By Jorge Casuso

July 8, 2026 -- After a year in the works, the City has ended negotiations to lease a restaurant space on the Santa Monica Pier to the California Roadhouse, which promised to bring back live music.

In a statement sent to the Lookout Tuesday, City officials said they "will begin a new process to identify a future operator for the space," which has been vacant since Rusty's Surf Ranch closed its doors in December 2024.

"The City has asked the operator on more than one occasion whether he would proceed on the terms the Council had approved, and the operator declined," the statement said.

The negotiations unraveled after the City Council on April 28 added a last-minute amendment to the lease that insured the "terms of worker recall and retention be consistent" with an ordinance approved by the Council three months earlier.

Roadhouse owner Sean Ahaus had offered to rehire all of Rusty's workers, who lost their jobs after the restaurant that offered live music closed in December 2024 amid a organizing drive by UNITE HERE Local 11.

Ahaus balked at the inclusion of the ordinance, which City staff had advised the Council was approved after the lease was negotiated and did not apply to the vacant space at 256 Santa Monica Pier.

In a June 14 letter to City officials, Ahaus threatened legal action, claiming UNITE HERE had an undue, and illegal, influence in crafting a lease for the City owned property.

Ahaus sent a subsequent letter on June 27, asking City officials "to PLEASE abide by, honor, protect and preserve all employee and employer laws equally."

"We are desperately trying to negotiate a lease with the City of Santa Monica," Ahaus wrote. "The primary thing we are having trouble defining, and perhaps agreeing to, is we are asking the city to officially agree to abide by all State and Federal Employee and Employer laws, equally."

Ahaus also sent a list of 16 lease points he asked City officials to clarify and define. The City did not respond.

In their statement Tuesday, City officials said they had "sought opportunity for the roughly 30 experienced workers displaced when the prior restaurant closed to return to employment at the location."

They noted that the proposed lease also included "a substantial public investment of approximately $725,000 in tenant improvements, building repairs, and waived rent in order to help the concept succeed.

"After publicly agreeing to those terms, the California Roadhouse operator has declined to execute a lease in the weeks that followed," City officials wrote.

"Instead, the operator has repeatedly sought lease changes that would reduce the worker protections sought by the City in a manner inconsistent with the publicly approved lease terms.

"In light of these circumstances, the City has concluded that the parties will be unable to reach agreement, and accordingly, the City will pursue a new use for the space."

City officials noted the space drew more than a hundred inquiries and nine competing proposals, and said they are "confident it will attract an excellent operator."

Ahaus said he is "meeting with counsel and discussing my options."

A recent poll by the hotel union watchdog Eyes on 11 found that 78 percent of the respondents to its monthly Santa Monica Pulse poll supported the Roadhouse in the lease dispute.

The poll, which was sent via text to 1,000 Santa Monica residents on July 2 had a response rate of 11 percent, according to the poll.