An innovative three-story timber building, using self-centering, post-tensioned timber shear walls as the main horizontal load resisting system and lightweight composite timber-concrete floors, has recently been completed in Nelson, New Zealand. It is expected to be the trailblazer for similar but taller structures to be more widely adopted. Performance based standards require an advanced understanding of building responses and in order to meet the need for in-situ performance data the building has been subjected to forced vibration testing and instrumented for continuous monitoring using a total of about 90 data channels to capture its dynamic and long-term responses. The first part of the paper presents a brief discussion of the existing research on the seismic performance of timber frame buildings and footfall induced floor vibrations. An outline of the building structural system, focusing on the novel design solutions, is then discussed. This is followed by the description of the monitoring system. The paper emphasizes the need for optimal placement of a limited number of sensors and demonstrates how this was achieved for monitoring floor vibrations with the help of the effective independence-driving point residue (EfI-DPR) technique. A novel approach to the EfI-DPR method proposed here uses a combinatorial search algorithm that increases the chances of obtaining the globally optimal solution. Finally, the results from the forced vibration tests conducted on the whole building at different construction stages are reviewed.© (2011) COPYRIGHT Society of Photo-Optical Instrumentation Engineers (SPIE). Downloading of the abstract is permitted for personal use only.