2025 Restaurant Closures: Empty Tables and Hard Choices

The Year the Dining Boom Went Bust

It was supposed to be the summer of the rebound. Instead, the neon "Open" signs that once glowed on every corner began to flicker out. By mid-May, more than 4,300 chain restaurants—from fast-casual burrito bars to steakhouse legends—had locked their doors for good, according to industry tracker Placer.ai. The culprit: a perfect storm of labor costs up 18%, chicken breasts that cost more than sirloin did in 2021, and consumers who suddenly remembered they knew how to cook.

When the Rent Comes Due

At a half-shuttered strip mall in Parma, Ohio, the last server at a once-bustling TGI Fridays taped a handwritten note to the glass: "We served 187 million wings. Thanks for the memories." Inside, stools were upside-down on tables, the arcade dark, the smell of fryer oil already turning rancid. Regional manager Carla Jimenez, 42, had 48 hours to clear out inventory. "We liquidated everything—ketchup packets, birthday sombreros, even the booth where a couple got engaged last Christmas," she said. "The fiancée cried harder than when she said yes."

We liquidated everything—ketchup packets, birthday sombreros, even the booth where a couple got engaged last Christmas.Carla Jimenez, former TGI Fridays regional manager

The Dominoes Begin to Fall

The first warnings flashed in January, when Red Lobster’s credit rating was downgraded to junk. By March, the company had closed 87 locations; in April it filed for Chapter 11. Industry veterans call it the "seafood signal"—when a chain that once gave away 1 million shrimp in a single day can’t stay afloat, no one is safe.

Next came Boston Market, which shuttered its final 214 stores after lenders pulled the plug. Then Rubio’s Coastal Grill exited Florida entirely, citing "unsustainable rent." Even fast-casual darling Sweetgreen closed 12 underperforming outposts, a startling move for a brand that went public on the promise of infinite growth.

Behind the Balance Sheet

Commercial rents have risen 28% since 2022, but the real killer is labor. Twenty-one states bumped minimum wages in 2025, and tipped workers in Chicago now earn $15.80 an hour before gratuities. Meanwhile, menu prices can climb only so far; after the fourth price hike, guests simply stay home.

• Labor costs up 18% YoY
• Commercial rents up 28% since 2022
• Food inflation: chicken +34%, beef +22%
• Average check growth plateaued at 6%

What Survives the Cull

Chains with drive-thrus fared best—think Chick-fil-A and McDonald’s—because they need 30% fewer front-of-house staff. Fast-casual brands that invested in app-based loyalty programs kept repeat visits 11% higher than those that didn’t, data from Revenue Management Solutions shows. And family-run independents? They’re negotiating rent reductions in exchange for percentage leases, betting personal relationships can outrun Wall Street spreadsheets.

Empty Tables, Full Memories

Back in Parma, Carla Jimenez swept one last pile of confetti into a trash bag. "I’m 42 and I’ve only ever done this," she said, voice cracking. "But I’ll tell you what: the first round at whatever pops up here next is on me." For now, the parking lot sits quiet, a monument to the year America’s appetite met its match.