Red Lobster scrambles to keep Times Square location open — as landlord seeks to double rent: sources
Red Lobster is scrambling to stay open in Times Square — but the bankrupt seafood chain has just a few weeks to hammer out a deal as its landlords seek to double the rent, The Post has learned.
The restaurant’s lease at the crossroads of the world expires on June 30 and it has been negotiating new terms with landlords SL Green and RXR – despite listing the location among the 200 stores it plans to close, according to a bankruptcy filing.
The owners of 5 Times Square, where Red Lobster has been a fixture for 22 years, are asking for an annual rent of $2.2 million for the three-level, 16,482 square-foot space, as The Post previously reported.
Currently, Red Lobster is likely paying just under $1 million a year for the corner space at West 41st St. and Broadway, a real estate broker who did not want to be identified told The Post.
The seafood chain has been closing scores of restaurants across the country since the week before its May 19 bankruptcy filing.
But employees of the Times Square location have been told that their store is not on the chopping block, multiple workers told The Post.
This is a high performing store and its not closing, a manager said on Thursday during lunch hour when there were just a handful of diners scattered throughout the three-story eatery.
The Orlando, Fla.-based company did not respond to a query for comment about the Times Square spot.
The fact that Red Lobster included the Times Square location on a list of leases that it’s rejecting “could be a way to exert pressure on the landlord,” bankruptcy attorney, Patrick Collins of Farrell Fritz told The Post.
“It’s a way for the company to signal to the landlord that unless something changes it’s prepared to close that store,” Collins added.
Nevertheless, anecdotal evidence suggests that business isn’t consistently booming. Earlier this month, The Post reported that the Times Square outlet was largely devoid of diners during two separate visits at lunchtime in early May.
Red Lobster was pushed to the brink, in part, by a $20 all-you-can-eat shrimp promotion last year that ended up being more popular than the company expected. The chain raised the price to $25, but that did little to dampen consumer appetites for the deal.
Its largest shareholder and seafood vendor, Thai Union, said the promotion forced it to write off $530 million in the fourth quarter.
Red Lobsters chief executive Jonathan Tibus its fifth CEO since 2021 blamed Thai Union for the companys recent problems, saying in a court filing that Red Lobster is investigating Thai Unions role in pushing for the shrimp promotion as a way to steer more business its way.
The Times Square location is its last remaining outpost in Manhattan, according to the companys website. This month it closed a Harlem eatery on West 125th St.
