The restaurant sector faced severe distress in 2024 with several major dining chains filing for bankruptcy.
Popular casual chain Red Lobster filed for Chapter 11 in May 2024 with about $300 million in debt, while another iconic chain TGI Friday’s filed for bankruptcy in November 2024 with $150 million in debt.
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Other major chains filing last year included Rubio’s Coastal Grill in June 2024 with $72 million in debt, BurgerFi with over $60 million in debt, and Buca di Beppo in August 2024 with $50 million in debt.
Related: Another popular restaurant chain files for Chapter 11 bankruptcy
So far this year, several small restaurant chains have filed for bankruptcy, such as Los Angeles-based Greenleaf Kitchen & Cocktails and Plano, Texas-based The Biscuit Bar. Some major dining chain franchisees have filed for Chapter 11 bankruptcy as well.Â
A popular casual restaurant chain franchise that features scantily clad women servers filed for Chapter 11 protection but not for financial distress. The dining chain was seeking relief from a pending lawsuit. Â
DMD Ventures, owner of six record-setting Twin Peaks franchise restaurant locations in Florida, filed for Chapter 11 bankruptcy protection on Jan. 6, 2025, for affiliated entities DMD Florida Development 2 and DMD Florida Restaurant Groups C and D that own and operate two separate locations.
Top restaurant bankruptcies in 2024.
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The Davie, Fla.-based franchises are facing a $12-million lawsuit filed by one of its creditors, Florida Restaurant Franchise Group, a commercial real estate development and holding company affiliated with Jafrejo Holdings, Nation’s Restaurant News reported.
All litigation against the DMD Ventures entities is subject to an automatic stay while the bankruptcy cases proceed.
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“We put two of our restaurants under Chapter 11 reorganization protection as it was the best approach to deal with a lawsuit concerning the repayment of our debt we secured over a decade ago to build the two stores,” Jack Flechner, franchise owner of the group, said in a Jan. 11 statement.
“We have been in negotiations for over a year trying to work out something that both parties could agree on but were unable to. Bankruptcy protection allows us to operate business as usual.
“We will continue offering great food and drinks in a fun atmosphere, paying our vendors and suppliers as normal and work through this issue. We look forward to coming out of this in an even better position,” Flechner said.
Hooters of America is working with creditors to restructure its business through bankruptcy court in the coming months, according to people with knowledge of the discussions. Photographer: David Paul Morris/Bloomberg via Getty Images
Hooters planning to file for bankruptcy
Another restaurant chain featuring scantily clad women servers is also considering filing for Chapter 11 bankruptcy protection, but, in this case, it’s because of financial distress.
Related: Formerly bankrupt Mexican chain turns heads with major change
Popular casual dining chain Hooters of America is negotiating with creditors to restructure its debt through a Chapter 11 bankruptcy reorganization in upcoming months, people with knowledge of the discussions told Bloomberg.
Hooters restaurants have struggled financially in the last year. The casual dining chain closed more than 40 locations by mid-2024. In September 2024, the company began talks with advisers and lenders about its $300 million in debt backed by revenue and assets.
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