After 27 years at Heritage Harbor in Monterey, the now 32-year-old Fresh Cream Restaurant broke loose from its moorings. After a short sail south, she dropped anchor in the former site of Bully III, a rare Carmel restaurant due to its large size and very casual nature. (Locals still call the place Bully III, though two tenants followed before this latest arrival.)

The idea that a refined operation such as Fresh Cream would occupy the building aroused community interest. There had always been a large room with a U-shaped bar and space for surrounding tables, and since Fresh Cream didn’t have the personality for a giant bar, my guest and I wondered what we’d find in its place on the way to a recent dinner.

I was glad to see that owner Steve Chesney and his wife, Allison, retained the bar, now called “the lounge,” and added a “lounge menu.” Chesney said they made very few changes to the main dining room menu, except that prices are substantially reduced (up to $10 on some entrees) to reflect lower costs of the new location. Well, that’s a big change.

The elegant new 90-seat dining room is a world unto itself – a beautiful staging area to savor the magical “California cuisine with French roots” of Executive Chef Gregory Lizza, as Chesney describes it. It will be reassuring to fans that Lizza, with Fresh Cream for 18 years, and the entire kitchen staff, made the move.

I’ve become an enthusiast of bar dining, and because the lounge is the truly new feature of FC, and large enough to be its own restaurant, it’s the subject of this report. Ms. Chesney designed the room with muted tones that even extend to the artwork. A black granite bar, polished cement floor, fireplace and wine display augment the furnishings for an effect that is modern, yet warm and relaxing.

Unlike most bars, this one is built for comfort. Forty upholstered seats are at high and low tables, and the bar. Tables are loosely arranged in an extravagance of space. And it gets lively. Though only open since Feb. 10, the entire restaurant has been at capacity on weekends.

The wine list contains more than 100 French and California wines. A dozen or so are available by the glass, with selections rotated. The lowest ($9) and the highest ($20) say a lot about FC’s lounge. It covers a range of tastes and budgets – a smart way to go.

There are eight beers on tap and all the premium liquors a modern epicure insists on as a baseline, plus a few boutique and small-batch-type specialties. I was pleased to see a fresh mint julep with Basil Hayden bourbon ($9) on the menu. Just like they make it in Louisville.

The lounge menu lists nine items, priced from $8 for truffle frites to $18 for a Maine lobster roll. It also presents appetizers, soups and salads from the dining room menu, though you can actually order anything from either menu. The dining room menu items are more expensive – $15 for each appetizer, for example – but keep in mind that Lizza delivers on presentation and quality ingredients.

My guest and I shared one of the better deals: a burger with fries for $11. I also ordered a Caesar salad that cost $12. This seemed illogical, but that’s the dual nature of the lounge and dining room menus. In any case, the salad was large and exceptional, with herbed toast, whole anchovy and generous Parmigiano-Reggiano. Equally good for $8, my guest’s local greens salad included goat cheese, cherry tomatoes and a superb balsamic vinaigrette.

Other than a focaccia roll and parsley sprinkled on the fries, the burger is a standard one with tomato, lettuce, red onion. But featuring some affordable dishes is the point, and “standard” for a fine restaurant means well above average. Add cheese or other toppings for $2 each; I will enjoy this burger again.

Three grilled Australian lamb chops on garlic mashed potatoes ($18) were remarkably juicy, plump and tender, with lamb jus reduced into brilliant flavor. In a conversation with Lizza, he waxed knowledgeably about Colorado, New Zealand and Australian lamb. The bottom line: Colorado lamb rivals Australian, but is much more expensive. These are highly recommended.

I asked Chesney to suggest a dish, and his eyes shone with admiration for an appetizer of ahi tuna tartare in lemon olive oil, layered with pineapple relish, wasabi caviar, topped with crispy onions and soy glaze ($15).

“It’s top-grade tuna,” said Chesney. “You won’t get any of that gristle in your teeth.” It was absolutely fabulous.

Most of us are hummus experts since this wonder food has become so commonly available, but FC’s housemade hummus plate isn’t your plastic-tub variety. It’s lovely, with an edible cup made of cucumber slices, plus a side salad of mixed greens, tomatoes and feta, olives and pita for only $10. It’s fresh, flavorful, and will raise your standards.

Desserts are mostly French classics for $10 each. Unfortunately, the closest I got was glimpsing them en route to their final resting places.

Fresh Cream has hit on something really right with the lounge. Hanging out with nice people, enjoying a scrumptious meal, and coming away with a sense of gratitude for all the good living that life on the Monterey Peninsula affords meets my criteria for a great evening. It’s going to be hard to get a seat, come high season.

FRESH CREAM RESTAURANT Dolores and Eighth, Carmel • Open daily at 4:30pm (lounge) and 5:30pm (dining room) • 250-7943 • www.freshcream.com