San Diego-based fast casual chain Rubio’s Coastal Grill has announced its filing for reorganization under Chapter 11 of the U.S. Bankruptcy Code. The move comes after the recent closure of 48 locations across California and is aimed at facilitating the sale of the business. With a total of 86 locations in California, Arizona, and Nevada, Rubio’s will continue to operate normally.
According to Chief Restructuring Officer Nicholas Rubin, declining foot traffic due to remote work practices and increasing costs have put pressure on several locations along with significant minimum wage hikes in California. Despite efforts to downsize operations, economic challenges have hindered their ability to meet debt obligations.
In order for Rubio’s brand growth and success in the long term, they believe that a court-supervised sale process is necessary. A stalking horse purchase agreement has been made with an entity controlled by their existing lender while Hilco Corporate Finance will oversee bidding during this process.
The post announcing this development was published on Connect CRE.
