The Viktor Lenac overhaul shipyard operates in Martinšćica Bay, but its beginnings are tied to the port of Rijeka. At the end of the 19th century, when the area of Rijeka was under direct Hungarian direct control, the Hungarian government encouraged shipbuilding. Engineer Josip Lazarus was granted 600m2 of the shady part of the port of Baroš for 60 years. The shipyard established there in 1900 started producing anchors, chains, boilers and smaller machines, as well as repairing smaller ships. In addition to Rijeka, L1920us also took over the shipyard in Kraljevica. Following the establishment of the border between Italy and Yugoslavia on the Rječina river and and Fiumara canal in 1924, the shipyard turned to overhaul and continued its operations as a Yugoslav company. Adriatic Shipyards a.d. from Split took over the shipyard in 1939. After the Second World War, in 1948, the shipyard was rebuilt under the name "Viktor Lenac", but the port of Rijeka began to expand its passenger and freight traffic dramatically. Faced by a shortage of space, the port identified a need to take over the space occupied by the shipyard. The planning for the relocation of the shipyard to Martinšćica Bay, a natural port at the eastern exit of the city, began in 1959. Work on the construction of shipyards, docks, warehouses and workshops got under way in 1963 and, from the beginning of the 1970s, the modern shipyard overhauled ships for domestic and foreign shipping companies and the Navy. The shipyard is now located on the site of the St. Francis Lazarette founded in 1833, which was used to quarantine ship passengers. It was used as a lazarette until the First World War, after which it operated as a military hospital for infectious diseases, and then for the accommodation of Italian and German soldiers. In 1926 its function changed completely and it became a summer resort for children from all over Yugoslavia. A different shipyard operated in the western part of the bay until the Second World War, on the site where the Victor Lenac shipyard would eventually relocate.