Red Robin Closes Cary, NC Location Amid Wider Restaurant Shakeup
The burger chain's turnaround plan targets up to 50 closures nationwide, with some locations sold to franchisees.
Red Robin has closed another restaurant, with its Cary, North Carolina, location slated for closure in the coming weeks. This comes as the 57-year-old burger chain continues its restructuring plan, which could lead to the shuttering of up to 50 locations nationwide.
The Cary property was sold for $3.3 million, according to the Triangle Business Journal. This closure is part of Red Robin's "First Choice Plan," a strategy focused on reducing debt, cutting costs, and increasing franchise sales.
Initially, the company had warned that as many as 70 restaurants might close. However, improvements at approximately 20 struggling locations have taken them off the closure list. Red Robin CEO Dave Pace stated during the company's fourth-quarter earnings call that these restaurants have shown improvements and the company is hopeful they can return to system-wide performance levels.
The exact number of remaining potential closures is not yet confirmed, as the company is continuing to assess performance, and the number could decrease further. A Red Robin spokesperson noted that there is no confirmed number of potential closures at this time.
In addition to closures, Red Robin is also selling company-owned restaurants to franchise operators. The chain has recently agreed to sell 86 locations to Op Burgers and Kuber for a combined $72.5 million. An earlier deal involved selling 30 other locations to Evergreen Dining. These transactions are valued at approximately $96 million and are intended to help pay down debt and support the turnaround efforts.
"Strengthening our financial foundation remains a key priority," Pace said in a statement. "Our partnerships with Op Burgers and Kuber introduce experienced operators into the Red Robin system."
The restructuring efforts by Red Robin occur as many casual dining chains face challenges including rising labor costs, inflation, and more cautious consumer spending. Red Robin is not alone in this trend, as other chains like Dairy Queen, Hardee's, and Hooters have also closed numerous locations. Red Robin no longer operates within New York City, though 14 locations remain open in other parts of New York state.