The organization behind local restaurant and comfort food success story Al’s Burger Shack has filed for bankruptcy reorganization amid recent expansion efforts.

Three separate Chapter 11 bankruptcy forms were filed on behalf of Al’s Burger Shack according to the Triangle Business Journal, one for the Franklin Street location that listed assets of less than $50,000 on liabilities ranging between $500,000 and $1 million, and another two for the Southern Village and Governor’s Village restaurants with similar reported ratios.

Al’s released a prepared statement following the news:

“On Friday, Al’s Burger Shack filed for bankruptcy protection. While sales are strong at our three locations, we overextended during expansion and need protection and relief while we reorganize. We appreciate your support and patronage and will need to keep public comments on these proceedings to a minimum. As grateful as we were to have received accolades in recent years, we are even more so to have been afforded this opportunity to regroup. Rest assured we have absolutely no plans to stop slinging burgers and hope to see you at Al’s soon.”

Since opening its first location on Franklin Street in 2013, Al’s Burger Shack has become a local staple and was ranked as having the “best burger in America” by TripAdvisor in 2018.

In 2019, Al’s Pub Shack opened in Governor’s Village as a new concept, but it was later renamed to Al’s Burger Shack. Al Bowers also teamed up with Chapel Hill native Chris Baldwin to open the “upscale dive bar” 401 Main in Carrboro in September. Last week, it was announced that Al’s Burger Shack would be expanding into Beer Study in Durham.

Attorney John Paul H. Cournoyer of Northen Blue LLP — who filed the bankruptcy on behalf of Al’s Burger Shack — said the businesses obtained “high-interest loans” as part of its expansion, saying “The restaurants are strong businesses, and if it were not for these loans the companies would be healthy.”

This post will be updated with more information as it becomes available.

Related Stories
‹
The Morning News: Election Approaching, Stolen Car Crashing - New Cradle Opening?
Get-out-the-vote efforts are underway for the 2026 election - including a concert at the site Cat's Cradle is developing as a third venue.
Al's Burger Shack Prepares to Open New Location in Hillsborough
Al’s co-owner Charlie Farris, who also owns Jersey Mike’s two units down, spoke with 97.9 The Hill about the new location.
The Morning News: Faith Hedgepeth Murder Trial, Gas Tax Suspension, UNC Basketball
In today's news: yesterday was day one of the trial of Miguel Salguero-Olivares for the 2012 murder of Faith Hedgepeth.
Local Artist Loren Pease Creates Vibrant Murals Across the Community
She is known for her murals adorning local businesses and buildings, and has plenty of projects coming to the community soon.
‘Mind Your Business’: Local Openings, Closings and Updates in April-June 2026
The spring led to some exciting openings for some and quiet closings for others. Read details on the greater Orange County business scene.
Al's Burger Shack Hailed as 'Best Cheeseburger in North Carolina'
The website Fast Food Club named Al’s Burger Shack in Chapel Hill as the best cheeseburger in North Carolina in a new list, which sought the best cheeseburger in every state. “The beef is locally sourced, the toppings are creative and seasonally inspired, and every burger is cooked with the kind of attention usually reserved […]
A New Bar, 'Extension' of Al's Burger Shack, Is Now Open in Downtown Chapel Hill
Al's Burger Shack at 516 West Franklin Street added another business to its operations, with the official opening of Puddin's Beer Shack.
'It's A Really Good Handoff': Al's Burger Shack Changes Ownership, But Stays Local
When asked what Al’s Burger Shack means to its namesake, Al Bowers sits back and takes a deep breath. It’s easier to talk about what the Chapel Hill restaurant represents to others. “I always wanted someone to have a memory every time they took a bite of a cheeseburger,” he says. “Or every time they […]
401 Main Aims To Split With Al's Burger Shack Founder
Ownership of the Carrboro bar 401 Main revealed it is aiming to end its relationship with Al Bowers, the founder of Al’s Burger Shack. In a conversation on Monday with Chapelboro, principal owner Chris Baldwin said the bar has had plans to move on from Bowers’ minority ownership since before the events of recent days, […]
Beer Study, Orange County Rape Crisis Center Cut Ties with Al's Burger Shack
Two local organizations have severed their relationship with Al’s Burger Shack. The Orange County Rape Crisis Center posted on Friday it has cut ties with Al’s Burger Shack amid public accusations of sexual harassment by founder Al Bowers. “All survivors of unwanted sexual attention- including rape, sexual assault, and sexual harassment- deserve safety and support,” the Facebook […]
›