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Ventana Grill in Pismo Beach was ordered to close by a San Luis Obispo County judge after a lease dispute between the property and restaurant owners revealed concerns that the popular cliffside venue was at imminent risk of collapsing into the ocean.
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The restaurant and wedding location, located at 2575 Price St., confirmed to The Tribune last week that it would close Sept. 12 — though restaurant workers would not confirm the reason for the abrupt closure.
According to court documents, however, a court order from SLO County Superior Court Judge Craig van Rooyen on Aug. 26 barred The Old Custom House Inc. — which owns Ventana Grill — from “operating, using or otherwise occupying for any purpose the cliffside building.”
The order comes as the property owners claim the bluff and building are not safe for people to be in.
The restaurant owners, however, claim it’s actually an effort to push them from the prominent seaside property to make way for other development.
Ventana restaurant, property owners locked in lease dispute
The order seems to stem from an ongoing dispute between The Old Custom House Inc. and CCC PSC Owner LLC, a Delaware-based limited liability company, that according to the court documents, owns the Ventana Grill and nearby former Shore Cliff Hotel and properties.
The Old Custom House Inc., meanwhile, is the restaurant division of Compass Health in San Luis Obispo County. Beside Ventana Grill, it owns The Custom House and Mr. Rick’s in Avila Beach, and Wooly’s and Oyster Loft in Pismo Beach.
In a complaint filed by The Old Custom House in August 2025, the restaurant group alleged that CCC — which acquired the property in 2023 — breached its existing lease agreement in July 2025 by “repeatedly demanding (Ventana Grill) immediately shut down all operations at the restaurant building.”
In its initial complaint, the restaurant group did not detail CCC’s reasons for demanding an immediate closure, though it did allege the latter had “contrived a false concern in an attempt to justify the termination of the agreement and destroy plaintiff’s business.” The complaint further claimed that CCC’s true intentions were to evict the Ventana Grill so that the property owner could make more money off the restaurant building with a new lease.
The previous lease CCC inherited when it purchased the property was negotiated with then-property owners Martin Hotel Management LLC in 2012 and locked in automatic lease extensions for the restaurant through 2045, according to a copy of the lease shared in the complaint.
In other court filings, though, CCC alleged that Custom House’s lawsuit was a “bad-faith attempt to distract from its flagrant disregard of the safety and lives of patrons and staff while it continues to operate its cliffside restaurant despite multiple warnings from (CCC) about the unsafe conditions of the structural integrity of the building and the coastal bluffs upon which the building sits.”
‘Significant stability issues’ found under Pismo Beach restaurant, property owner says
According to that September 2025 filing, geotechnical experts had identified “significant stability issues” with the bluffs that would make Ventana Grill unsafe to occupy.
CCC claimed it told the restaurant owners of this risk, and they were initially “amenable to ceasing operations at Ventana Grill.”
“Upon learning the repairs that would be necessary to render Ventana Grill safe would take more than six months, however, (The Old Custom House) then objected to any such closure,” the document said.
In August 2025, CCC sent a letter and 10-day notice to the restaurant reiterating its concerns and telling it to cease operations there immediately or risk defaulting on its lease, the document said. It also threatened potential litigation if the restaurant continued to refuse to stop operations.
In response, The Old Custom House “raced to the courthouse” days later and filed its own complaint alleging the safety concerns were a “contrived excuse” to terminate the lease, CCC said.
Why was popular Pismo Beach oceanfront restaurant ordered to close now?
For months, the two entities have been locked in their legal dispute, with CCC saying the property is unsafe to occupy and The Old Custom House claiming the opposite.
On May 15, CCC filed a formal motion for preliminary injunction, asking the court to order a halt to all operations at Ventana Grill due to the safety concerns.
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“Multiple engineers have confirmed that due to numerous documented structural or geological hazards in the restaurant building’s foundation and the coastal bluffs beneath it, a collapse of these coastal bluffs in the form of a toppling event is anticipated and inevitable,” the motion said.
Included with the motion was testimony from those engineers detailing their inspections of the bluff and an inactive fault and fracture zone below the restaurant building.
A declaration filed by Glenn Tofani, senior principal engineer at Applied GeoKinetics LLP detailed a previous collapse along the bluff roughly 300 feet from the building as well as another during the winter of 2023-24 that collapsed a corner of the building’s parking lot.
Tofani also noted “significant cracks in the foundation elements … of the building and in the elevated concrete patio deck” and added that two building supports at the top of the bluff “do not appear to extend into the bedrock — or even below the ground surface — as they have been represented to.”
“My on-site observations further validated my analysis that failure of the bluff beneath the restaurant building is inevitable, rendering the restaurant building unsafe to occupy absent remediation,” he said.
Given these concerns, CCC asked the court to immediately halt all operations at the site.
“(Engineers) cannot predict the specific date the coastal bluffs beneath the Ventana Grill will collapse, whether it will be today, tomorrow or another day,” the motion said. “As such, every day that the Ventana Grill continues to operate is another dangerous and unnecessary gamble with the lives of restaurant patrons and staff.”
The Old Custom House’s legal team, however has maintained that the property is safe to inhabit and this is instead a ploy to kick the restaurant off of the property.
In a declaration filed April 28, attorney Mark B. Connely said his clients were approached by CCC’s counsel in February to discuss a potential settlement agreement.
Negotiations continued through April 13, including writing up a draft memorandum of understanding — but on April 14, the property owners abruptly filed paperwork that once again sought to stop operations at the restaurant, Connely said.
A day later, CCC along with Peregrine Hospitality announced plans to later that year debut the Pacific Point Resort, a combination of Pismo Lighthouse Suites and the Shore Cliff Hotel — the latter of which is located “on the same coastal bluff roughly 200 feet from Ventana Grill’s front door” and shares a parking lot, Connely said.
An Aug. 18 opposition filed by The Old Custom House’s counsel reiterated that CCC’s attempts to stop operations at Ventana Grill were “a guise to unfairly terminate Custom House’s long-term lease of the Ventana Grill restaurant building … ostensibly so as to incorporate it into their expansive ‘Pacific Point Resort’ opening this year.”
“At the very least, there are seriously disputed facts and serious differing expert opinions,” the opposition said. “Therefore, a preliminary injunction in (CCC’s) favor is unwarranted.”
On Aug. 27, Judge van Rooyen granted CCC’s request for a preliminary injunction, ordering The Old Custom House to stop operations at the Pismo Beach restaurant. Van Rooyen did not share reasoning for granting the order at the time.
The preliminary injunction was set to take effect Sept. 18 at 5 p.m. and would remain in effect until the issues were resolved or further court order.
A hearing is scheduled for the case on Oct. 22 at 9 a.m.
Requests for comment from counsel for both The Old Custom House LLC and CCC were not immediately returned Monday.
This story was originally published September 7, 2026 at 1:51 PM with the headline “Cliffside restaurant in Pismo Beach ordered to close over fears it could fall into sea.”
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