Del Taco plans to reopen 17 restaurants in Colorado shuttered earlier this year following the bankruptcy filing of the operator there.
The Mexican fast-food chain said Thursday that it is planning a “phased reopening” of the locations as corporate units. Three locations are already listed as open on the company’s website; the rest of the locations are listed as “temporarily closed.”
One location was owned by a different franchisee there and has remained open. Another location will remain closed.
“We’re grateful for the patience and loyalty of our guests and are thrilled to once again serve the communities that have supported us since 2003,” the company said in an emailed statement. “Updates on specific reopening dates and locations will be shared as they become available.”
The reopening comes months after the stores were closed abruptly following a decision by the lender to the franchisee who owned 18 of the 19 Colorado locations to pull support.
Newport Ventures, the franchisee, filed for bankruptcy last year after Del Taco declared the stores in default over an unpaid, $125,000 development fee on 10 locations that were to be built under its agreement with the franchisor.
The operator had only acquired the restaurants a year earlier. The franchisee in the case said that the stores were profitable and generating income.
But the lender accused the operator of misappropriation of funds and multiple technical defaults on its loan. Del Taco had accused the franchisee of “serious health and safety violations."
The lender pulled support, prompting the chief restructuring officer to close the restaurants.
Del Taco operates about 133 of its 594 locations, giving the company the ability to run the restaurants.
The reopening comes during a crucial time for the chain, which is being sold by parent Jack in the Box—which itself is working on a turnaround.
Del Taco’s same-store sales declined 3.6% last quarter, its fifth straight quarterly decline. “It can thrive,” Jack in the Box CEO Lance Tucker said last month. “It just needs to be in a situation that’s probably not with Jack in the Box.”
Members help make our journalism possible. Become a Restaurant Business member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.