An Atlanta‑based franchisee that operates 53 Applebee’s restaurants across the US South filed for Chapter 11 bankruptcy Tuesday in federal court as the chain’s company may take control of the business.
The company, Neighborhood Restaurant Partners, which runs locations across Alabama, Florida and Georgia, reported assets of $1 million to $10 million and liabilities of $10 million to $50 million, including more than $13 million owed to Equity Bank.
The group acquired its Applebee’s locations in 2012 and initially experienced growth. However, business has been uneven since 2015, and financial pressures have intensified recently due to rising inflation and a slowdown in consumer spending. In 2025, the company lost money and responded by closing nine restaurants to curb losses, Restaurant Business reports.
To explore a potential sale, the group hired Citizens Bank to help in the process. After four to five months, the company was unable to find a buyer, and earlier this year, it was forced to shut down an additional five locations.
In February, the franchisee reached a tentative agreement with Applebee’s parent company, Dine Brands, under which the franchisor would take control of the business. However, worsening finances forced the owners to file for Chapter 11 bankruptcy before the deal could be finalized.
Under the bankruptcy proceedings, Applebee’s will serve as the stalking‑horse bidder, effectively setting a baseline for a potential sale of the restaurants. This arrangement is expected to allow Dine Brands to complete the acquisition by mid‑May, ensuring continuity for the remaining restaurants while the company reorganizes its finances.
Dine Brands CEO & Applebee’s President John Peyton said that while some franchisees may face financial challenges, the Applebee’s brand remains strong and stable.
“From time to time, individual franchisees face circumstances unique to their operations. What’s important here is that the Applebee’s brand remains strong. 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. We’re approaching this the same way we always do — with a focus on stability, growth, and doing what’s right for our guests, team members, and franchise partners,” Peyton said in a statement.
The move by Dine Brands to take control of locations aligns with the chain’s recent strategy of operating more of its own restaurants after years of relying entirely on franchisees. Last year, Applebee’s acquired 47 locations from other franchisees, planning to renovate them, boost performance and eventually refranchise them in a few years.
This method comes amid challenges for the brand, which has experienced two consecutive years of negative same-store sales across its 1,600 restaurants. However, performance has improved recently, with a 1.3 percent year-over-year same-store sales increase in 2025, according to Restaurant Business. Applebee’s credits its recovery in part to popular promotions, like the 2 for $25 meal deal.
At least two other Applebee’s franchisees, Louisiana Apple and Apple Central KC, have filed for bankruptcy in recent years, affecting a total of 22 locations.
