In 1941, a new diner opened for business on the site of a former lunchroom in an industrial and commercial area in South Salem.
Nearly 75 years later, the venerable Salem Diner on Loring Avenue still stands, and is about to begin an improbable new chapter as a university property.
Salem State University, whose central campus is across from the diner, recently announced an agreement to purchase the diner through a nonprofit entity for $600,000 from its current owners, G&Z Realty Trust.
George and Zoe Elefteriadis, who are the principals of the trust and have operated the diner for the past 5½ years, closed the business last Wednesday in anticipation of the pending sale. But the closure will apparently be short-lived.
Salem State is pledging to protect the diner — which is listed on the National Register of Historic Places — and plans to operate it as a business, according to Karen Murray Cady, a university spokeswoman. She said it hopes to have the diner reopen as soon as possible.
“We don’t really have an exact plan as to how we are going to utilize the diner, but we are committed to preserving it,” Cady said.
Among the details still to be determined are whether the diner remains on the current site and whether Salem State operates the diner itself or hires an outside manager.
The 50-seat diner, along with its half-acre of land, is being purchased by Salem State University Assistance Corp., a nonprofit that assists the university, in part by purchasing land. The organization will lease the property to Salem State.
Salem State officials said the acquisition of the property is a logical next step for the university in expanding its campus into that area, noting that the site is adjacent to the 3.5-acre former Weir Valves & Controls property on Canal Street that the corporation purchased in 2010.
Salem State is using one of the former Weir buildings to house its information technology office and for other functions. A second building is storing most of the university’s library collection while Salem State constructs its new library, set to open at the end of August.
The long-range future of the property that includes the Weir and Salem Diner sites has yet to be determined, Cady said.
The sale will also enable the university to own “an iconic piece of the historic fabric of Salem,” Cady observed. “It is very unusual for a university to be buying a diner. The potential is that this could be a really interesting step in the history of Salem State University.”
The Salem Diner was built in 1941 by Sterling Diners, of Merrimac, according to the city application that led to the diner’s National Register listing in 1999. It said the diner was one of only 10 remaining Sterling diners in the state, and one of only two in Sterling’s “aerodynamically” styled Streamliner model.
Opened by George F. Sullivan and Frederick J. Doherty, the diner was sold in the 1940s to brothers James and William Kallas of Salem, according to Peter Tsoutsouras, whose late father, Theo, a first cousin of the Kallases, was hired by the diner in 1958 and became its main cook in the early 1960s.
In 1983, James Kallas retired, giving half the business to his son, John, and selling the other half to Theo Tsoutsouras. James Kallas had previously bought out William Kallas’s share. Both brothers are now deceased.
In 1989, John Kallas sold his share of the business to Theo and Peter Tsoutsouras, who together ran the diner until they sold it in 2001. The elder Tsoutsouras died on June 12.
The Kallas family also ran the Bel-Aire Diner on Route 1 in Peabody from 1953 until closing it in 2006.
The Salem Diner went through two owners after the Tsoutsourases before it was acquired by the Elefteriadises in 2008.
Zoe Elefteriadis said she and her husband decided to sell the diner “because we want to retire.”
“It’s bittersweet because we’ve made a lot of friends here. Everybody knows everybody,” she said. “But it’s just another chapter in our lives. Our kids have their own things and they don’t want to deal with this business. It’s a tough business.”
Elefteriadis said she has enjoyed interacting with the diner’s diverse clientele, which included many college students as well as tourists from an array of countries. For many years, a regular at the diner was former Red Sox great Johnny Pesky, who died last August.
“He would come in every day with his group of friends,” said Elefteriadis, who would specially order bread free of gluten and dairy for him. “He loved the people. He would autograph anybody’s ball, whatever they wanted.”
Elefteriadis said she is happy to have the university purchase the diner because “they will preserve it, they will take care of it. . . . It’s in good hands.”
Peter Tsoutsouras is supportive of the sale as long as the university maintains the diner, recalling fondly his years there.
“Salem is a tourist attraction, so people from all over the country would come to the diner and they were amazed to see how well it was preserved. It’s one of a kind. You don’t see many diners around today.”
Ward 7 Councilor Joseph A. O’Keefe Sr., who has been a customer at the diner often over the years, hopes to see it remain.
“It’s got a lot of history,” said O”Keefe, noting, “It has the aura of how things used to be when I was a boy.” He said he has brought his grandsons to the place to show them what a diner is.
“It’s a treasure,” he said.