Why Applebee's Is Getting Evicted From Its Times Square Location
If you're a fan of fast-casual dining, then there's probably a good chance you've paid Applebee's a visit at least once or twice. Its spinach and artichoke dip and the Bourbon Street Steak are arguable triumphs of affordable dining. But, the restaurant chain has received a number of headlines this year, and they haven't all been quite as digestible. In March, after Dine Brands Global, Inc. (which owns Applebee's and IHOP) announced its fourth-quarter and full-year fiscal report, the stock fell by more than 5%, says InvestorsObserver. In August, Applebee's announced plans to sell all 69 of its company-owned restaurants, per Restaurant Business, making Applebee's totally franchised. This wasn't the first time for the chain, either: three years prior, in 2018, Applebee's 1,570 stores were 100% owned by franchisees.
Now, Applebee's Neighborhood Bar + Grill is getting evicted from its Times Square location. per Nation's Restaurant News. The Times Square Applebee's Neighborhood Bar + Grill restaurant is franchised by Apple-Metro Inc., which runs over 30 Applebee locations throughout New York. But, the physical 11,000-square foot space on 42nd Street where Applebee's resides (or, resided) is owned by Madison International Realty, who says it's time for Applebee's to leave. The restaurant hasn't paid rent since June 2019 and now owes $7 million in back rent.
The restaurant had cash flow issues
Per Nation's Restaurant News, the Times Square Applebee's Neighborhood Bar + Grill restaurant was reportedly experiencing "cash flow issues" exacerbated by the pandemic, which caused the restaurant to shutter its doors for over a year (from March 2020 to June 2021). The Hilton Times Square building is attached to the Applebee's, including an express walkway for guests to visit the restaurant, but the hotel closed its doors in September 2020. While the Hilton plans to reopen to the public in November, it doesn't help its (literal) Neighborhood Bar + Grill, which had undoubtedly suffered from the sudden lack of business from hotel guests. According to Roy Raeburn, co-founder of Apple-Metro, sales at the Times Square Applebee's location saw a staggering 75% drop compared to pre-pandemic levels, as of April 2022.
Applebee's isn't the only restaurant closing in the area, either. The Times Square McDonald's closed for good in June 2020 after operating for almost 20 years, per New York Daily News. According to Times Square Alliance via Eater, May 2021 saw an encouraging increase in daily foot traffic to 185,000. But, compared to the 365,000 folks who ambled through Times Square every day pre-pandemic, it's slow growth. Still, other businesses are beginning to crop up. In July, fried chicken giant Popeye's signed the lease on a new flagship location in Times Square, says New York Post. Hopefully, as some businesses leave the area, others will continue to take their places.