Peter McNab III was a brother of James and, in 1832, had acquired the northwestern portion of the island from his father. This property contained approximately 120 acres.

The census of 1827 listed Peter III as a Presbyterian farmer with a household consisting of one male and four females. There were also four servants, three male and one female. Two female members of his household would have been his first wife, Rhoda and three year old daughter Ellen. One birth, that of Charles Edward McNab, was recorded in Peter III's household for the year ending October 1, 1827.

Peter McNab III had built a two-story stone house in the early 1830's on property in the northwestern part of the island (Figure 14). He had tried unsuccessfully to sell his property in 1848 by amalgamating it with the lands being sold by his brother, James. Failing this, in 1850 Peter III advertised 100 lots for sale.

Although some may have been purchased, the vast majority remained unsold. Peter III died in 1856 and by 1862 his widow and second wife, Annie, had begun to sell portions of the property. The first to purchase land from Mrs. McNab was the British War Department who initially acquired 10 acres near Ives Cove. In 1865, construction of Fort Ives began on this property.

In 1872, Lewis Kirby purchased the remainder of the Peter McNab III estate, with the exception of the homestead and three acres of surrounding land. Kirby subdivided the property into 49 lots and advertised them for sale. Several lots were purchased but much of the property remained unsold. A few year later the Imperial Government acquired the remainder of the western shore from Kirby for military purposes and in 1899 construction of Fort Hugonin began on the southern tip of this property.

Another purchaser of land from Kirby was Charles Woolnough. Shortly after his purchase of land on McNabs Island, Woolnough established his popular leisure ground there.

Following the death of Annie, ownership of the McNab cottage fell to Ellen McNab, daughter of Peter III. The cottage, which had apparently been damaged by fire some years before, was sold to Matthew Lynch about 1931. Lynch, one of the island's lighthouse keepers, razed the building soon after purchasing it and constructed the "Lynch" house which now stands in its place, just south of the Conrad house. The death of Ellen McNab in 1934 ended the long association between McNabs Island and the McNab family.