- December 15, 2025
A rendering of a proposed new sign for Funky Pelican. Image from Flagler Beach meeting documents
A rendering of a proposed new sign for Funky Pelican's roof. Image from Flagler Beach meeting documents
A rendering of the proposed new paint and design for Funky Pelican. Image from Flagler Beach meeting documents
The Flagler Beach City Commission has tentatively agreed to a lease change with the Funky Pelican that could mean the restaurant remains in place until 2057.
The amendment to the lease adds four, five-year renewal opportunities, presuming the Funky Pelican completes several proposed capital improvements to the restaurant. While several commissioners expressed some hesitance to lock into a lease agreement for that length of time, the extension was approved 4-0 on Dec. 11, with Commissioner Scott Spradley absent from the meeting.
“My suspicion as to why they're asking to lock in those terms, to a certain extent, is because of the investment they're putting into the property,” City Attorney Drew Smith said.
Funky Pelican’s owner Ray Barshay has applied for building permits to make multiple improvements to the restaurant, to match the upgrades to the boardwalk and pier. The improvements include a new roof over the deck on the restaurant’s east side, fresh paint, creating a mural "photo-op" wall, adding a three-foot wall to the roof to hide the air conditioner equipment and updating the front and roof signage.
The iconic Funky Pelican chalkboard would remain.
“I think this restaurant has a proven record of success with the city and the operator. Its an iconic location with the A-frame right beside it. And we want to ensure its getting the treatment it deserves” said Funky Pelican’s attorney Jessica Gow, with the Cobb Cole law firm at One Daytona.
The original lease approved in 2011 was a 10-year lease with three five-year renewal options. If renewed every time, the lease would expire in 2037. In order to undertake these improvements, the owner is proposing to add four more five-year extensions opportunities to the lease. If all the extensions were approved and used, that would add 20 years to the original 2037 expiration.
The four extensions would only be applicable if the owner completes the capital improvements, according to the lease. Barshay said they’re still working through the engineering details.
The original rent was $3,000 a month with an annual 3% increase – Funky Pelican now pays $4,152.75 and will increase to $4,277.33 in 2026.
Compensation to the city also included a percentage of Funky Pelican’s gross sales over $1 million, which started off as 2% and is now 3% of Funky Pelican’s gross sales over the cap. In 2025 alone, as of October, Funky Pelican has paid Flagler Beach over $76,000 in sales over $1 million, according to commission meeting documents.
The Funky Pelican is not proposing any changes to the rent or sales payment, Gow said. Additionally, she said, the tenant would be responsible for maintenance and insurance of the improvements.
Commissioner Eric Cooley had concerns about locking into a lease that could potentially leave the city with a tenant paying a rent that is lower than what may be fair. There needs to be a way for the city to potentially negotiate terms, he said.
Cooley asked both Smith and Gow to work together to add verbiage to allow negotiations on the terms periodically through the lease.
“We can't predict the future economically,” he said. “So we have to have something in there to just make sure that we don't lock ourselves in as something that potentially could be abnormally low, and yet we're stuck with it.”
Barshay agreed to that, presuming that they could also possibly negotiate the rent going down. The commission agreed.
“I'm only looking at a safety net so both parties have something that's fair,“ Cooley said.
Beyond the time frame of the lease, the changes to the roof sign were the only other cause for concern for the commissioners was the height of the roof sign. The current sign was grandfathered into the city’s height restrictions, but no expansions are allowed.
The new proposed sign, which would read “Eat here,” is 43 inches tall, according to the meeting documents, and the existing sign is 36 inches tall. The Funky Pelican team said they would review the size of the signage between the Dec. 11 meeting and the second reading of the ordinance.
