The casual restaurant sector has suffered economic problems over the last year, with several dining chains closing multiple locations and filing for bankruptcy.
Most of the chains with financial difficulties have faced huge debt obligations with payments that became a burden to satisfy, as interest rates rose and inflation increased the costs of labor and food products.
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Several restaurant chains needed to file for bankruptcy to reorganize their businesses and restructure debt, and in some cases, sold their assets to satisfy their debt obligations.
Related: Popular arcade restaurant chain files for Chapter 11 bankruptcy
Popular seafood chain Red Lobster filed for bankruptcy in May 2024, closing about 187 restaurants. The dining chain emerged from Chapter 11 in September 2024 and now operates about 478 locations in 44 states, according to its website.
Italian restaurant chain Buca di Beppo filed for Chapter 11 bankruptcy protection on Aug. 4, 2025, to reorganize its business with the support of its lenders. The restaurant chain on Nov. 4 won approval to sell its 44 remaining corporate-owned restaurants to its lender Main Street Capital Corp. for a credit bid of $27 million.
Classic bar and grill chain TGI Fridays had 161 U.S. locations when it filed for Chapter 11 bankruptcy on Nov. 2, 2024, to reorganize. The number further plummeted over the next five months to 85 U.S. locations on April 24.
The company’s location count declined from 550 franchise locations in 55 countries to 461 restaurants in 44 countries.
Restaurant chains file bankruptcy in 2025
Struggling Mexican restaurant chain On The Border Mexican Grill & Cantina had about 120 locations at the beginning of this year and closed or vacated 40 non-performing stores on Feb. 24 because of problems with rent and/or financial performance
On The Border filed for Chapter 11 bankruptcy on March 4, 2025, with plans to sell its assets to its prepetition bridge loan lender. The restaurant chain currently has 60 locations operated by OTB Holding, which is 100% owned by private equity firm Argonne Capital Group’s affiliate Borders Holdings, and 20 others run by franchisees.
Popular restaurant and bar chain Bar Louie filed for Chapter 11 protection on March 26 to reorganize and close locations, facing financial distress.
The Addison, Texas-based “gastrobar” chain’s parent BLH TopCo LLC and four affiliates filed their petition in the U.S. Bankruptcy Court for the District of Delaware, listing $1 million to $10 million in assets and $50 million to $100 million in liabilities.
Bar Louie operates a casual dining restaurant and bar chain known for handcrafted cocktails, appetizers, burgers, and other American cuisine. The chain, which has 48 locations according to its website, had as many as 134 locations before filing for Chapter 11 bankruptcy in January 2020 and closing 38 locations.
Restaurant chain Planta, which offers a 100% plant-based cuisine menu, filed for Chapter 11 bankruptcy.Â
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Restaurant chain Planta files for bankruptcy
And now, the owner of popular national plant-based casual restaurant chain Planta has filed for Chapter 11 bankruptcy protection along with 17 affiliates, seeking to reorganize its business.
Related: Classic auto parts company files for Chapter 11 bankruptcy
Miami Beach-based CHG US Holdings, which operates 18 Planta restaurant locations across the country in cities such as New York, Chicago, and in the Los Angeles area, filed its petition on May 12 in the U.S. Bankruptcy Court for the District of Delaware, listing $50,000 to $100,000 in assets and $10 million to $50 million in liabilities.
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The debtor’s largest unsecured creditors include landlord 8461 Melrose Avenue, owed over $613,000; law firm Saul Ewing Arstein & Lehr LLP, owed over $316,000; landlord 13 W 27 Leasehold LLC, owed over $203,000; landlord Friedman Properties, owed over $180,000; and Baldor Specialty Foods, owed over $176,000.
Funds will be available to pay unsecured creditors after administrative expenses are paid, according to the petition. The debtor is seeking joint administration of all 18 cases.
Related: Another major healthcare company files Chapter 11 bankruptcy
