Red Lobster to close another Ohio restaurant after bankruptcy
COLUMBUS, Ohio (WCMH) -- Red Lobster is rejecting the lease for another Ohio restaurant, adding to the list of locations in the state that court documents say are closing after the company filed for bankruptcy.
The Orlando, Florida-based seafood chain's restaurant at 17227 Southpark Center in Strongsville is one of 23 locations across the nation that will be vacated by Saturday, according to an Aug. 22 bankruptcy court filing. The announcement comes as the chain is preparing to be bought by Fortress Investment Group, a firm that recently gave Red Lobster a $100 million loan and also owns Logan's Roadhouse and J. Alexander's.
"Red Lobster is an iconic brand with a tremendous future. I’m looking forward to working with our team members across North America to reinvigorate the brand," said Damola Adamolekun, the former CEO of P.F. Chang's that Fortress said will oversee Red Lobster once the deal is approved. "Red Lobster’s future is brighter now than ever before -- I cannot wait to get started on our investment plan."
Earlier this summer, Red Lobster also rejected the lease for a restaurant at 1691 Dublin-Granville Road that had already been closed for several months. Still, the Columbus-area eatery was listed in court filings as one location that was to permanently close, along with the following eight Ohio restaurants:
- 3655 Orange Place, Beachwood
- 6500 Miller Lane, Dayton
- 2340 Tiffin Ave., Findlay
- 1422 Reynolds Road, Maumee
- 255 Graff Road SE, New Philadelphia
- 7607 Day Drive, Parma
- 17227 South Park Center, Strongsville
- 4990 Monroe Street, Toledo
Red Lobster did not respond to NBC4's request at the time for comment to clarify when exactly the Dublin-Granville Road location closed or if the shuttering was tied to the company's May bankruptcy filing. In a previous statement, the company's CEO Jonathan Tibus said "restructuring is the best path forward for Red Lobster."
"It allows us to address several financial and operational challenges and emerge stronger and re-focused on our growth," said Tibus. "The support we've received from our lenders and vendors will help ensure that we can complete the sale process quickly and efficiently."
Red Lobster announced on May 19 that the company had filed for Chapter 11 bankruptcy protection and had listed around 100 stores online as closed. The closures spanned more than 25 states including California, Florida, Indiana, Michigan, New York and South Carolina, with kitchen equipment from more than 50 of those locations up for auction.
Adding the new round of closures, the total number of Red Lobsters that have or are shuttering this summer has expanded to about 129 locations. Come Sunday, the chain will run roughly 500 eateries across the nation, a significant decline from the 650 restaurants it was operating just last year.
In the bankruptcy filing, Red Lobster said it has less than $30 million in cash and currently holds an estimated $1 billion to $10 billion in liabilities to more than 100,000 creditors. As part of the filing, Red Lobster had entered into a "stalking horse" agreement, meaning it was already planning to sell its business to another company.
Red Lobster has spent $190.5 million so far this year operating its locations, including more than $64 million dedicated to "underperforming locations," the filing said. The seafood chain also noted its annual guest count has decreased 30% since 2019, with net sales showing "material decline" through the past year, including a $76 million loss in 2023.
A key turning point was the chain's "endless shrimp" deal last year, which allowed patrons to pay $20 for unlimited shrimp and was meant to only be a limited-time promotion. A decision to add the special as a permanent menu item ended up costing the company $11 million.