These 10 restaurant chains filed for chapter this yr

Restaurant chapter filings have surged thus far this yr, echoing a broader rise in company bankruptcies throughout sectors.

At the very least 10 restaurant chains, not together with multi-unit franchisees, have filed for chapter in 2024. August alone introduced three Chapter 11 filings from notable eateries. The rise in bankruptcies comes as diners pull again their spending, labor prices hold rising and Covid-era authorities assist disappears.

A number of extra restaurant chains may file for chapter earlier than the tip of the yr. BurgerFi, which additionally owns Anthony’s Coal Fired Pizza & Wings, stated in a regulatory filing in mid-August that there’s “substantial doubt” concerning the firm’s capacity to function. Others, akin to Mod Pizza, have narrowly prevented chapter by means of a last-minute sale.

Eating places will not be the one corporations looking for chapter safety as excessive rates of interest weigh on companies. Chapter 11 filings have climbed 49% this yr as of Aug. 20, in keeping with BankruptcyWatch. Mall retailer Express, nursing residence chain LaVie Care Facilities and Joann Fabrics and Crafts are among the many corporations which have filed for chapter safety this yr.

Listed here are the ten notable restaurant chains that filed for chapter safety in 2024:

Roti

Mediterranean fast-casual chain Roti filed for Chapter 11 chapter safety on Aug. 23. The corporate stated it’s working with its landlords and suppliers to maintain its 22 areas open whereas it searches for a brand new purchaser or buyers.

The corporate started struggling through the Covid-19 pandemic as a result of roughly half its areas have been in downtown enterprise districts, CEO Justin Seamonds stated in an announcement on the time of the chapter submitting. New buyers helped it maintain on, however the latest downturn in shopper spending led to insolvency.

Roti had raised $58 million as of June, in keeping with Pitchbook.

Buca di Beppo

Buca di Beppo declared chapter on Aug. 5. The Italian American chain is conserving 44 of its areas open whereas it restructures, and plans to open one other restaurant, too.

The corporate blamed its monetary difficulties on rising prices and labor challenges, in keeping with court docket filings.

Buca di Beppo was based in 1993 and bought to Planet Hollywood in 2008, following an accounting scandal involving a few of its high executives.

World of Beer

Tavern chain World of Beer filed for chapter safety on Aug. 2. The corporate blamed excessive rates of interest, inflation and a gradual return to pre-pandemic eating habits.

World of Beer plans to restructure and finish leases at underperforming areas by means of chapter.

The corporate was based in 2007, when craft beer recognition was hovering. Lately, craft beer gross sales have fallen as customers broadly drink much less.

Rubio’s

Rubio’s Eating places filed for Chapter 11 chapter safety in June. The fast-casual chain, identified for its fish tacos, had 86 areas on the time throughout California, Nevada and Arizona.

The corporate stated rising meals and utility prices, the shift to hybrid work slicing lunchtime visitors and minimal wage hikes in California put an excessive amount of strain on a few of its eating places.

In April, California raised its minimum wage for fast-food employees at chains with greater than 60 areas to $20 an hour. A number of days earlier than it filed for chapter, Rubio’s closed 48 underperforming eating places in California.

In August, Rubio’s agreed to a sale to an affiliate of TREW Capital, one in all its lenders.

The restaurant firm beforehand filed for Chapter 11 chapter in 2020.

Soften Bar & Grilled

In June, the Cleveland-based chain stated it was struggling to pay its distributors and landlords. It turned to Chapter 11 to save lots of the enterprise.

The corporate, identified for its grilled cheese sandwiches and craft beer choices, was based in 2006. It had 14 areas at its peak, however its footprint had dwindled to 4 eating places by the point of its chapter submitting.

Kuma’s Nook

Kuma Holdings, the dad or mum firm of Kuma’s Nook, filed for chapter safety in June.

The midwestern burger chain opened its first location in 2005, setting itself other than the competitors with its metal- and punk-themed menu objects.

Purple Lobster

Seafood big Purple Lobster filed for bankruptcy protection in Might, citing a “troublesome macroeconomic setting, a bloated and underperforming restaurant footprint, failed or ill-advised strategic initiatives, and elevated competitors.”

One scapegoat for its insolvency was its disastrous “infinite shrimp” promotion in 2023. However a less-obvious perpetrator was a lease-back settlement made below a previous proprietor that made Purple Lobster’s leases too costly, particularly as gross sales fell.

On Tuesday, the funding group shopping for Purple Lobster tapped former P.F. Chang’s CEO Damola Adamolekun as the corporate’s subsequent chief if it exits Chapter 11 efficiently.

Tijuana Flats

In April, Tijuana Flats introduced new possession, a Chapter 11 chapter submitting and the closure of 11 eating places in a single press launch.

AUA Personal Fairness Companions bought the fast-casual Tex-Mex chain to Flatheads LLC as a part of the restaurant firm’s restructuring.

The chain was based in 1995.

Sticky’s Finger Joint

Hen-tender chain Sticky’s Finger Joint additionally declared chapter in April. Rising commodity prices, the hangover from the pandemic and authorized bills from a trademark case introduced by rival Sticky Fingers led the corporate to restructure.

Sticky’s was based in 2012. By 2023, it had annual gross sales of $22 million, in keeping with a court docket submitting.

Boxer Ramen

The Portland, Oregon ramen chain filed for Chapter 11 chapter safety in February. In late April, it abruptly closed all 4 of its areas, greater than a decade after the chain’s founding.