The Water Merchants, also called the Hub Water Tower, is the home of the Water Merchants, an organization specializing in the acquisition, transport, and sale of potable water, one of the Wasteland's most valuable commodities. For a price, water can be bought to slake the thirst of one person or one thousand; the only difference to the merchants is the cost. In order to maintain such a massive commercial entity, the Water Merchants came to dominate the entire southern section of the Hub, repurposing existing infrastructure and carting in still more to support their endeavors.
The Home Office
The Water Merchant section of town is given over almost completely to the water storage and refining equipment that keeps the Water Merchants in business. A massive water tower dominates this section of town, with pipes and holding cisterns taking up still more room. Flanking this massive operation are two large buildings: the home offices of the Water Merchants.
Doing business with the Merchants is not difficult. They have few qualms and care little about political or humanitarian issues; their only concern is the coin involved. As long as a prospective buyer has the funds available, the Merchants deliver water. Predictably, as clean water is extraordinarily valuable, the Merchants could afford to charge exorbitant prices. However, aspiring thieves would likely be disappointed; despite the plethora of weapons guarding the Water Merchants' section of town, little of value was stored in the home offices.
Children of the Cathedral Hospital
A hospital for the Children of the Cathedral can be found here. High Priestess Jain can also be found here, where you can either piss her off, preach, or assassinate her for the quest from Decker. A few other people from the Children of the Cathedral can also be found here, such as Thorndyke, who can heal you for free. You can also talk to some people outside to find that they doubt the religion, and believe it will die out. 
Involvement with the Vault Dweller
With the vault rapidly running out of water, a possible, but temporary, solution to Vault 13's plight is the hiring of the Water Merchants by the Vault Dweller. However, the Vault's secrecy is its greatest defense; with its location disclosed, hostile forces could locate the sanctuary far more easily. While the inglorious death by dehydration could be staved off for a considerable length of time, a far more violent demise would step that much closer. The in-game effect of this is an additional 100 days in which to complete the quest.
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Water Merchants (location) appears only in Fallout.
- Fallout Official Survival Guide p.75 : "Children of the Cathedral Hospital: A COC healing center. Jain can be found here. Location: In the Water Merchants area."
See also The Hub layout p.174-178