Cheesecake Factory: Sorry, We Can't Pay Rent Next MonthNewser — Jenn Gidman
If you've lost income due to the coronavirus outbreak and don't think you can make your rent payment for April, Cheesecake Factory can relate. In fact, the restaurant chain knows it can't make rent—and it has informed its landlords across the nation as such.
"Due to these extraordinary events, I am asking for your patience, and frankly, your help," Cheesecake Factory CEO David Overton writes in a March 18 letter seen by Eater, penned to the company's landlords.
Overton notes the chain has been dealt a "tremendous financial blow" from the pandemic, and that neither the Cheesecake Factory nor any of its "affiliated restaurant concepts," including RockSugar and North Italia, will be writing a check April 1.
"While we hope to resume our rent payments as soon as reasonably possible, we simply cannot predict the extent or the duration of the current crisis," Overton writes.
The chain has already shuttered nearly 30 sites, in addition to converting others into takeout and delivery mode only; its stock has dipped by more than 50% in the past month.
Barron's notes that many of the chain's landlords are shopping centers and malls, which themselves have been struggling due to more people shopping online. But "unlike any other recession ... [commercial] landlords will have to share in the pain," a Raymond James analyst tells the publication.
"If they don't, they won't have any tenants." HuffPost, which reports other big chains are closing restaurants by the thousands—Yum Brands, for example, which owns Taco Bell, KFC, and Pizza Hut, says it's shuttering 7,000 locations because of the virus—notes online reaction to this news that paints Cheesecake Factory as inadvertently leading a "revolution." "Cheesecake Factory ... welcome to the movement," one commenter posted.
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This article originally appeared on Newser: Cheesecake Factory: Sorry, We Can't Pay Rent Next Month