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# Boardwalk business is no day at the beach
- URL: https://www.smdp.com/boardwalk-business-is-no-day-at-the-beach/
- Published: 2002-08-03T15:00:00.000Z
- Updated: 2026-10-23T00:35:09.000Z
- Author: Andrew Fixmer
- Tags: Business, Main St, #archive-import

*Merchants: Rent tends to be lower than private sector*

While merchants at the beach say the kind of business they get is almost entirely dependent on the weather, the amount of rent they pay is not.

Currently the City of Santa Monica leases property on the boardwalk to three tenants: Hot Dog on a Stick, Back on the Beach and Perry’s Cafe. The remainder of the merchants rent from private landlords.

“The city is fairer than the private sector,” said Fred Deni, owner of Back on the Beach and Back on Broadway. “If you look at commercial rentals on Main Street and the Promenade, the rent would be much higher there than what it sounds like they are charging Hot Dog on a Stick.”

The Santa Monica City Council last week approved a new five-year lease with Hot Dog on a Stick that raised the rent on the company’s small Ocean Front Walk stand from $550 a month to $2,200 a month.

"It's where the dream began and it's our only link to our past," said Fredrica Thode, president of HDOS Enterprises. "They can raise the rent all they want, and we'll somehow find a way to stay in that location."

And while the new amount represents a 400 percent increase, local merchants say Hot Dog on a Stick is receiving a good deal from the city. Many beachfront merchants who rent from private landlords agree their rent is much higher than the city’s.

An Oceanview Activewear and Souvenirs manager said the store is charged $7,000 per month for its shop, which is roughly 1,200 square feet in size. Though the shop is almost double the size of the Hot Dog on a Stick stand, its rent is more than triple the hot dog stand’s new amount.

“Our rent is based on a market rate analysis and an appraisal of the facility,” said Elaine Polachek, the city’s open space manager. “We’re not out there trying to charge whatever the market will bear.”

That’s not to say that a tough tourism market spawned by one of the nation’s severest economic downturns coupled with fallout from the 9/11 terrorist attacks have put the city in a charitable mood.

Richard Chacker, owner of Perry’s Pizza, said he pays the city 21.5 percent of his gross receipts or $200,000 to the city, depending on whichever is greater. And the system of collecting rent has added costs because it requires that a cadre of accountants prepare monthly statements for the city. “(City officials) are sensitive most recently to this,” Chacker said. “They realize the excessiveness of it and they try to help where they can, but they are so limited in what they can do because of the bureaucracy.”

Chacker said every five years he must also submit blind bids to keep his lease with the city. For those bids, the family-run business must compete with national corporations for the space.

“The whole thing is unfriendly and extremely stressful,” he said. “We dread it every time it comes up.”

With more than 105 locations throughout the country — mostly in the Midwest and the West — Hot Dog on a Stick has grown into a corporation since starting at the Santa Monica beach location in 1949.

Officials at Hot Dog on a Stick recognized that their company has grown since being founded as a place for exercise enthusiasts from the original Muscle Beach —which was located just south of the Santa Monica Pier before moving to Venice in the 1960s. The company moved its headquarters to Carlsbad — just north of San Diego — almost eight years ago.

Rebecca Rakes, owner of the Mexican Food stand on Ocean Front Walk, said Hot Dog on a Stick hasn’t been a local Mom and Pop store for a long time.

“They are a big outfit now, they can probably use this as a write-off,” she said. “They make money rain or shine.

“We don’t. We get three months of the year and then we have to shut down.”

*Originally published in the Santa Monica Daily Press print edition on August 3, 2002.* [Read the original PDF.](https://s3.us-east-1.amazonaws.com/smdp%5Fbackissues/080302.pdf?ref=smdp.com)