There is a new owner for the tavern at 10th and E Pike that used to be The Comet — but it won’t be musician Ian Hill.

UPDATE 11:50 AM: Lost Lake’s ownership is taking over the space and will reopen the bar next year.

There will still be music but its days as a dedicated live music venue are numbered.

“The Comet has been a tavern for the majority of its existence,” new owner Jason Lajeunesse said of the space’s history. “We also remember the days of karaoke and a pool table…”

More details below.

Hill, who has been very public in his pursuit to take over the space and continue its place in Capitol Hill’s live music milieu, told CHS Wednesday he has been informed that the building’s owners have gone with another plan for the bar:

We lost our bid for the Comet today. I just got an email from Stacy Krantz, the building owner’s daughter. The groups that outbid us went far over the top. We had Stacy’s support because of our platform of preserving the Comet and doing the right thing for the people. But doing the right thing this time wasn’t good enough. We put in a very good offer but it just wasn’t enough. The winning group also wished to have their bid remain silent but I do know it well exceeded ours by a long shot. We were the only group to be vocal about our plans with the Comet. Everyone else that went into this bidding war didn’t talk at all about theirs. We fear there is a reason for that. This is unfortunately another case of big money winning out over doing the right thing.

In late October, CHS reported about the growing buzz around new ownership for the Comet which has been closed for weeks after owner Brian Balodis abruptly shut down the venue amid ongoing financial issues.

Where there is a loser, there is a winner — but in this situation, the winning bidder hasn’t come forward publicly, yet. Hill, who has never owned a bar but was backed in his bid by Pike/Pine nightlife investors that CHS has agreed not to identify, says that the partners behind neighboring Lost Lake were also in on the bidding.

CHS has messages out to Lost Lake partners Dave Meinert and Lajeunesse but they’re staying mum. UPDATE: The Lost Lake owners declined to provide details Wednesday night but told CHS an announcement on the new project will be made public shortly. UPDATE x2: The space will be managed as a separate entity from Lost Lake and won’t get a diner-style overhaul. There will be some live music but no regular performances. A press release on the deal is below.

The 24-hour “dive” diner/bar concept Lost Lake debuted in May in the former home a gay sex club on 10th at Pike adjacent the Comet. Meinert, a longtime area nightlife and music entrepreneur who also owns Big Mario’s, successfully transitioned Belltown’s Five Point into a new era of dive/diner service before partnering with frequent collaborator Lajeunesse of Neumos and Capitol Hill Block Party fame and fortune on the Capitol Hill version. The duo are also partnering on a project to transform 15th Ave E’s The Canterbury.

Lost Lake is a CHS advertiser.

In the meantime, the early steps of the permitting process with the DPD indicates that the building has a small construction project planned for the long-empty retail bay that was once lined up to host a “payday lender” chain. It’s not clear at this point if there’s an incoming tenant in a space that at times past was part of the infamous clubs Sugar and then King Cobra or if the work is related to changes underway at the Comet that will more closely connect the space with its new sibling next door.

We’ll also have to learn more about the future of the Comet name. At last report, the previous operator of the bar Balodis was offering the name for sale to potential bidders. UPDATE: We’re told the trade name “Comet Tavern” has not yet been acquired by the partners.

UPDATE: Here’s the formal announcement of the deal —

Jason Lajuenesse and David Meinert signed a lease to take over the Comet Tavern yesterday morning. With additional details to be announced, the owners expect to have the Capitol Hill establishment open by early 2014. The pair, who earlier this year opened Lost Lake Café on 10th St., will be digging deep into the rich history of the Comet Tavern, and honoring its place and purpose as a neighborhood tavern. “We plan to continue to have some live music, but not every night of the week. We will revive much of the Comet’s lost charms, from pool tables, to pinball games, to a karaoke night, while introducing a small food menu for the first time in the Comet’s history.” said Jason Lajeunesse.

UPDATE: In a strange little sidebar to the big news, we’ve also found some more DPD-related activity at the building. The city has issued the business owners with a violation notice for the large banner installed without a permit above 10th and Pike advertising Westland Whiskey. According to city records, a DPD representative has visited the address twice including November 4th when the owners were issued a second violation notice about the banners. Records show the permit application process was started but DPD never issued the paperwork. “Compliance” is due by November 19th after which fines or legal action may take place. We’ve written about similar situations in Pike/Pine as landowners look to squeeze every opportunity out of the busy streets of the neighborhood.