Set at the foot of the Alborz mountains, Tehran, once an agricultural enclave characterized by forests and abundant mountain water, developed at the site of a citadel since medieval times. Tehran was first walled during the Safavid era, in the mid-sixteenth century. With the decline of other regional centers, Tehran replaced Shiraz as the capital of the Zand dynasty in the mid-eighteenth century, before being proclaimed the capital of the succeeding Qajar dynasty in 1795. Tehran flourished under Qajar patronage, and the city gained the addition of various gardens and complexes, perhaps the most notable being the Kakh-i Gulistan, or Gulistan Palace.
By the early twentieth century, these walls were subsumed by the continually expanding city, as the population growth reached half a million. From 1870-2/1287-9 AH, Nasir al-Din undertook the city's modernization, extending the city walls, adding decorative towers and twelve new, tiled gates. Inspired by the urban development of Paris under Napoleon III, which al-Din had witnessed personally on a visit abroad in 1873, the new walls were designed with the work of Sebastien Leprestre de Vauban in mind, and the area north of the original city transformed to the likeness of the Boulevard Haussman. New avenues and squares were constructed, among them; Meydan-e Tupkhane (Cannon Square) , Avenue Lalezar (Tulipbed Street), and Ala Od Dwale Under al-Din's direction the city quadrupled in size, and many of the gardens surrounding the city were used for further construction. The Kakh-i Gulistan was rebuilt, and became the centerpiece of the city, with the addition of turreted towers, supervised by Dust 'Ali Khan Nizam al Dawla. Polychrome tiles replaced the painted ornamentation in much of the complex, as did carved stucco and decorative mirror-work. In addition to the Kakh-i Gulistan, summer palaces were constructed in the Shimiranat villages in the city's northern suburbs.
Tehran yet again underwent expansion and modernization efforts in the mid-twentieth century, as the prosperity that accompanied the exploitation of oil from the 1950s accelerated the growth of the city. In 1979, Tehran became a hub for revolutionary activities, aimed at concluding the reign of Shah Mohammad Reza Pahlavi. The city has continued to be a site of development, with over half of Iran's total industry being based in Tehran, and the construction of many research and educational centers.
In terms of programme, the renovation of the Austrian Trade Council required the remodelling of the interior to create flexible spaces for both normal office use and frequent receptions and conventions. In terms of aesthetics, it was considered important to recover the harmony of the original building, which had been much altered over the course of 30 years. To achieve this, a consistent geometrical concept (the language of the cube) was applied throughout, from the floor plans to the furniture and fittings. Design and construction ran in parallel, phased over nine months to allow continuous occupation of the building.