Toronto company behind Buca and Jacob's Steakhouse seeks protection from creditors
The hospitality company King Street Restaurant Group has filed for insolvency.
According to the Companies' Creditors Arrangement Act (CCAA), King Street Company Inc. currently owes more than $34 million to its creditors.
Aside from the eight restaurant locations they were operating prior to the pandemic, the hospitality company had also entered leases for eight new locations prior to the onset of COVID-19, including the new Cucina Buca, whose opening has been postponed.
But due to lockdown, the company has seen a 98 per cent decrease in year-on-year sales from April to September 2020.
The CCAA also attributes major losses to insufficient revenues at Jamie's Italian locations at Yorkdale Mall and Square One. Both franchises closed down permanently this year.
The King Street Restaurant Group is seeking help from the CCAA to stabilize the company's finances while its affiliated brands continue to operate their takeout and delivery services.
"Alongside the entire hospitality sector, the COVID-19 Pandemic has put us in an extremely difficult situation that was beyond our control,” Peter Tsebelis, Managing Director & Partner of the hospitality group said in a statement.
"This was an emotional decision for us but [we] are confident that the CCAA process will give us time to stabilize our business and ultimately put us in a stronger position to build on our successful brands as we emerge from the COVID crisis."
The past eight months have seen a number of permanent closures for the hospitality group. Last month, Bar Buca was evicted from its Eglinton location after owing more than $22K in arrears.
All four of Buca's locations have remained closed during the pandemic, with pick-up and delivery services operating out of 2 St. Clair West.
Jacobs & Co. is also still offering pick-up and delivery, while La Banane and CXBO remain temporarily closed without online shops.
With indoor dining restrictions tentatively being lifted on November 14, the company says it may be reopening some restaurants in the future, including Jacobs & Co., La Banane, and some locations of Buca.