Raleigh: Continuing its plan for a turnaround, Red Robin Gourmet Burgers just closed an additional under-performing restaurant as it continues to try to cut down on debt and bolster operations through franchising expansion. Its restaurant located at Crossroads in Cary, North Carolina, was just sold to local commercial developer Capital Growth Buchalter, based in Birmingham, Alabama, for roughly $3.3 million and will close in the coming weeks.
Red Robin Closings: First Choice Plan Drives Business Overhaul
The closure is part of Red Robin’s First Choice Plan, introduced in July 2025 to strengthen the company’s financial position. The initiative focuses on lowering expenses, reducing debt, and refranchising company-owned restaurants. Earlier this year, the burger chain had identified up to 70 underperforming locations for potential closure as leases expired. However, progress under the restructuring plan has allowed the company to significantly reduce that number. During 2025, Red Robin closed 23 restaurants and repaid more than $20 million in debt. The strategy also delivered stronger financial performance, with earnings before interest, taxes, depreciation and amortisation (EBITDA) rising 53% year over year to nearly $70 million.
Fewer Closures Planned for 2026
The company has removed about 20 restaurants from its original closure list after operational improvements boosted their performance. Red Robin now expects to close around 20 restaurants in 2026 as leases expire. Another seven locations remain under evaluation, although the company says no final decision has been made. CEO Dave Pace said several restaurants previously considered for closure have shown meaningful improvement, giving management confidence they can continue operating successfully.
Company Expands Refranchising Efforts
Alongside the closures, Red Robin has accelerated its refranchising strategy by selling company-owned restaurants to experienced operators. In June, the company sold 69 restaurants across eight states to OP Burgers LLC for $62.5 million, along with 17 restaurants in Oregon and Washington to Kuber, Oregon LLC and Kuber Washington LLC for $10 million.
Earlier in May, Red Robin also sold 30 restaurants in Washington and western Idaho to Evergreen Dining LLC for $23.5 million. Those locations will continue operating under the Red Robin brand, with Evergreen Dining bringing nearly three decades of multi-unit restaurant experience.
Red Robin Closings: Casual Dining Sector Faces Ongoing Challenges
Founded in 1969, Red Robin operates approximately 475 restaurants located throughout the United States and Canada, consisting of about 81 per cent company-owned and the remainder franchised. This restructuring takes place amid ongoing economic headwinds faced by casual diners earlier this year, when FAT Brands decided to permanently close all its Smokey Bones restaurant locations as part of its restructuring; meanwhile, On The Border’s parent company OTB Hospitality declared bankruptcy as well, having shut down all its company-owned locations back in January and filing for Chapter 7 liquidation.
Disclaimer: This article is based on publicly available company announcements, earnings reports, and media reports available at the time of writing. Restaurant closure plans and restructuring initiatives are subject to change, and Red Robin has stated that the final number of potential closures has not yet been confirmed.
