How Many Wendy's Locations Does Meritage Hospitality Run? Group Files for Bankruptcy

One of Wendy’s largest U.S. franchise operators has filed for Chapter 11 bankruptcy protection, citing mounting financial pressures tied to the fast-food chain’s prolonged sales slump and rising operating costs.

The filing emphasizes the growing strain on restaurant operators as consumers pull back spending while food and labor expenses remain elevated. Workers, franchise owners and diners could all feel the effects as the restructuring unfolds, even though the company says restaurants will remain open during the bankruptcy process.

Grand Rapids, Michigan-based Meritage Hospitality Group announced Thursday that it had voluntarily filed for Chapter 11 protection in the U.S. Bankruptcy Court for the Western District of Michigan.

The company said the move is intended to strengthen its balance sheet and create a sustainable capital structure while continuing operations. Meritage operates over 300 Wendy’s restaurants across 15 states, along with one Bojangles location and five independently branded restaurants.

Court filings estimate assets and liabilities at between $10 million and $50 million, while Wendy’s franchise business is listed as the company's largest unsecured creditor with a claim of roughly $24.9 million in deferred franchise fees.

The bankruptcy arrives as Wendy’s continues to grapple with declining traffic, increasing discounting and higher commodity costs. Meritage executives previously said store-level EBITDA plunged 48 percent in 2025, while rising beef prices and greater promotional activity eroded profitability.

Wendy's referred Newsweek to the company's statement, reading, "Our focus remains on serving our customers, supporting our franchise system, and strengthening the long-term health of the brand. We partner closely with franchisees that are experiencing challenges to support them and evaluate each situation on a case-by-case basis to identify the best and most sustainable path forward."

Newsweek reached out to Meritage Hospitality Group for comment.

Meritage Hospitality Group is one of the largest franchise operators within the Wendy’s system. Founded in 1986, the company originally owned hotels before exiting the lodging business and acquiring its first 28 Wendy’s restaurants in Michigan in 1998.

Over the following two decades, Meritage expanded aggressively through acquisitions and new store development. The company acquired dozens of Wendy’s locations across multiple regions and, by 2023, had grown to approximately 375 Wendy’s restaurants.

Beyond its Wendy’s holdings, the operator launched its Morning Belle brunch chain and diversified into several independent restaurant brands.

That expansion strategy made Meritage heavily exposed to Wendy’s corporate performance. In its bankruptcy announcement, the company acknowledged that system-wide pressures affecting the Wendy’s brand had a disproportionate impact because most of its restaurant portfolio operates under the chain's banner.

The company currently employs approximately 9,000 workers and said it intends to continue paying wages and benefits throughout the restructuring process, subject to court approval.

Meritage said it operates 314 Wendy's restaurants across 15 states, plus one Bojangles restaurant and five independently branded concepts.

Its footprint stretches across Michigan, Florida, North Carolina, Texas, Oklahoma, Ohio, Indiana, Tennessee, Virginia, Georgia, Connecticut, Massachusetts, Arkansas, Mississippi and Missouri.

The company remains one of the largest Wendy's franchisees in the country despite recent retrenchment. Company records indicate it previously expanded to roughly 375 Wendy's locations through acquisitions before later reducing its footprint.

In Michigan alone, Meritage operates more than 50 Wendy's restaurants and several Morning Belle locations. The company also owns 13 Wendy's restaurants in Oklahoma County, though bankruptcy filings do not indicate whether any specific locations could be impacted by the restructuring.

For now, Meritage says all restaurants are expected to continue operating during the Chapter 11 process, according to a company press release.

The bankruptcy filing applies to Meritage Hospitality Group, not Wendy's as a corporate entity.

Neither court filings nor company statements indicate that all Meritage-operated Wendy's restaurants will close. In fact, the company has repeatedly stated that it expects to maintain restaurant-level operations during the restructuring and continue serving customers throughout the Chapter 11 process.

Chapter 11 bankruptcy generally allows businesses to reorganize debts while continuing operations. Many restaurant companies use the process to restructure leases, refinance obligations or negotiate with creditors without shutting down entirely.

That does not rule out future restaurant closures. Bankruptcy proceedings often involve portfolio reviews that can result in underperforming locations being sold, transferred or shuttered. However, no widespread closure plan has been announced.

The filing has prompted questions about whether Meritage's troubles reflect company-specific issues or deeper challenges facing restaurant operators nationwide.

"This reflects broader restaurant industry stress," financial educator Michael Ryan told Newsweek, though he added that Meritage also faced "some Wendy's specific problems layered on top of it."

Ryan pointed to industry-wide profitability concerns, noting that "42 percent of restaurant operators said they weren't profitable in 2025" despite strong overall restaurant sales.

"Restaurants are getting squeezed from both directions," he said. "Ground beef averaged $7+ a pound in August, and restaurants no longer have the luxury of simply passing every increase along. At some point, the customer looks at the price of a fast-food meal and says, 'I'll eat at home.'"

Ryan argued that franchise economics can intensify those pressures.

"Royalties are based on sales, not the franchisee's profit," he said. "So when traffic weakens and the brand responds with discounting, the operator can take the margin hit while still owing fees based on the revenue that remains."

He also highlighted a notable detail from the bankruptcy filing, saying Wendy's franchise business was Meritage's "largest unsecured creditor," owed nearly $25 million in deferred franchise fees.

Alex Beene, a financial literacy instructor at the University of Tennessee at Martin, said consumers have spent the past two years signaling that fast-food prices have become difficult to justify amid broader inflation pressures.

"Fast food chains find themselves in a difficult middle ground of pricing," Beene said. "More expensive than many grocery stores and in some cases barely below more formal restaurants, their current pricing is a tough sale for many customers who are cash-strapped."

Kevin Thompson, founder and CEO of 9i Capital Group, said the bankruptcy should be viewed through both an industrywide and company-specific lens.

"The reality is that this is a combination of broader economic conditions and company-specific challenges," Thompson said. "Higher interest rates increase borrowing costs, particularly for heavily leveraged franchise operators, while higher input costs continue to compress margins."

Thompson added that additional distress among restaurant operators remains possible as elevated borrowing costs and margin pressures persist throughout the sector.

Contact Newsweek editors on this story: Samantha Beech and Sam Wilson.