PORT ANGELES — A fire transformed a former Marine Drive boat charter-fishing tackle business turned waterfront bar and restaurant into a burned-out hulk early Monday morning.

Castaways Restaurant Lounge, located on Port of Port Angeles property within the Boat Haven parking lot, was unoccupied for about six hours following an NFL playoff gathering Sunday night when the fire was reported at 1:54 a.m., Port Angeles Fire Marshall Mike Sanders said Monday morning.

The ground lease for Castaways expired Monday, a port official said.

Sanders said when firefighters arrived at Marine Drive, the attic was heavily involved. He said they were in defensive mode from the outset, unable to enter the building and forced to drench the structure from the outside.

“The bulk of the fire was out after about three hours,” Sanders said late Monday morning.

There was no initial indication of what caused the fire, Sanders said.

That will be investigated by Sanders, Port Angeles Police Detective Trevor Dropp and Mike Mingee, a fire code technician for the Sequim Fire Department and Clallam County Fire District 3.

The building was assessed at $475,000, more than tripling in value since 2003, according to county Assessor’s Office records that list Martin Gault of 1213 Marine Drive — the address of Castaways — as the owner.

Gault could not be reached Monday for comment.

Port Executive Director Geoff James said Gault holds a $436-a-month land lease for 6,248 square feet on which the building sits. It also includes some parking.

The land lease expired Monday, James said.

“We were about to execute an option on their lease for another five-year option that they indicated they wanted to execute,” James said.

“They are executing options now,” he added.

“Ideally, [today], we’ll get the first day of the new option. We are hopefully going to get hold of them to see if we are going to do the options or not.

“That’s where we stand right now,” James said late Monday afternoon.

James said the original lease was signed in 1987 for Port Angeles Charters and Tackle Co.

The current lease began in 1997 and Gault began subleasing in 2005, James said.

The building was remodeled in 2006, according to the city Department of Community and Economic Development.

Gault took over the lease in 2012, James said.

James said Gault has to carry liability insurance to cover damage to the property, interpreting that to mean fire insurance is required.

“The fire marshal has to do his investigation, and we will reach out to Marty and ask him what are his intentions, if he’s going to use the insurance for the building,” James said.

“If he’s not, then the port would more or less seek for him to remove the building or remnants of the building on the site so we can do something with that parcel.”

An elevated water stream aimed from a ladder truck extinguished the fire, according to a Port Angeles Fire Department press release. The agency responded with eight personnel, the ladder truck, a medic unit and one engine.

Mutual aid from Clallam County Fire District 2 included one engine and four personnel.

Olympic Ambulance responded with two personnel and an ambulance.

The Port Angeles Police Department provided scene and traffic control, including one on duty Tuesday morning.

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Senior Staff Writer Paul Gottlieb can be reached at 360-452-2345, ext. 55650, or at pgottlieb@peninsuladailynews.com.

Castaways Restaurant Lounge on Marine Drive was gutted by an early Monday morning fire. (Paul Gottlieb/Peninsula Daily News)