31-Jan-20 – Though it has closed its location in River North, the company that operates Bar Louie is trying to keep the business going.

BL Restaurant Operations, LLC, has filed for Chapter 11 bankruptcy and has proposed a plan to pay its creditors and remain in business.

In its petition for bankruptcy, filed on January 27, BL Restaurant Operations says it owes about $110 million to at least 5,000 creditors and has assets of $50-100 million.

Sysco Corporation, provider of food products, is owed the most, $3 million. Other creditors include Produce Alliance, a source of fresh produce, which its Chicago location is owed $371,217.

(Left) Tom Duffey (left in photo), then General Manager, and CEO John Neitzel on February 1, 2012, Bar Louie’s first official day at Marina City.

By selling assets – cash, bank accounts, accounts receivable, inventory, contracts, intellectual property, purchase orders, equipment, and furniture – BL Restaurant Operations says funds will be available for distribution to unsecured creditors.

The company has hired Carl Marks Advisory Group as its restructuring advisor. The New York firm has provided a Chief Restructuring Officer, Howard Meitiner, and other personnel to help carry out the reorganization plan.

A successful bidder would have to offer at least $82.5 million and pay off what the company owes. If there are no bidders, BLH Acquisition Company will acquire company assets at rock-bottom prices.

BL Restaurant Operations says it has access to $22 million from two lenders, Antares Holdings LP and MidCap Financial Trust, to keep it going while in bankruptcy.

Company blames loss of traffic for store closings

Nationwide, BL Restaurant Operations, based in Addison, Texas, has closed 38 corporate-owned locations, including the Bar Louie at Marina City in River North and one in Naperville. About 96 Bar Louie locations are still open, including one in the Printer’s Row neighborhood of the Loop and one at 1325 South Halsted Street.

Meitiner says while sales overall were increasing, the cost of opening new locations was leaving the company short of money for refurbishments and maintenance, resulting in an experience for customers that was inconsistent across locations.

“This inconsistent brand experience, coupled with increased competition and the general decline in customer traffic visiting traditional shopping locations and malls, resulted in less traffic at the company’s locations proximate to shopping locations and malls,” said Meitiner (right).

According to Meitiner, the 38 locations that were closed were seeing sales and profits declining “at an accelerating pace.” At each of those locations, he says sales were off 10.9 percent in 2019 from the year before.

When Bar Louie opened at Marina City on February 1, 2012, the company’s local marketing manager, Katie Nelson, said they were “blown away” by traffic to the location. Over its first weekend, the River North location sold more than 1,300 martinis and in its first week estimates it served 5,000 customers.