Applebee’s Franchisee Files for Bankruptcy as Dine Brands Moves to Acquire 53 Units

A recent Restaurant Business Online article spotlighted a major development inside the Applebee’s system as Atlanta-based Neighborhood Restaurant Partners filed for Chapter 11 bankruptcy, placing 53 franchised restaurants in Alabama, Florida and Georgia into a court-supervised sale process. The filing reflects the pressure many restaurant operators continue to face as inflation, weaker consumer spending and higher operating costs weigh on performance across casual dining.

Neighborhood Restaurant Partners acquired the restaurants in 2012 and experienced periods of growth, but the business became increasingly unstable over time. The situation worsened in 2025, when the company lost money and closed nine locations in an effort to stabilize operations. It later hired Citizens Bank to market its assets, leases and franchise agreement, but no buyer emerged after several months. That led to the closure of another five restaurants earlier this year and ultimately pushed the company into bankruptcy court.

Now, Applebee’s parent company, Dine Brands, is positioned to take control of the portfolio. Neighborhood Restaurant Partners reached a tentative agreement with Dine in February, but the franchisee’s financial condition deteriorated before the transaction could close outside of court. In the bankruptcy case, Applebee’s is serving as the stalking-horse bidder and is expected to complete the acquisition by mid-May.

Dine CEO and Applebee’s President John Peyton said the move is intended to protect the system and preserve the value of the restaurants. “Serving as the stalking horse bidder gives us the opportunity to be strategic and selective in supporting the long-term health of the system and this portfolio of restaurants has historically had solid performance,” Peyton said.

The development is notable because it reflects Applebee’s broader willingness to directly operate restaurants after years of relying entirely on franchisees. Last year, the company acquired 47 locations from franchisees with plans to renovate them, improve performance and eventually refranchise them. That strategy points to a more hands-on role for franchisors when large operators begin to struggle.

For the franchising industry, this bankruptcy is less a sign of systemic weakness than a reminder of how vulnerable franchisees can be to rising labor, food and financing costs. It may also point to a growing trend of franchisors stepping in more aggressively to preserve unit-level performance, protect brand standards and stabilize key markets when major operators falter.

Read the original article here.

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