more curvaceous look with classical Georgian fronts.

The New Town remains a highly desirable residential area with Princes Street being recognised internationally for retailing, and George Street still retains most of Edinburgh's considerable financial sector.