A week after announcing a credit default and receiving a downgraded “junk” rating from Standard & Poor’s, Sbarro Inc. pizza chain may be closing some of its units.
The 55-year-old, Melville-N.Y.-based company runs close to 1,000 restaurants in 30 countries.
Crain’s New York has reported that the chain is considering several restaurants for closure, particularly in the New York City market.
Currently, there are six Manhattan locations, seven Sbarro's in Queens and one in Brooklyn. Brokers predict units in notoriously high-rent Manhattan to close first. Last year, a Sbarro closed on East 45th Street and Lexington Avenue.
The default was attributed to the economic downturn, as well as a decrease in mall traffic, where many Sbarro’s restaurants are located. In Manhattan specifically, Sbarro was met with a bevy of new competitors, including Pizzarte, Z Pizza, Village Krust, Pizza Roma and Pizza Plus.
The company is nearly $350 million in debt.