Nov. 4, 2002, 10:01AM

Satellite Lounge to close its doors

By MICHAEL D. CLARK
Copyright 2002 Houston Chronicle

In June, Dickie Malone, proprietor of the Fabulous Satellite Lounge, celebrated his club's 10th anniversary and shared his hopes for its second decade. That future now has been cut short by about 9 1/2 years.

On Thursday, Malone said that the Satellite Lounge will have its "last call" Jan. 4 following a two-day farewell party with concerts by Bob Schneider.

The Satellite Lounge closing is part of a larger renovation project by Hank Zwirek, owner of Star Pizza and Star Pizza II, who three years ago bought the property at Washington and Heights Boulevard occupied by the Satellite and Rockefeller's, a former night spot now used for private functions.

In April, Zwirek plans to move Star Pizza II from its current location on South Heights Boulevard to the former home of Leo's Mexican Restaurant, a building that shares a parking lot with the Satellite. Zwirek says he doesn't want the pizzeria's patrons to have to compete with clubgoers for parking space.

Malone says the Satellite's future has been in doubt since Zwirek bought the property from Malone's former business partner, Sanford Criner.

"The first thing (Zwirek) said to me is, `You're going to have to go,' " Malone says.

Zwirek confirms that he saw no way for three evening businesses to coexist on the corner.

"I can't have my customers drive by and not approach (Star Pizza II) because the parking lot is full," Zwirek says. "I didn't want to put the Satellite out of business. It's an institution. But I've put too much money into remodeling for that to happen."

Since Zwirek's takeover, the rent has risen from $500 per month to $3,000 per month.

Malone says the raised rent and 40 percent loss in business since the Sept. 11 attacks has made it difficult to stay afloat. Both Zwirek and Malone say that the club is having trouble keeping up with the rent.

On Oct. 7, Malone received a registered letter from Zwirek giving him six months to vacate.

That timeline might have kept the Satellite open until the spring, but Malone decided to close when his liability insurance runs out on Jan. 5. Until then he will work to bring some of his favorites back to the room for one last gig.

Shows already booked for November include Edwin McCain on Nov. 9, Dick Dale on Nov. 10 and Vallejo on Nov. 30.

"It's a major bummer. The Satellite has been in existence for 10 1/2 years," Malone says. "But the closing does free me up for new projects."

In addition to playing in the band the Hulley Gulleys, operating the Houston record label Western Electro Records and producing the new Soulhat record, Malone also hopes to find another home for live bands. He speculated about working with the owners of Rockefeller's to bring an occasional live band there.

Lisa Porter Rhoades, a co-partner in Rockefeller's, says any thought of bringing live music there is very preliminary.

As owner of the site, Zwirek would have to approve any plans.

He says it's probably not going to happen. "I don't think I'd want to have more night business there," Zwerik says. "What I'd really like to see is a day business move into the Satellite."

Kevin Fujii / Chronicle
Dickie Malone, shown outside the Fabulous Satellite Lounge, says the club he started in 1992 will close Jan. 4.