Palace drink? (3)
I believe the answer is:
gin
This clue is a double definition.
'palace' is the first definition.
(gin palace)
'drink?' is the second definition.
(gin is an alcoholic drink)
(Other definitions for gin that I've seen before include "A short" , "Spirit; cotton machine" , "Liquor flavoured with juniper berries" , "Spirit, aka 'Mother's ruin'" , "Trap for snaring small mammals" .)