Rubio’s Coastal Grill employees took to social media over the weekend, lamenting dozens of Southern California restaurant closures that took them by surprise.
“Former employee after today,” wrote Thesil58 on Reddit. “They legit told us this morning when we showed up for work that today was going to be our last day. No severance, no warning, nada. I’m not sure exactly what locations are going, but it’s a ton of them.”
The Carlsbad-based chain known for its fish tacos said it was closing 48 restaurants in California, blaming the state’s business climate.
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“Making the decision to close a store is never an easy one,” the company said in a statement. “Rubio’s … after a thorough review of its operations and the current business climate, has decided to close 48 underperforming locations in California as of May 31. The closings were brought about by the rising cost of doing business in California. While painful, the store closures are a necessary step in our strategic long-term plan to position Rubio’s for success for years to come.”
Most of the closures (37) were in Southern California, with 11 in Northern California.
The company, which has enlisted the help of the Los Angeles-based crisis management public relations firm Sitrick and Co., declined to provide specifics on which restaurants closed. But a Reddit user came to the rescue, providing a list of the most recent closures:
Rubio’s filed for bankruptcy protection in October 2020, and has been steadily closing restaurants ever since. The company four years ago operated 167 restaurants in Arizona, Nevada and California. Bloomberg reported it defaulted on some of its debt in June that year after pandemic-related shutdowns slammed sales.
That same year, the company permanently closed 26 underperforming stores in California, Arizona, Colorado and Florida.
But the chain was already in trouble, hindered by competition, increased labor costs and an expansion that failed to thrive in new markets, court papers showed.
In April, California launched a new law (Assembly Bill 1228) mandating fast-food chains with more than 60 units nationwide to pay their workers a minimum wage of $20. The law affects restaurants that are part of a national chain offering limited or no table service.
Just a year ago January, the chain was celebrating 40 years in business. Co-founder Ralph Rubio discovered his love for fish tacos after a trip to San Felipe on the Sea of Cortez in Baja California.
“We would camp on the beach, eat fish tacos in town and drink Coronas. And that was my first exposure. It was very much a Baja thing,” he told SCNG’s Fielding Buck last year.
The company this January hired Hilco Real Estate, an advisory firm that’s often used to help companies in bankruptcy shed their assets, especially leases.
Rubio’s said it is keeping open 86 stores in California, Arizona and Nevada.
Bloomberg contributed to this report.
