Cliff House Restaurant Closes, Future Uncertain

(Editor’s note: Since the publication of this story in our January print edition of the Richmond Review, the Cliff House sign was removed on Dec. 31 and soon thereafter, the building has been marked with graffiti. We included several press releases issued by the proprietors and the National Park Service below this story.)

By Gui Oliveira

The Cliff House, one of San Francisco’s iconic and enduring landmarks and  eateries, closed on Dec. 31.

The closure is partly due to the National Park Service’s (NPS) failure to reach a long-term contract agreement with the restaurant’s operators. The COVID-19 pandemic, which has forced many restaurants to shut down or adapt to new strict guidelines, was another significant factor for the closure. 

Cliff House sign

Photo by Guy Oliveira.

The Cliff House’s initial 20-year concession contract expired on June 30, 2018. Since then, the NPS negotiated short-term contracts with the restaurant’s operators, rather than agreeing on a long-term extension. The most recent contract expired on the last day of 2020. A one-year extension was offered, but the substantial cost of maintaining the building while closed to customers made that option untenable, according to the most recent proprietors Dan and Mary Hountalas.

A press release put out by the Hountalases explained what precipitated their walking away from the longtime business.

“There is no possibility of doing a sustainable level of business for the foreseeable future,” the statement read. “The National Park Service should have selected an operator on a long-term basis to ensure the continued operation of this national treasure.” 

The closure has resulted in 180 employees losing their jobs.

The Hountalas family has been the proprietors of the Cliff House for more than 47 years. The business goes back 157 years and is a big part of San Francisco’s history. The NPS acquired the property in 1977.

 The NPS also released a statement addressing the Cliff House’s closure.

“The NPS understands the difficult circumstances the coronavirus pandemic created for businesses across the globe,” the release stated. “While we had hoped to continue working with Peanut Wagon, Inc., which operates the Cliff House and Lookout Cafe, we have honored their request to let the existing concession contract expire on Dec. 31, 2020.” 

Ultimately what this means for the City is yet another popular eatery has closed its doors indefinitely. The Cliff House now joins its neighbors Louis’ Restaurant, Seal Rock Restaurant and Kawika’s Ocean Beach Deli on La Playa Street on the list of COVID casualties. All of these neighborhood restaurants were within walking distance of each other and were family-run.

 The Cliff House attempted takeout service in early June, but discontinued the practice after 10 weeks due to what they described as “unbearable losses associated with takeout.” 

The Cliff House has a long history of offering a fine dining experiences for its customers, along with a breathtaking view of the Pacific Ocean from its cliff-side perch right above the waves crashing on the rocks below.

Cliff House courtest photo 12.30.20

Courtesy photo.

The future of the Cliff House remains uncertain insofar as who will take over proprietorship. There is a lengthy process that requires a Request for Qualifications (RFQ) which could take years until a new lease is signed by a future successor. The NPS decided to postpone the process in choosing the next lease holder due to the ongoing pandemic. The property at 1090 Point Lobos Ave. will be boarded up and fenced in for an undetermined amount of time, leaving all maintenance responsibilities to the NPS.

The history of the Cliff House is an epic tale filled with destruction and regeneration. Beginning in the 1860s, the Civil War-era restaurant became a popular destination for tourists. People traveled west along what is now Geary Boulevard to Ocean Beach. 

Adolph Sutro, who made his fortune in silver mining and was once the mayor of San Francisco, purchased the Cliff House in 1883. He transformed it into a popular resort where diners could look down at the sea lions on the rocks below while enjoying a meal. In 1887, a fire destroyed the original wood-frame Cliff House. It was reported that a two-masted sail boat named Parallel ran aground in high winds at a small beach below the restaurant. Parallel was illegally carrying 42 tons of dynamite which exploded and started the conflagration.

Sutro spent approximately $75,000 of his own money to rebuild and reopen the second rendition of the Cliff House in 1896. The elegant Victorian building became a social setting with dining, dancing and entertainment for guests. However, the fate of that Cliff House was yet again to be engulfed in flames in 1907.

According to the NPS, after Sutro’s death in 1898, his daughter Emma Sutro Merritt took over the management of her father’s properties and made plans to construct a third Cliff House in 1909. This time its construction was guarded with fireproof steel-reinforced concrete.

In 1977, the National Park Service acquired the property, which became part of the Golden Gate National Recreation Area.

Cliff House view 2019 mjsd

The view from the Cliff House  provides expansive vistas of the Pacific Ocean, Ocean Beach, the western edges of the Richmond and Sunset districts and Golden Gate Park. Photo by Michael Durand.

Dec. 14 Press Release from Cliff House Proprietors:

NPS Forces the Cliff House to Close Its Doors Permanently

180 Employees Lose Their Jobs

It is with deep regret and heartbreak that we must inform you that The Cliff House will close permanently on Dec. 31, 2020.

Our 20-year concession contract expired on June 30, 2018; by that time, the National Park Service (NPS) should have selected an operator on a long-term basis to ensure the continued operation of this national treasure. Since then, the NPS has issued us one six-month and then two consecutive one-year concession contract extensions rather than proceed in a timely fashion with their responsibility to execute a new long-term contract or lease.

The first step in this process was to issue a Request for Qualifications (RFQ) which they did not do until Aug. 13, 2019 􏰀 more than a year and half after this process should have begun. Since 2018, we have negotiated in good faith with the NPS to continue our long stewardship of this iconic San Francisco landmark including our teaming with another operator which submitted a response to the requested RFQ. Our last extension was executed on Jan. 1, 2020 and expires on Dec. 31, 2020.

As we all know, the unprecedented situation brought on by the COVID-19 Pandemic has decimated the restaurant industry. We have continued to uphold our responsibility throughout 2020 even though we have been unable to operate since March 17. We did attempt to institute takeout service in early June, but after 10 weeks could not continue to sustain the unbearable losses associated with takeout.

It costs tens of thousands of dollars every month to maintain and guard the massive Cliff House building. There really is no excuse to be in this situation. There was no COVID-19 in 2018; one or more upper-echelon leaders within the NPS obviously did not do their jobs, resulting in this sad situation.

The NPS offered us a fourth one-year extension to continue guarding and maintaining their building with all costs to be paid for by us without any compensation whatsoever from the NPS. Unlike the government which is not held accountable for profits and losses, we could not accept the additional extension as there is no possibility of doing a sustainable level of business for the foreseeable future.

We attempted to work with them to find a way to move forward given the challenges everyone continues to face during the pandemic. We waited patiently for a response from the NPS to our inquiries regarding the fate of The Cliff House. We finally received an answer at the late date of Dec. 7, 2020. The decision they provided is as follows:

The first RFQ has expired and will need to be completely redone causing a further delay of what could be years. Given how that went in more normal times we do not expect this to be done in a timely manner.
There will not be an interim successor/partner so the building will be left unoccupied and watched over b􏰂 the NPS at tax􏰃pa􏰂ers’􏰄 e􏰃xpense.

We must remove all personal property in the building including all memorabilia as opposed to being paid for our property by the ultimate successor operator as provided in our contract. There will be no effort to speed up the process for successorship.

We have been the proprietors of the Cliff House for 47 1/2 years and are probably the longest-tenured in the 157- year history. We were in fact operating the Cliff House for four years before it became part of the National Park System. We leased the Cliff House from George Whitney, Jr. in 1973 and the NPS did not purchase it until 1977.

This is certainly not the way to thank us, a local small business owned and operated by native San Franciscans, for taking care of this San Francisco treasure this past year at a significant financial loss. Again, this all could have been prevented by the award of a long-term contract two and half years ago.

It is obvious that the NPS has failed in its stated mission to safeguard natural and cultural resources:

As a result, The Cliff House will be boarded up and fenced in for several years as they once again try to implement their own processes.

Realistically we are looking at two to three years of a closed facility. And if there is insufficient maintenance done to keep it up, re-opening costs will be tremendous. How will The Cliff House look/feel when it eventually re-opens? Will there be some element of local ownership? Will it even be 􏰅The Cliff House?􏰆

All of us here at The Cliff House are outraged at the failure of the NPS to select a new long-term operator in 2018, thereby avoiding all this unnecessary hardship and heartache. In the meantime, a lot of priceless memorabilia will be auctioned off and be gone with the wind. Lost forever and with it an important part of San Francisco history.

We are seeking help in holding the NPS publicly responsible for their failures resulting in the loss of the livelihood of 180 employ􏰂ees and their families, as well as the loss of one of San Francisco’􏰄s treasured landmarks and the financial loss suffered by those of us local folks who did our best to stay true to this legacy.

To show your support you can email the NPS directly at: Laura Joss

Thank You,

Dan and Mary Hountalas, Proprietors since 1973

Breaking News! The End of an Era?

Dec. 30, 2020 

After days of negotiations which appeared to lead to a workable solution for all parties involved, The Cliff House will close permanently tomorrow, Thursday, December 31, 2020. At 11:00 a.m. this morning, December 30, 2020 we were informed by the NPS, in a last-minute change of mind, that they were going back to their original offer, which is financially unfeasible to both Peanut Wagon, Inc. and our potential partner.

An anonymous source has told us that the NPS is considering turning The Cliff House into a Federal office building! We protest this awful turn of events and remind once again that this is in violation of their mission statement:

The Cliff House sign will be taken down at noon on December 31, 2020. The Cliff House will no longer be a restaurant and no longer available for the public to enjoy as it has for the past 157 years.

We invite all interested parties to join us tomorrow to witness the heartbreaking end of the iconic Cliff House, which began in 1863.

Dan and Mary Hountalas Proprietors since 1973

Press Release from the National Park Service. Dec. 30, 2020

We would like to provide an update to reflect the status of the National Park Service contract with the Hountalas family (Peanut Wagon, Inc.) for the operation of the Cliff House.

The NPS understands the difficult circumstances the coronavirus pandemic created for businesses across the globe. The NPS has continued to negotiate in good faith and consider all options within our legal authority to allow Peanut Wagon, Inc. to continue to operate the Cliff House, and the parties have thoroughly discussed and explored those alternatives. As recently as December 30, the NPS offered Peanut Wagon, Inc. a new three-and-a-half-year term to avoid an interruption of services to the public.

Unfortunately, Peanut Wagon, Inc. did not accept this offer, and while we had hoped to continue working with them to operate the Cliff House and Lookout Café, the existing concession contract expires on December 31, 2020. This decision, while disappointing for us too, does not mean the Cliff House building will permanently close. The NPS is committed to maintaining this iconic building.

The NPS has a great appreciation for the Hountalas family and all they and the Cliff House restaurant have meant to San Francisco and San Franciscans over the course of many decades. We will work with Peanut Wagon, Inc. to allow them the time necessary to safeguard and remove their property. We remain committed to providing an exceptional experience for residents and visitors to the Bay Area and look forward to welcoming the public back in the future.

To provide some clarity, we have developed a Frequently Asked Questions page on our website to address some of the questions we have received.

1 reply »

  1. I really loved the Cliff House!!! Will it ever open up as a restaurant again? It would be a shame if it is just a federal building, as this restaurant was the best! Not only was the food great, but the view outside those windows was spectacular!!!


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