In a case of winning the battle but losing the war, Jerusalem's beleaguered homosexual community won a series of high profile court victories in recent years permitting its controversial gay pride celebrations - but this week the capital's only alternative gender-orientation bar closed, apparently due to financial problems. Shushan Pub, located on a gritty street of the same name tucked away behind Kikar Safra and the Jaffa Road post office, was as much a political statement as it was a business. But co-owner Saar Netanel notes, "Ideology does not pay the rent." Operating the bar six nights a week was physically exhausting, he adds. "It was a kind of home for many people," he says, a unique locale where where haredim, Palestinians, and religious and secular Jews mixed. "When they left Shushan, each returned to his own ghetto," he laments. "Even straight people came. I could see the fear on their faces the first time they entered." Netanel, 36, opened the nightclub in 2003, the same year he was elected to the Jerusalem City Council as the No. 2 candidate on the Meretz list. He became the first openly gay man to serve as a city councillor in Israel. (In 1998 Michal Eden became the first lesbian elected to the Tel Aviv-Jaffa Municipality.) In an indication of the animosity the tiny gay and lesbian community faces in tradition-bound Jerusalem, arsonists attempted to torch Shushan two years ago. Every year, with the approach of the capital's gay pride parade, extra police patrols were assigned to guard the bar's patrons. Jewish, Muslim and Christian leaders - including evangelical Christian leaders abroad - decried what they called the desecration of the holy city and urged authorities not to permit the celebration. Adam Rousseau, 21, who was stabbed by a haredi man during the 2005 gay parade along Jaffa Road, went to Shushan last weekend for a final toast. "I met my partner at Shushan," he says. "Shushan is a warm, safe and friendly haven. The Jerusalem [gay and lesbian] community was surrounded on all sides by hatred, venom and vitriol, and Shushan was the only place where the community could find comfort." Apart from its sense of political mission, Shushan was also an incubator for Israeli drag artists: Kiara Duple, Talula Bonet, Gallina Port Des Bra, Diva D and The Four Jerusalem Drag Queens all got their start there at the Monday night open stage. Some have gone on to perform in more liberal Tel Aviv. Netanel says he is aware of negotiations to open a new gay bar in the city.