48-year-old dining chain closes original location, no bankruptcy

The U.S. casual edifice industry's economical troubles successful 2025 person carried implicit into this year.

The manufacture faced rising labour and merchandise costs driven by inflation, proviso concatenation instability, consumers’ changing attitudes toward eating out, and unsustainable indebtedness obligations that drove edifice chains to adjacent locations and, successful immoderate cases, record for bankruptcy.

One large occupation has been rising labour and nutrient costs, which person risen by 35% implicit the past 5 years from 2019 to 2025, according to the Bureau of Labor Statistics. Rising costs led to higher paper prices, which besides roseate by an mean of 31% from February 2020 to April 2025, based connected Bureau of Labor Statistics data, according to the National Restaurant Association.

Those higher prices person discouraged consumers from eating retired astatine restaurants successful uncertain times, arsenic much companies statesman announcing layoffs successful a assortment of industries.

Last year, edifice chain, On The Border Mexican Grill & Cantina, which had astir 120 locations astatine the opening of 2025, closed oregon vacated 40 non-performing stores connected Feb. 24, 2025, due to the fact that of problems with rent and/or fiscal performance.

On The Border subsequently filed for Chapter 11 bankruptcy on March 4, 2025, with plans to merchantability its assets to its prepetition span indebtedness lender.

Restaurant relation FAT Brands said it planned to adjacent 32 Smokey Bones, Yalla Mediterranean, and Johnny Rockets restaurants this twelvemonth and besides filed for Chapter 11 bankruptcy extortion connected Jan. 26, 2026.

“The Chapter 11 process volition supply america with the accidental to fortify our superior operation to enactment our concepts and guarantee they stay astatine the forefront of their sectors,” FAT Brands CEO Andy Wiederhorn said successful a statement.

“We program to usage this process to link with cardinal stakeholders astir a value-maximizing program and volition enactment prudently to stay steadfast successful upholding and protecting stakeholder interests,” Wiederhorn said.

Also, fashionable casual eating chain Bahama Breeze on Feb. 3, 2026, said it would adjacent 28 of its locations, arsenic the company’s owner, Darden Restaurants Inc., volition permanently adjacent 14 restaurants and person the remaining 14 into different brand.

Not each edifice concatenation that closes locations files for bankruptcy. In immoderate cases, a concatenation volition consolidate locations and not person to record for bankruptcy.

Iconic Louisville, Ky., casual edifice concatenation Bristol Bar & Grille is an illustration of a consolidation, arsenic it said successful a Facebook station that it volition adjacent its archetypal Highlands determination connected Bardstown Road connected March 15, blaming decreased ft postulation and nonaccomplishment of a late-night eating culture.