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Yahoo
17-04-2025
- Business
- Yahoo
Burger King franchisee with dozens of Florida locations files for bankruptcy. Are they closing?
A Destin-based Burger King franchisee with 57 Florida and Georgia locations has filed for bankruptcy. Consolidated Burger Holdings filed for Chapter 11 bankruptcy on April 14 in the U.S. Bankruptcy Court for the Northern District of Florida, according to court documents, pleading financial struggles from inflation and the pandemic. The company has restaurants in Tallahassee, West Palm Beach and Naples, and more in Georgia. "Over the past several years, and particularly as a result of the COVID-19 pandemic, the Debtors' business suffered significantly from loss of foot traffic, resulting in declining revenue without proportionate decreases in rental obligations, debt service, and other liabilities," Consolidated Burger says in the filing, which also shows declining sales and increased losses over the last two fiscal years. Consolidated Burger has spent millions of dollars on upgrades, improvements and remodels since acquiring its stores in 2018, according to Restaurant Dive, including new HVAC systems, roofs, parking lots and parking lot lighting upgrades. Burger King's Parent company Restaurant Brands has said it planned to spend about $2.2 billion in its "Reclaim the Flame" plan to revitalize its Burger King restaurants, CNBC reported. An expected 85% to 90% of the 7,000 Burger King restaurants in the U.S. will get the redesign by 2028, according to CNBC. However, Burger King closed nearly 400 stores in 2023 and several large Burger King franchises have already filed for bankruptcy, the "Today" show reported. Many other restaurant chains such as Red Lobster, Hooters, Tijuana Flats, Appleby's, Cracker Barrel, and the parent company of Outback Steakhouse, Bonefish Grill, Carrabba's Italian Grill and Fleming's Prime Steakhouse & Wine Bar, also took a hit during the pandemic and the recent rise in food costs. Consolidated Burger, which listed assets and liabilities each amounting to about $78 million, plans to continue operating its restaurants during the bankruptcy process, but is seeking to sell the company and its assets, the company says in the filing. Consolidated Burger had been seeking a buyer during the seven months prior to the bankruptcy filing. The bankruptcy filing was the largest among Burger King franchise operators in recent years, according to which covers the quick-service restaurant industry. The bankruptcy filing covers Consolidated Burger Holdings LLC, Consolidated Burger A, LLC and Consolidated Burger A, LLC, and in a first-day filing Joseph J. Luzinski, chief restructuring officer, stated that they operate 57 locations, informally grouped into Tallahassee and Southern Georgia, South Florida and the Florida panhandle, with more scattered in other cities. Consolidated Burger Holdings lists 58 locations in Florida alone, with more in Georgia. It is unclear which locations would be affected. The website lists the following: Apalachicola: 421 US-98 Atlantis: 6080 S. Congress Ave. Blountstown: 20407 W. Central Ave. Boca Raton: 175 N. Federal Highway 8175 Glades Road Bonifay: 2024 S. Waukesha St. Boynton Beach: 1521 Boynton Beach Blvd. 1500 SW Eighth St. Chipley: 1698 Main St. Crawfordville: 2185 Crawfordville Highway Crestview: 3210 S Ferdon Blvd. Defuniak Springs: 1303 S. Freeport Road Delray Beach: 1820 S. Federal Highway Destin: 751 US-98 Fort Walton Beach: 201 Mary Esther Cut Off NW 302 Racetrack Road NE Greenacres: 6405 Lantana Road 6495 Lake Worth Road Havana: 703 N. Main St. Lake Park: 9031 Old Dixie Highway Lake Worth Beach: 231 N Dixie Highway 3796 S. Congress Ave. Marianna: 2247 FL-71 4691 US-90 Naples: 2427 Tarpon Bay Blvd. 6650 Collier Blvd. Navarre: 8590 Navarre Parkway Niceville: 297 E John Sims Parkway Panama City: 109 N Tyndall Parkway 1396 W. 15th S. 3218 E. Highway 98 Panama City Beach: 11213 Front Beach Road 17112 Back Beach Road 7100 Coastal Palms Blvd. Port St Joe: 601 Monument Ave. Port St. Lucie: 10855 S U.S. Highway 1 Quincy: District 90, Historic District, 1951 W. Jefferson St. Santa Rosa Beach: 3580 US-98 Shalimar: 1281 Eglin Parkway Tallahassee: 1060 W Tennessee St. 1301 E. Park Ave. 2626 S. Monroe St. 3102 N. Monroe St. 3107 Mahan Drive 3570 Apalachee Parkway 4400 W. Tennessee St. 5020 Capital Circle SW 5500 Thomasville Road West Palm Beach: 815 S. Congress Ave. 1210 N. Dixie Highway 1721 Belvedere Road 1760 S. Military Trail 4175 Okeechobee Blvd. 5501 Corporate Way 6903 Okeechobee Blvd. Wewahitchka: 542 FL-71 This article originally appeared on Tallahassee Democrat: Florida Burger King bankruptcy: Franchisee files Chapter 11
Yahoo
16-04-2025
- Business
- Yahoo
57-unit Burger King operator goes bankrupt
This story was originally published on Restaurant Dive. To receive daily news and insights, subscribe to our free daily Restaurant Dive newsletter. Consolidated Burger Holdings, a Burger King franchisee, filed for Chapter 11 bankruptcy protections on Monday, according to court documents filed with the U.S. Bankruptcy court for the Northern District of Florida. As of Monday, the operator has 57 Burger King locations across Florida and Southern Georgia, Joseph J. Luzinski, chief restructuring officer, said in a first day pleadings document. Of these locations, 53 are traditional restaurants and four are in Walmart stores. Consolidated Burger has faced several industry challenges which, combined with a highly leveraged balance sheet, depleted its liquidity over the last few years. Consolidated Burger isn't the only Burger King franchisee to declare bankruptcy since the pandemic. 2023 was a particularly bad year for BK operators with a handful of large franchisees filing for bankruptcy, including Meridian Restaurants Unlimited, Toms Kings and Premier Kings. Much like these franchisees, Consolidated Burger faced profitability problems since the COVID-19 pandemic that resulted from significant foot traffic and revenue declines without a corresponding drop in rent costs, debt or other liabilities, Luzinski said. 'Additionally, recent increases in costs of shipping and food, decreased availability of labor, and inflation generally have exacerbated the Debtors' cash flow issues,' Luzinski said. 'As a result, although certain of the Restaurants have remained profitable, others have been operating at a loss, resulting in the Debtors' inability to meet their obligations and achieve the financial metrics required under various agreements.' Consolidated Burger was sued by Burger King in 2024, but it is unclear how a settlement reached in September impacted the operator's path toward bankruptcy. On Feb. 20, Burger King declared Consolidated was in default of its franchise agreements. Burger King agreed to exercise forbearance of these defaults. The company entered into Chapter 11 with $179,000 in unrestricted cash and cash equivalents, which is not enough to fund fixed costs. The operator is asking for $1.6 million in debtor-in-possession financing in addition to cash collateral to operate the business during the Chapter 11 sales process, according to Luzinski. Consolidated Burger, which acquired its stores in 2018, has spent millions of dollars on upgrades, improvements and remodels. It installed new HVAC systems, roofs, parking lots and parking lot lighting upgrades across its restaurants. In the next few years, management plans to complete additional remodels, upgrades and improvements, Luzinski said. It's unclear if these remodels are associated with Burger King's current multi-million dollar renovation push, which was undertaken to boost traffic and sales. Consolidated is considered a 'top-tier Burger King franchisee, consistently receiving the highest marks based upon Burger King store metrics,' Luzinski said. But that has not been enough to sustain profitable operations. For fiscal year 2023, the company had sales of $76.6 million and net operating losses of $6.3 million. Financials worsened last year, with sales declining to $67 million and losses growing to $12.5 million. The company said it has about $77.9 million in assets and $77.9 million in liabilities. Recommended Reading A look back at 8 major franchisee bankruptcies in 2023 Sign in to access your portfolio
