Red Lobster, the popular seafood restaurant chain, has announced plans to close 23 additional locations as part of its ongoing bankruptcy proceedings.
The company had already closed nearly 100 locations (93, according to court documents) in May that were “deemed to be non-performing because of rent costs and/or financial performance, such that operating those stores was deemed to be financially burdensome to the rest of the company,” according to the company’s initial bankruptcy filings.
Red Lobster has nearly 36,000 employees across more than 530 branches of the casual seafood chain across the United States and Canada. The company, founded in 1968, is headquartered in Orlando, Florida.
According to a motion filed on Aug. 22 in the United States Bankruptcy Court for the Middle District of Florida, Red Lobster Management LLC and its affiliates have sought court approval to reject leases for the 23 locations, which span 14 states.
This decision follows a meticulous review process aimed at value maximization and the reduction of operational losses by closing underperforming stores, according to the filing.
The specific locations slated for closure include:
8900 Golden Valley Road, Golden Valley, Minnesota
555 S. Van Dorn Street, Alexandria, Virginia
925 Hunts Point Avenue, Bronx, New York
4353 Franklin Street, Michigan City, Indiana
1604 N State Route 50, Bourbonnais, Illinois
1521 S. Yuma Palms Parkway, Yuma, Arizona
902 Commons Drive, Geneva, Illinois
709 Independence Boulevard, Virginia Beach, Virginia
5110 N 9th Avenue, Pensacola, Florida
326 Miracle Strip Pkwy S.W., Fort Walton Beach, Florida
1270 Knox Abbott Drive, Cayce, South Carolina
4625 N Sterling Avenue, Peoria, Illinois
6550 Tara Boulevard, Jonesboro, Georgia
4925 N Academy Boulevard, Colorado Springs, Colorado
750 Upper Glen Street, Queensbury, New York
8909 U.S. Highway 19, Port Richey, Florida
304 A Western Boulevard, Jacksonville, North Carolina
8703 Murray Drive, La Mesa, California
8407 W. Markham Street, Little Rock, Arkansas
17227 Southpark Center, Strongsville, Ohio
12515 Elm Creek Boulevard N., Maple Grove, Minnesota
4415 S. Laburnum Avenue, Richmond, Virginia
2381 Maplewood Commons Drive, Maplewood, Missouri
The company, which has been a major player in American casual dining for decades, is currently restructuring under Chapter 11 bankruptcy, a move aimed at stabilizing its finances and ensuring long-term viability, court records show.
These closures are part of the company’s broader efforts to reduce operational losses by exiting underperforming locations, according to the court filings. The company said the decision to vacate these premises by Aug. 31 aims to avoid further rental obligations and help Red Lobster focus on more profitable locations.
The company first filed for Chapter 11 bankruptcy on May 19, prompted by years of declining sales, increased competition, and rising operational costs, which have taken a toll on the chain’s profitability, according to court documents.
Since the bankruptcy filing, Red Lobster has been collaborating with a real estate advisory firm to evaluate its lease agreements and identify properties that continue to be a financial burden. The closures announced in the latest court filing reflect the company’s strategy to streamline operations and cut losses.
The court document highlights that the rejection of these leases is crucial for the company’s restructuring efforts.
“The Debtors have determined that continued performance under the Rejected Leases would constitute an unnecessary drain upon the financial resources of Debtors’ cash,” the company said in its court filing.
In addition to the store closures, the company has sought the court’s permission to abandon any remaining personal property at the vacated locations, including furniture, fixtures, and equipment, as these items are deemed to have “inconsequential value” or are “burdensome to the Debtors’ estates to remove.”
Red Lobster requested the court review the motion at a hearing on Aug. 29.
From The Epoch Times