A decade later, Ivy decided that it was time to construct a new clubhouse. The club acquired the lot on the south side of Prospect Avenue formerly occupied by the Osborn house lot and broke ground on a new structure in the spring of 1897. Designed by Cope and Stewardson, the architects of the just-completed Blair Tower on the campus, this building would set new standards for eating club architecture.

Walter Cope reportedly modeled Ivy on the Peacock Inn, a 17th-century Gothic building in Derbyshire. (A picture of this inn hangs in Ivy today.) Junius Morgan, Class of 1888 and a former Ivy member, played an important role in Cope and Stewardson; the firm had designed Morgan's house in Princeton and the plan for Ivy would draw on this model as well.

The finished structure marks the first appearance of Gothic architecture on Prospect Avenue, but differs distinctly from the Collegiate Gothic clubs that were to follow (such as Dial and Cloister). Rather, Ivy resembles the structures of the late Elizabethan period.