Detroit — Olga’s Kitchen announced Friday evening it would close its One Campus Martius restaurant downtown as the company continues to work through bankruptcy and restructure its operations to cut costs.
The company said Friday it had come to an agreement with Bedrock Real Estate Services, which owns the building, to close the location immediately.
“Closing the One Campus Martius location is a necessary next step for our company and the continued health of all of our operations as we look toward the future,” Olga’s Kitchen Senior Vice President and Chief Operating Officer Michael Kosloski said in a statement. “We appreciate the support of our loyal guests in southeast Michigan who are the reason for our 45 successful years in business. We look forward to continuing to serve our local community at our other locations.”
Earlier in the day, the restaurant was serving lunch to patrons and there was no indication the location would be closing in a few short hours. By 5 p.m., the iconic giant sandwich over the Olga’s Kitchen sign had been removed, the signage on the windows had been scraped off and the restaurant closed down. Patrons looking to grab dinner were greeted by locked doors.
Olga’s One Campus Martius location, in the former Compuware Building, first opened in April 2012. All employees at this location will have the opportunity to apply for current open positions at the remaining 26 metro Detroit Olga’s locations, the company said.
“Bedrock was happy to work with Olga’s to relieve the company of its lease obligation and outstanding debt enabling this longtime Michigan business to take an important step forward in the financial restructuring of the entire restaurant chain,” Dan Mullen, Executive Vice President, Bedrock Real Estate Services, said in the statement.
The move opens up almost 4,000-square-feet of retail space at the heart of downtown Detroit.
“Several exciting operators have already expressed significant interest in this location and we expect to announce the final decision on a new tenant in the coming weeks,” said Mullen.
The Troy-based restaurant chain known for its signature gyro sandwich and bread named after its founder, filed for bankruptcy protection in June. There are 27 remaining restaurants open in Michigan and Illinois.
The bankruptcy filing lists the company as owing at least $4.48 million in unpaid loans and credit while having between $1 million and $10 million in assets. Its debts are greater because the company’s filing indicates it has “unknown” amounts of taxes owed to the state of Michigan and the federal Internal Revenue Service.
Among Olga’s Kitchen’s largest unsecured creditors are RBS Citizens in Detroit at $2.4 million; Commerce Township-based food service supplier Sysco at $1.2 million; and Art Financial/Washington Business Bank in San Mateo, California, at $356,342.
The bare-bones filing makes no mention of the company’s reorganization plans. In October, the company said it had more than 1,000 employees working at 33 restaurants, including 30 in Michigan, one in Ohio and two in Illinois.