- October 8, 2020
The Cheesecake Factory, with four locations in the region and 17 in Florida, has sent a letter to its landlords indicating it doesn’t plan to pay rent on its leases in April.
“Given the impact of governmental regulations and landlord decisions to close properties, considering the nature of our rent obligations and as part of ongoing efforts to manage our financial position and further preserve financial flexibility, we are not planning to pay rent on our leases for the month of April 2020 at this time,” the company states in a March 27 public filing with the Securities and Exchange Commission.
In the letter, The Cheesecake Factory founder, Chairman and CEO David Overton says that due to the extraordinary events around the coronavirus pandemic, “I am asking for your patience, and, frankly, your help.”
“Please understand that we do not take this action or make this decision lightly, and while we hope to resume our rent payments as soon as reasonably possible, we simply cannot predict the extent or the duration of the current crisis,” states the letter, according to a copy of it on Eater LA, near the company’s Beverly Hills headquarters. “We are continuing to evaluate the implications of this situation on our business and we realize the impact this action will have on our landlords. We appreciate our landlords’ understanding given the exigency of the current situation.”
The Cheesecake Factory locations in the region include:
• Naples, in the Coastland Center Mall owned by Brookfield Properties Retail Group;
• Brandon, in Westfield Brandon, owned by the Westfield Group;
• Tampa, in International Plaza, owned by Taubman Centers; and
• Sarasota, in the Mall at University Town Center, also owned by Taubman Centers.
Mall owner Simon Property Group announced a deal to buy Taubman Centers in early February, in a $3.6 billion deal. That acquisition hasn’t closed and could be delayed or scuttled due to ramifications of the coronavirus pandemic.
In addition to the April lease announcement, The Cheesecake Factory, in the same SEC filing, announced base salary reductions for Overton and other executive officers and reduced pay for all corporate employees and bakery administration employees of between 10% and 20%. The company also furloughed some 41,000 hourly restaurant staff members.