When trouble began<\/p>\n
Abuelo\u2019s \u201cbegan seeing headwinds in 2023 as inflation persisted and consumer willingness to spend on discretionary items, such as dining out, remained low,\u201d said Robert Lin, president of FCI Holdings.<\/p>\n
In 2023, Abuelo\u2019s suffered a 5.9 percent drop in traffic from 2022, along with \u201cincreased wage pressure.\u201d<\/p>\n
\u201cUnfortunately, consumer weakness, labor shortages, and rising labor and food costs continued through 2024,\u201d Lin claimed in court records.<\/p>\n
He also mentioned severe weather in parts of the country caused $550,000 or more of lost revenue in 2025.<\/p>\n
Lin claimed takeout sales were up 7.7 percent last year as people preferred to eat at home. But that cut into drink sales.<\/p>\n
The economic factors Lin mentioned are on top of nearly $6 million in debt payments by Abuelo\u2019s and another $1.7 million by Food Concepts in the 90 days prior to bankruptcy \u2013 which is more than $2.5 million per month on average.<\/p>\n
Even before the bankruptcy, Abuelo\u2019s had already reduced corporate overhead and closed certain \u201clow performing\u201d locations, he said.<\/p>\n
The bankruptcy schedules said Abuelos recently closed another seven restaurants in addition to earlier closings. The recent ones were Texas locations in Austin, Katy, League City and Plano along with locations in Chandler, Arizona; Kissimmee, Florida; and Tulsa, Oklahoma. (See more complete list of open and closed locations below.)<\/p>\n
Two lenders come forward<\/p>\n
Andrews and Sharbutt offered financing to get Abuelos through bankruptcy. They were described as current shareholders and members of FCI Holding\u2019s board of directors, court records showed.<\/p>\n
They agreed to do something called \u201cdebtor in possession financing.\u201d Their loan gets the priority on payback. They offered $500,000 at first and another $1 million if needed for a total of $1.5 million.<\/p>\n
In the first few days of the case, judge Edward L. Morris agreed to this idea, saying in his ruling, \u201cWithout obtaining financing on a post-petition basis, the debtors will not be able to pay their operating expenses.\u201d<\/p>\n
The loan itself carries no interest, but the default rate is 12 percent. The loan terminates on next August 30, or after certain things (like the approval of a restructuring plan) are completed in the bankruptcy. The biggest creditors are a bank, a commercial leasing company and three food vendors.<\/p>\n
Lin asked the bankruptcy judge to authorize the restaurant to pay ongoing salary, food vendors, utilities and other similar expenses and Morris granted the request.<\/p>\n
Struggle vs. hope<\/p>\n
Lin expressed optimism the company can survive.<\/p>\n
\u201cThe ongoing operations are anticipated to continue to generate revenues sufficient to not only support current operating expenses, but an exit from this reorganization proceeding,\u201d Lin wrote.<\/p>\n
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82nd Street and Quaker Avenue. Credit: Staff photo.<\/p>\n
Abuelo\u2019s, Food Concepts and FCI Holding have the \u201cexclusive\u201d right to file a reorganization plan in the first 120 days of the case. A judge can extend the deadline to 18 months. Once the exclusivity period expires, creditors can file competing plans.<\/p>\n
Lin also listed payroll details as they were in early September.<\/p>\n
\u201cAll told, approximately 1,014 employees are paid hourly, \u2026 and approximately 88 employees are salaried,\u201d he wrote.<\/p>\n
He listed the biweekly payroll for Abuelo\u2019s as $658,000, plus more than $11,000 for deposit into 401k plans. Add to that federal employment taxes of more than $226,000.<\/p>\n
Additionally, the biweekly payroll at Food Concepts was nearly $69,000 plus more than $10,000 for 401k and employment taxes of more than $22,000<\/p>\n
The history<\/p>\n
The Abuelo\u2019s website said its first location was Amarillo. No later than 2004, the parent company was operating its headquarters in Lubbock, according to kcbd.com<\/a>. <\/p>\n \u201cThe Debtors own and operate a chain of full-service, casual dining Mexican restaurants serving made-from-scratch Mexican food. The Debtors\u2019 first restaurant opened in 1989, and they now operate a total of 16 restaurants located in 9 states throughout the nation,\u201d Lin\u2019s declaration said.<\/p>\n However, LubbockLights.com could only verify seven states currently from the bankruptcy case.<\/p>\n It used to be nine states, based on screen captures from the Abuelo\u2019s website between 2019 and 2023 from web.archive.org. A 2016 press release said Abuelo\u2019s was opening a 40th location. We found 37 of them and cross referenced those with the current Abuelo\u2019s website to show which locations are still open.<\/p>\n Arizona<\/p>\n Arkansas<\/p>\n Florida<\/p>\n Kissimmee<\/p>\n Lakeland (open)<\/p>\n Indiana<\/p>\n Kansas<\/p>\n Wichita Ridge Road (open)<\/p>\n Wichita Waterfront (open)<\/p>\n Kentucky<\/p>\n Missouri<\/p>\n Ohio<\/p>\n Columbus<\/p>\n Warrensville Heights<\/p>\n Oklahoma<\/p>\n OKC-Bricktown<\/p>\n OKC-North<\/p>\n Tulsa East<\/p>\n Tulsa Nickel Creek (open)<\/p>\n South Carolina<\/p>\n Tennessee<\/p>\n Bartlett<\/p>\n Chattanooga<\/p>\n Knoxville<\/p>\n Texas<\/p>\n Abilene (open)<\/p>\n Amarillo (open)<\/p>\n Arlington (open)<\/p>\n Austin<\/p>\n College Station<\/p>\n Fort Worth (open)<\/p>\n Hurst (open)<\/p>\n Katy<\/p>\n League City<\/p>\n Lubbock (open)<\/p>\n Midland (open)<\/p>\n Plano<\/p>\n The Colony (open)<\/p>\n Tyler (open)<\/p>\n Virginia<\/p>\n Echoes of Don Pablo<\/p>\n Abuelo\u2019s claims on its website to be \u201cthe #1 Mexican Restaurant in America.\u201d<\/p>\n That might sound reminiscent of Don Pablo\u2019s, which made a similar claim in the past.<\/p>\n According to thetakeout.com<\/a>, \u201cDon Pablo\u2019s first hit the scene in 1985 \u2026 Its inaugural restaurant opened in Lubbock, Texas, offering a range of classic Tex-Mex cuisine \u2026\u201d<\/p>\n \u201cThe restaurant offered all the typical Tex-Mex staples. Menus were packed with the \u2026 tacos, fajitas, nachos, salads and Don Pablo\u2019s signature margaritas, made with fresh lime juice, while its flour tortillas were made fresh throughout the day at its in-house tortilla stand, all served cafeteria-style,\u201d thetakeout.com reported.<\/p>\n Nation\u2019s Restaurant News (NRN.com) quoted bankruptcy filings<\/a> from 2016 and reported, \u201cThe chain was founded in 1985 in Lubbock, Tex. At one point, the company said in a filing, it had 120 locations around the country and was one of the largest full-service Mexican chains in the country.\u201d<\/p>\n \u201cThe casual dining industry is highly competitive and faces increased competition from fast-casual dining options. \u2026 Despite the relatively steady economy in most of the United States, the casual dining environment remains depressed,\u201d NRN.com quoted court records as saying.<\/p>\n Lin described Abuelo\u2019s \u201ccasual dining\u201d as under pressure from inflation, lower consumer willingness to eat out and a combination of labor shortages with increased wages and food costs.<\/p>\n Unlike Abuelo\u2019s with one owner, Don Pablo\u2019s had five owners during its run starting with DF&R Restaurants, Inc. and ending with Food Management Partners, which closed the last location in 2019.<\/p>\n The timing of Don Pablo\u2019s closure in Lubbock is not documented precisely online, but the property, in the 4600 block of 50th Street, sold to a bank in late 2007.<\/p>\n
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