Rubio’s Coastal Grill, known for its beloved fish tacos, announced Wednesday it is filing for bankruptcy, citing rising costs in the state.
The restaurant, which started in San Diego, said in a bankruptcy announcement that it has closed 48 “underperforming” locations in California, including 24 in the Los Angeles area.
According to a statement from the company, the chain “has been negatively impacted in recent years by declining in-store traffic due to work-from-home orders still in effect.” The company also cited rising food and energy costs, along with “significant minimum wage increases in California, (which) are putting pressure on some of its locations.”
“Making the decision to close a store is never easy,” the company said in a statement. “While painful, the store closures are a necessary step in our long-term strategic plan to position Rubio’s for success for years to come. The closures were driven by the rising cost of doing business in California.”
Rubio’s said it is entering into a stalking horse purchase agreement to sell the business to an entity created and controlled by the existing lender. The sale transaction is expected to close within 75 days.
Nicholas Rubin, Rubio’s head of restructuring, said: “Rubio’s Coastal Grill is one of the legendary fast-casual chains with a strong and loyal customer following in its communities. Despite the company’s efforts to right-scale the business, the continued challenging economic conditions have negatively impacted its ability to meet debt servicing requirements. The company believes the best path forward for Rubio’s is a court-supervised sale process, which will position the brand for. long-term success to grow and prosper.”
Another 86 locations in California, Arizona and Nevada will continue normal operations.
