Pink Lobster is at risk of shutting down 135 extra eating places if the corporate is unable to renegotiate the phrases of its leases, in response to bankruptcy documents filed last week.
The filings checklist 228 rejected leases that the corporate has flagged as money-losing propositions in the event that they proceed with out changes, according to Restaurant Business.
The checklist of rejected leases consists of several of the 93 Red Lobster locations that had been shuttered abruptly on Could 13.
The courtroom filings counsel that round 135 extra Pink Lobster places are at risk of closing, in response to the publication.
The Publish has sought remark from Pink Lobster.
Final week, The Publish reported that Red Lobster was working to keep its Times Square location open.
The seafood chain has just some weeks to renegotiate the phrases of its lease with the owner, which expires on the finish of the month.
SL Inexperienced and RXR, the businesses that personal the property at 5 Instances Sq., are searching for to double the rental earnings it takes in from the restaurant, The Publish reported final week.
If Pink Lobster needs to proceed working in Instances Sq., it must fork over $2.2 million yearly in hire for the three-level, 16,482 square-foot area.
An actual property dealer who selected to not be recognized informed The Publish that Pink Lobster is more likely to be at the moment paying underneath $1 million a 12 months for the nook area at West forty first Avenue and Broadway.
Pink Lobster, which filed for Chapter 11 chapter in Florida on Could 19, is investigating the position its majority proprietor Thai Union performed within the restaurant chain’s “countless shrimp” promotion that prompted $11 million in losses, courtroom paperwork confirmed.
Pink Lobster mentioned the debacle was a part of a sample of mismanagement by the worldwide seafood firm that owns most of its fairness and provides shrimp to its eating places.
Pink Lobster, with about 550 informal eating eating places within the US, had supplied a $20 countless shrimp dish as a limited-time promotion.
Former CEO Paul Kenny made it a everlasting, year-round choice in Could 2023 regardless of “important pushback” from different administration crew members, the paperwork mentioned.
Some Pink Lobster eating places quickly confronted main shrimp shortages. Across the similar time, it eradicated two breaded shrimp suppliers, leaving Thai Union with an unique deal that led to greater prices, present CEO Jonathan Tibus wrote within the submitting.
“Thai Union exercised an outsized affect on the corporate’s shrimp buying,” Tibus wrote. “The Debtors are at the moment investigating the circumstances round these selections.”
Thai Union couldn’t instantly be reached for remark.
Pink Lobster, with $294 million in debt, plans to shut some underperforming eating places and promote the remainder to a bunch of its lenders together with Fortress Funding Group.
Pink Lobster, based mostly in Orlando, Florida, is without doubt one of the world’s largest seafood eating places with 54 shops outdoors america and about 36,000 workers.
It purchases 20% of all North American lobster tails and 16% of all rock lobsters offered worldwide, the paperwork confirmed.
Pink Lobster mentioned its enterprise has suffered from poor administration selections, excessive inflation, unsustainable hire prices, and elevated competitors.
It posted a $76 million internet loss in 2023.
With Publish wires
