The COVID-19 pandemic has done irrevocable harm to the restaurant industry. According to a Sept. 2020 report from the National Restaurant Association, just six months into COVID-related shutdowns, approximately 100,000 restaurants had closed either temporarily or permanently, and close to 3 million restaurant workers were out of work. Unfortunately, a year in, things aren't looking much better for many restaurants. Now, the parent company of multiple buffet chains and one sit-down restaurant chain has filed for bankruptcy. Read on to find out if an eatery near you could be closing its doors in the near future. And for more restaurants that may be disappearing, This Beloved Local Burger Chain Just Filed for Bankruptcy.
On April 20, Fresh Acquisitions, LLC filed for Chapter 11 bankruptcy protection in Dallas, Texas. Fresh Acquisitions is the parent company of some of the most recognizable—and beloved—buffet restaurants in the U.S., including Furr's Fresh Buffet, Hometown Buffet, Old Country Buffet, Country Buffet, Fire Mountain, and Ryan's, as well as sit-down restaurant Tahoe Joe's Famous Steakhouse.
According to the company's bankruptcy filing, prior to COVID, Fresh Acquisitions operated approximately 90 restaurants in 27 states. As of the bankruptcy filing date, that number had dwindled to 71. The company had also "ceased operations in 57 such locations and surrendered possession of the premises to the applicable landlords," citing operating costs of $1.2 million per month for rental space for the 71 restaurants it once operated. And for the latest bankruptcy news delivered straight to your inbox, sign up for our daily newsletter.
Jason Kemp, the co-founder and CEO of VitaNova Brands, the operator of numerous restaurant brands including those under the Fresh Acquisitions, LLC umbrella since January, cited pandemic-related challenges as the primary reason behind the bankruptcy filing.
"As with almost every one of our peers, buffet restaurants took the brunt of the loss of sales during the pandemic and as such, the path to success requires hard choices to be made, including the rationalization of our overall footprint," Kemp said in a statement.
In addition to high rental costs, Fresh Acquisitions owes deliverables on more than $2.47 million in outstanding gift cards, between $3,500 and $4,500 a week to third-party delivery providers, and between $2,500 and $4,500 in weekly processing fees. And for another restaurant that's in trouble, check out This Iconic Mexican Restaurant Just Filed for Bankruptcy.
While neither Fresh Acquisitions nor VitaNova Brands has yet announced which, if any, of the companies' restaurants will close in the future, VitaNova said that it would be focusing its efforts going forward on two of its properties in particular.
"We are looking forward to emerging from bankruptcy as a stronger operator with a focus on the Tahoe Joe's and Furr's," Kemp said in a statement. "These great brands serving great food will create a platform for future growth." The company had already shuttered all but six of its Tahoe Joe's locations prior to the bankruptcy filing, Restaurant Business reports. And for another beloved eatery struggling amid the pandemic, This Fun Chain Restaurant Just Filed for Bankruptcy.
This isn't the first time the restaurants under the Fresh Acquisitions umbrella have struggled in recent years. According to Restaurant Business, the April 20 Chapter 11 filing marks the fifth time the chains have filed for bankruptcy.
In June, Fresh Acquisitions' former owner, FMP Management, also filed for Chapter 11 bankruptcy protection and shut down its operations, citing $13.5 million in debt as part of the impetus for its bankruptcy filing. And for more chains hit hard by COVID, This Popular Pizza Chain Just Filed for Bankruptcy.
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