Red Lobster may need to close over 100 more locations if it cannot negotiate lower rent costs for its buildings, according to court documents.
A Red Lobster restaurant is shown September 13, 2016, in North Miami, Florida. (AP Photo/Wilfredo Lee)
The company reportedly filed for bankruptcy with $300 million in debt, attributing the financial woes to inflation, unsuccessful promotions like the $20 all-you-can-eat shrimp deal, and high rent costs.
Red Lobster’s 22-year-old lease at its iconic Times Square location in New York is reportedly set to double to $2.2 million annually, the New York Post reported.
A Red Lobster restaurant in Times Square in New York is seen on Friday April 30, 2010. (Richard Levine/Corbis via Getty)
The company is trying to keep the long-standing location, but it has only a few weeks to agree to the new lease before it starts on June 30.
Red Lobster in Leesburg, Florida, on May 15, 2023. (Stephen M. Dowell/Orlando Sentinel/Tribune News Service via Getty Images)
Despite a 4 percent increase in foot traffic during the shrimp promotion, it proved unprofitable as many customers came solely for the cheap shrimp.
Even after raising the price to $25 for the endless shellfish deal, the company still suffered significant financial losses.
