The lease Pug Ryan’s Brewery has for the tiki bar at the Dillon Marina expires in November 2026, and the Dillon Town Council discussed Tuesday, Aug. 26, if it wants to make a request for proposals for a new concessionaire.

Town manager Nathan Johnson said the current agreement, which is the eighth extension of a lease originally signed in 2011, does not allow for a renewal after its expiration Nov. 1, 2026. Johnson wrote in a memo that the tiki bar is “vital to the vibrancy” of Dillon’s lakefront area.

“Clearly this creates a significant portion of revenue back to the town,” Johnson said. “They submit a check to us in the amount of 10% of gross sales.”

The money the town made from the tiki bar increased by 42% from 2023 to 2024, Johnson said, although the bar, its facilities and its concessionaire have had issues over the years.

“We most recently had to put in a hot water heater so that it could pass a public health safety permitting process,” Johnson said. “Luckily, (marina director) Craig (Simpson) and his team were able to do that.”

Johnson said town staff brought the topic before the council early on purpose. The council considered issuing a request for proposals in 2022, he said, but with a more constricted timeline, potential concessionaires did not have time to craft their proposals.

“They needed more time to build out what they needed,” Johnson said. “Maybe they’re gonna buy a food truck, or two, or three … In talking with (Simpson), we wanted to get the ball rolling sooner than later.”

Town staff believes the tiki bar needs upgrades for a concessionaire to be successful in the future, according to Johnson’s memo. Johnson said that what the town does to the bar could depend on what concessionaires submit proposals, though.

Simpson briefly spoke to reinforce the importance of the tiki bar, which he called a “huge center of gravity” for the marina. He said having a bar in that location — not just farther up the hill where the town has discussed building a new restaurant — is beneficial for the marina.

“If we don’t have that tiki bar there, we would be very, very lacking in anything to do down there,” Simpson said. “The hike from the elevation (the marina is) at up to the closest thing to do here is significant for a lot of people.”

Council members talked about what improvements could be made to the tiki bar, bringing up major changes like adding a permanent building and restrooms. Those major improvements would require replacing the seawall near the restaurant, according to Simpson and public works director Scott O’Brien.

“To have the right kind of facility, water and sewer is the first piece,” O’Brien said. “We can’t do that until we stabilize the seawall.”

Council member Oliver Luck said he remembered the cost of the seawall being around $600,000, but town staff responded saying the project will cost closer to $5 million.

“We’re talking quite a bit of funding,” Simpson said. “In the meantime, let’s keep what we have going.”

The council briefly talked about ways the tiki bar could stay open or be temporarily replaced during seawall stabilization, which staff said would happen during the summer. Ideas included putting a bar on a boat and waiting to do the work until a potential restaurant farther up the hill is completed.

Simpson pointed out that Pug Ryan’s owns much of the equipment at the tiki bar, including the furniture and the kitchen. Summit Daily reporting from 2023 stated Pug Ryan’s has around $250,000 worth of equipment at the site. 

Johnson said the town has a list of everything at the tiki bar that Pug Ryan’s owns that would need to be replaced if a different operator takes over. 

“Hopefully with a new provider, we could work with them and hopefully work with some of these other businesses and strike some deals,” Johnson said.

Council member Kyle Hendricks said Pug Ryan’s “has one foot out the door.” Mayor pro tem Joshua Samuel asked if there was interest in having the restaurant continue operating the tiki bar, and Johnson said Pug Ryan’s could respond to the request for proposals if it wants to continue.

Johnson asked the council if it wanted town staff to prepare a request for proposals based on a draft request from 2022, which the town never issued because the council at the time renewed the lease with Pug Ryan’s.

Council members voiced support for that plan, and Johnson said staff would aim to have proposals ready to present to the council in the first quarter of 2026. 

Johnson said the town could work with the chosen operator to determine what improvements are needed, then do that work at the end of the 2026 summer season so the operator is ready to take over in 2027.

“We’re just trying to be very cautious here,” Johnson said. “It is a vibrant part of the marina, and, I would say more importantly, the lakefront, how this intertwines all together, especially with the amphitheater.”

The council directed staff to update the 2022 draft request for proposals and bring it back to a future council meeting for approval.

Pug Ryan’s Owner Chris Locke did not immediately return media requests for an interview.