Beloved Mexican chain files for bankruptcy, closes 24 locations

LUBBOCK, Texas — Abuelo’s Mexican Restaurant, a Texas-based chain known for its upscale take on traditional Mexican cuisine, has filed for Chapter 11 bankruptcy after years of financial strain and shifting consumer habits, Restaurant Business reported.

According to the media outlet, the move comes after the company shuttered 24 locations, reducing its footprint from 40 restaurants nationwide to just 16.

The bankruptcy filing lists assets and liabilities between $10 million and $50 million. Abuelo’s parent company, Food Concepts International, also filed for bankruptcy and requested the cases be combined.

Despite the bankruptcy, Abuelo’s says it will keep its remaining locations open across seven states, including Texas, Oklahoma, Florida and Arizona, the Lubbock Avalanche Journal reported. The company emphasized that its flagship Lubbock, Texas restaurant will remain a cornerstone of its operations.

Founded in Amarillo in 1989, Abuelo’s offers courtyard-style dining rooms and scratch-made dishes.

According to Chron, the chain has faced mounting challenges, including a 15% sales decline last year, rising food and labor costs, and staffing shortages. Extreme heat waves in 2024 forced temporary closures, costing the company an estimated $500,000 in lost revenue.