Restaurant chains including the Cheesecake Factory, Wendy’s, and Subway are trying to help their store locations with rent costs amid the novel coronavirus outbreak.
Some chains are calling for rent reductions from landlords, while others are covering the bills for their franchisees.
Many companies cited declines in business for the rent issues, saying closures from the novel coronavirus outbreak have affected their sales.
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The Cheesecake Factory, Wendy’s, and other chains are helping their stores seek rent relief as the coronavirus forces their doors to close.
According to multiple reports, some chains are calling for rent reductions from landlords and telling their stores to stop paying rent entirely, while others are covering payments for their franchisees.
Many companies say the decline in sales makes it difficult or impossible for them to pay rent for their restaurants.
Restaurant and retail workers across the US and worldwide have struggled with closures in areas impacted by the coronavirus outbreak, and many are trying to figure out what to do next.
The rent arrangement differs between restaurant companies. Some, like The Cheesecake Factory and Subway, pay rent to local landlords. While others, like McDonald’s, act as the landlord that collects rent from local franchises.
At The Cheesecake Factory, which operates nearly 300 locations across the US and Canada, CEO David Overton wrote a letter to landlords saying that the “severe decrease in restaurant traffic has severely decreased our cash flow and inflicted a tremendous financial blow to our business.”
He told landlords that stores would not pay rent for April because of the losses, according to the letter obtained by Eater.
“Due to these extraordinary events, I am asking for your patience and, frankly, your help,” he wrote.
CFO Mathew Clark told People magazine that he hopes the company and landlords “will be able to work together to weather this storm in the appropriate manner.”
Many people on Twitter praised The Cheesecake Factory over its decision to hold off paying rent.
Who had money on Cheesecake Factory starting the revolution? https://t.co/JiSwEJ31Wx
— Jemele Hill (@jemelehill) March 25, 2020
I did not foresee Cheesecake Factory leading the #generalstrike, but I guess you take solidarity where you find it. https://t.co/gThEPbvYwJ
— Jeff Sharlet (@JeffSharlet) March 25, 2020
If the Cheesecake Factory said “nah” then I also will be participating in this “nah” movement on April 1. https://t.co/vBaZogf69f
— Edgar …read more
Source:: Business Insider