A man has been charged with murder after an inner-west cafe owner was shot dead in a late-night ambush.

Bill​ Panagakos​ was shot on March 5, 2014, his 45th birthday, and left in a pool of blood on Railway Street, Petersham, just after 11pm.

His business partner Gazi​ Safarjalani​, who lists his job online as the manager of Mr Panagakos' now-defunct cafe, was arrested on Wednesday night following a three-year investigation.

The 36-year-old did not apply for bail in Burwood Local Court on Thursday.