A landmark family-owned restaurant that might be haunted and has been serving customers in the Hudson Valley for more than half a century has closed its doors.

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Smalley's Inn off Route 52 in Carmel closed for good Wednesday afternoon, according to the Town of Carmel Historical Society. The restaurant was known for its Italian American food, birthday parties, Halloween parties, long history and potentially haunted past.

James J. Smalley opened up a bar called Smalley’s Inn in 1852. It was rebuilt in 1924 after a fire and has been owned by the Porto family since the 1960s.

There are rumors Smally's daughter, Elizabeth Smalley, who died at the age of two is buried under the basement of Smalley's Inn. Leading many to believe Smally's is haunted, according to Classic New York.

The staff has reported hearing ghostly sounds or shadows when in the basement.

"Many say little Elizabeth is still up for a game, and if she thinks you are a friendly person, she may try to engage you with giggles and tugs on your clothing. The ladies room is a popular place to feel like you are not quite alone, though the door is secured, and you only see your own reflection in the mirror," Virginia Repka-Franco wrote in her article about Smally's for Classic New York.

According to HauntedPlaces.org, paranormalists believe Elizabeth's ghost has been haunting customers and staff and mentions one time when every cellphone inside the eatery went off with the caller coming from inside the building.

The current owners of Smalley's Inn say health and finances are forcing them to close, according to NewsSource. However, the legend of Smally's may live on because the restaurant is listed for sale.

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