Roti, a Chicago-based Mediterranean concept, filed for bankruptcy on Friday.
The fast casual will use court proceedings to find new investors or buyers. It will also reorganize its finances to ensure its locations remain open across the Chicago, Minneapolis, and Washington, D.C. metro areas.
Roti has suffered from higher costs, inconsistent location performance, and tough macroeconomic conditions, according to CEO Justin Seamonds. The brand was disproportionately impacted by COVID since 50 percent of its footprint is based in downtown trade areas. In April 2021, the company was forced to close 14 of its 42 locations.
Roti made it past this headwind, but now faces a new environment in which customers are pulling back spending. The chain now lists 19 locations on its website.
“Our vision to create happier, healthier and more flavorful lives comes to life by providing our guests with exceptional food experiences—even in the face of current headwinds,” Seamonds said in a statement “After careful consideration, filing for bankruptcy protection was the best way to address our challenges.”
Roti plans to negotiate with landlords and suppliers to help keep locations open.
“With the restaurant industry in turmoil, we are proud of our transparency with our team, and the goodwill we’ve earned over time with our vendor and landlord communities during a tough four years. Bankruptcy is a process designed to provide companies like us with the tools to stay open, keep our exceptional team members employed and explore future prospects for Roti. We expect our loyal, flavor-seeking guests to continue to enjoy us while we tackle this necessary next step in our journey,” Seamonds said.
Roti was founded in 2006. In 2018, it received a $23 million equity investment led by Chicago-based Valor Equity Partners. In February 2020, the company hired Seamonds as CEO.
Roti joins several entities that have declared bankruptcy thus far in 2024, including Red Lobster, Rubio’s Coastal Grill, Tijuana Flats, Sticky Fingers, Oberweis Dairy, Foxtrot and Dom’s Kitchen, Tocaya and Tender Greens, a 126-unit Pizza Hut franchisee, a 25-unit Arby’s franchisee, a 48-unit Subway franchisee, a 17-unit Popeyes franchisee, and a six-unit Alamo Drafthouse Cinemas franchisee.
