Red Robin’s First Choice Plan: Shuttering 70 Locations
The 57-year-old gourmet burger chain originally launched its aggressive First Choice Plan in July 2025. Designed alongside its full-year 2024 financial results, the core objective is simple: refranchise profitable regions, cut corporate overhead, and radically reduce outstanding debt.
The strategy has already altered the brand’s footprint:
- 2025 Execution: Red Robin closed 23 underperforming locations as their leases naturally expired, allowing the brand to successfully repay $20.3 million in debt by midyear.
- Financial Impact: These optimization efforts caused the company’s adjusted EBITDA to skyrocket 53% to $69.7 million in 2025.
- Current 2026 Outlook: The chain expects to close roughly 20 additional locations this year as commercial leases wrap up, with up to 27 subsequent closures projected for future years.
Sparing Targeted Locations
The turnaround hasn’t been entirely about reductions. Thanks to rapid operational improvements, Red Robin corporate leadership officially pulled 20 locations off the original closure list. Red Robin CEO Dave Pace stated during an earnings call that these units were spared because the brand successfully restored them to a performance level that matches the rest of the network. The company has kept the specific list of remaining target closures private.
A recent casualty of the plan includes a company-owned location at Crossroads in Cary, N.C. Red Robin sold the real estate to commercial developer Capital Growth Buchalter for $3.3 million, with plans to close the doors permanently in the coming weeks.
Strategic Refranchising and Multi-Unit Asset Sales
To rapidly inject liquidity into its balance sheet, Red Robin has completed a series of massive refranchising agreements. Rather than shutting down these locations, ownership is shifting from the corporate entity to experienced multi-unit operators:
- The Northwest Portfolio: Red Robin finalized the sale of 30 operational units across Washington and western Idaho to Evergreen Dining LLC for $23.5 million. These locations will continue to run seamlessly under the Red Robin flag.
- The Bi-Coastal Portfolio: The company finalized a $62.5 million deal to transfer 69 units across eight distinct states to OP Burgers LLC.
- The Pacific Region: An additional 17 units situated in Oregon and Washington were sold to Kuber Oregon LLC and Kuber Washington LLC for a combined $10 million.
From Sam’s Tavern to 500+ Gourmet Outlets
Red Robin’s legacy dates back to 1940, starting inside a Seattle building originally operating as Sam’s Tavern. The modern corporate era officially began in 1969 when restaurateur Gerry Kingen acquired the property, dropped the original name, and laid the foundations for the current casual dining empire. Today, Red Robin operates more than 500 locations across the United States and Canada, though the vast majority remain company-owned as it navigates its current refranchising push.
The 2026 Casual Dining Crisis: Bankruptcies and Liquidations
While Red Robin uses refranchising and lease management to stabilize its capital structure, competing casual dining brands have faced far harsher market realities. Rising operational inflation and shifting consumer spending habits have triggered sudden liquidations across the industry.
| Restaurant Chain | Current Brand Status | Corporate Action Taken |
| Red Robin | Operational / Restructuring | Closing up to 70 underperforming units; massive shift to franchise models. |
| Smokey Bones (FAT Brands) | Defunct | Parent company filed Chapter 11 on Jan 26, 2026; all remaining units closed by April. |
| On The Border (OTB Hospitality) | Defunct (Company-Owned) | Filed Chapter 11 in March 2025; shifted to Chapter 7 liquidation on June 19, 2026. |
The Collapse of Smokey Bones and On The Border
FAT Brands Inc. filed for Chapter 11 bankruptcy protection early in the year. While initial plans focused on converting underperforming Smokey Bones units into its growing Twin Peaks brand, market pressures intensified. By late April, the parent company confirmed that every remaining Smokey Bones restaurant had permanently ceased operations.
Simultaneously, On The Border Mexican Grill & Cantina suffered a complete operational collapse. After filing for Chapter 11 in March 2025, the brand was briefly rescued by Pappas Restaurants in May. However, the corporate turnaround proved unsustainable. OTB Hospitality shut down all company-owned locations in early June 2026, followed by a voluntary Chapter 7 liquidation filing on June 19. While independent franchise locations in select states and South Korea continue to operate autonomously, the corporate core has completely wound down.
Red Robin restaurant closures। First Choice Plan, restaurant debt reduction strategy, casual dining bankruptcies 2026, On The Border liquidation, Smokey Bones closing.
