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American Steakhouse Chain Sizzler Declares Bankruptcy Because of Coronavirus

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The restaurant group, founded in Culver City and based in Orange County, is trying to figure out a path forward through the pandemic

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Sign at Sizzler
Photo credit should read Josh Edelson/AFP via Getty Images

One of Los Angeles’s most storied restaurant franchises, Sizzler, has declared bankruptcy as a result of the ongoing coronavirus pandemic. The company said in a public statement today that the legal filing is “a direct result of the financial impact the COVID-19 pandemic has had on the casual dining sector.”

Per Restaurant Business, the Orange County-based Sizzler currently operates 107 locations, but has been unable to largely keep up with overhead costs during the ongoing pandemic. Much like with the California-founded Souplantation, which closed permanently earlier this year, and the Cheesecake Factory, issues with landlords and high overhead costs have come to crush much of the fast casual food sector.

Large national chains like Sizzler have been devastated nationwide as malls and other gathering areas remain closed, all while their customer base retreats to food delivery apps, local restaurants, and cooking at home. Sales at Sizzler were already declining pre-pandemic, and it remains unclear how many locations will return, if any, following the company’s chapter 11 bankruptcy filing. The company says that it owns 14 restaurant locations outright (the remaining 93 are franchises), and that it will be looking to renegotiate lease terms with landlords at those locations, at least.

In a later statement sent to Eater by reps for Sizzler, the company clarified that its chapter 11 bankruptcy from the company was directed specifically at those 14 corporate-owned locations; the franchise locations, while obviously affected by any bankruptcy from its parent corporation, are not specifically included in the filing. “Sizzler USA expects to reach agreements with a majority of landlords and is confident most of its restaurants will remain open,” they add.

Sizzler has a storied history in Southern California. The restaurant was founded more than 60 years ago in Culver City by Del and Helen Johnson, selling inexpensive steaks and offering a buffet format that appealed to casual diners and families alike. That style of restaurant has become increasingly anachronistic in recent years, and many wonder how the modern buffet restaurant will survive through the pandemic. For now, much like California Pizza Kitchen, Sizzler will enter bankruptcy proceedings in hopes of shrinking its footprint, shoring up losses, renegotiating important business terms, and surviving into a post-COVID-19 world. It certainly won’t be easy.

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