Coronavirus prevents Cheesecake Factory from making rent
March 26, 2020
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Rewards Network CEO Ed Eger says while they’re concerned with the health of Americans, the business implications of coronavirus is significant since the industry employs about 10 percent of the country’s workforce.
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Given the uncertainty and drastic drop in demand in the restaurant industry, national chain The Cheesecake Factory has revealed some struggles it is pushing through during the coronavirus crisis.
In a letter on March 18, Cheesecake Factory CEO David Overton informed its landlords it would not be able to make its rent payments for the month of April, citing a severe decline in restaurant traffic that has “inflicted a tremendous financial blow” to business. The restaurant chain has been forced to close 27 stores across the country and others have been restricted to only take-out and delivery orders, which it said just days ago was enabling the company to “operate sustainably at present."
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Overton writes, "Due to these extraordinary events, I am asking for your patience, and frankly, your help.”
He continued, "Please understand that we do not take this action or make this decision lightly, and 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…We appreciate our landlords’ understanding given the exigency of the current situation.” (Eater obtained the letter)