During its heyday, the annual New Year's Eve celebration at the Harbor House restaurant in Pete's Harbor always ended in the early morning hours with a continental breakfast to ensure celebrants were sober enough to drive home safely.

"We'd convert the restaurant to a nightclub atmosphere, with a band and there'd be two or three generations of families," said Paula Uccelli, who once owned the restaurant with her late husband Pete Uccelli. "I have a lot of good memories."

That tradition ended a few years before 2002, when new owners Jose and Dunia Rodriguez took over and renamed the place the Waterfront Restaurant. But now the party's really over.

Opened in 1973, the restaurant will close for good Saturday and eventually be demolished to make way for the planned redevelopment of Pete's Harbor. The 14-acre site is slated to become a residential community with 411 apartments, a clubhouse and a swimming pool. The commercial marina there now with its live-aboard tenants will become a private one, to be used only by the new development's residents.

Uccelli declined to discuss objections raised by boat dwellers and other Pete's Harbor fans who have appealed the planning commission's approval of the project to the city council.

"As you know in life, change is hard. I really want the best for my tenants," Uccelli said in a phone interview Wednesday. "But the same for my life also; new beginnings can be so wonderful."

That perspective is also being embraced by the restaurant's current owners, who say they have already struck a deal to move the business downtown.

"We're sad in a way, but we're also excited about the new possibilities of opening another place and starting all over again," Jose Rodriguez said as he sat at a table Wednesday afternoon in the 145-seat, window and wood-paneled restaurant. An announcement about the location of the new restaurant will be made in the coming days, he said.

Customers are having a harder time letting go, Rodriguez said. He and his wife held a closing party on Dec. 16 with the intention of locking the doors the next day, but reservations kept coming in and they found it difficult to turn their regulars away. But the last day for the public to get into the restaurant will be Friday, and the last meal will be served at a banquet scheduled for Saturday, Rodriguez said.

"Most people would like to see this place stay open," he said. "It's a landmark of Redwood City -- the restaurant, but also the whole marina."

Pete's Harbor opened in 1958 and the restaurant opened 15 years later. When Pete Uccelli died in 2005, discussions about selling Pete's Harbor and redeveloping it for housing had already begun.

Nonetheless, tenants and others are fighting to keep the commercial marina. Members of the "Save Pete's Harbor" contingent recently took the battle to the California State Lands Commission, which leases the outer harbor to Uccelli; it was recently revealed that the Uccelli family had not paid rent to the agency for 28 years. At the commission's Dec. 5 meeting, the family's lawyer, Ted Hannig, said they tried to make payments but couldn't get an answer from the state about where to send the money.

Email Bonnie Eslinger at beslinger@dailynewsgroup.com; follow her at twitter.com/bonnieeslinger.