The closure of Taqueria Las Gemelas and Destino, two promising Mexican restaurants inside Union Market District’s La Cosecha food hall, was a quick and painful one, particularly for the people who opened and staffed those sister establishments, several of them tell DCist/WAMU.

The restaurants’ estimated 40 staff members — including many who worked there since its inception in March 2021 — learned of the closure on the last day of service, Feb. 4. Even chef Yesenia Neri-Diaz, a partner in the business who helmed the two spots’ shared kitchen and whose daughters inspired the names of the restaurants, only heard about the closing that day and did not see it coming, she says.

Owner Josh Phillips made the decision to close just 24 hours before, when he received an email from the landlord demanding that the restaurants pay their back rent almost immediately, he tells DCist/WAMU. His co-owner and wife, Kelly Phillips, learned of the closure just after staff did because she was on a planned vacation in Japan, Josh Phillips says.

After consulting with an investor, Phillips decided that it was better to call it quits and pay staff their last paycheck with most of the remaining dollars in the restaurants’ accounts than to continue to hobble along. If the restaurants stayed open, the owners were worried they wouldn’t be able to pay their workers, who earned at or above minimum wage, and he says the business has always prioritized payroll over rent.

Phillips does not fault his landlord, Edens. The company worked with them over the last several years, he says, but he understands rent concessions couldn’t last forever and Edens needs to pay for its operations and staff too.

Edens declined to discuss the company’s agreements with Las Gemelas and Destino, saying only that the landlord has been “deeply engaged” with the restaurants since their launch, and appreciates their partnership and their “significant contribution” to La Cosecha, Sommer Hixson, Edens’ director of brand communications, said over email.

The sudden closure of Las Gemelas and Destino speaks to how relentlessly challenging and brutal the restaurant industry is right now. It’s unclear how many local restaurants are still recovering from the COVID-19 pandemic and are in debt, but some spots have faced eviction and lawsuits for failing to pay rent that started to pile up during those pandemic days. And sometimes employees are in the dark about their workplaces’ struggles, as was the case with Las Gemelas and Destino.

“I’m surprised and I can’t explain it. It was like a part of my heart,” Neri-Diaz says in Spanish of the restaurants.

Neri-Diaz, a 2020 RAMMY Award finalist for employee of the year for her work at the Phillips’ shuttered restaurant Espita, and others are now looking for work, according to multiple workers who used to work at Las Gemelas and Destino. Neri-Diaz says she is in a better position than some of her colleagues because she has her husband to lean on. She worries about the single mother she worked with who depended on the job, she adds.

Another laid-off worker says a few of his colleagues asked to borrow money for rent because they don’t have enough in savings. The worker, who requested anonymity for fear of compromising future job opportunities, says he only started saving during the pandemic for his kids.

That employee, Neri-Diaz, and a third worker who also requested anonymity to protect future job opportunities tell DCist/WAMU they feel blindsided, saying they had no idea the business was on the verge of closing and wish the owners had been more forthcoming about their struggles. The lack of notice runs counter to their working relationship with the owners and the overall ethos of the company, several former workers say. Ultimately, the laid-off workers wish they got some notice, so they could apply to other jobs and prepare themselves. Now, some feel forced to take any job that comes along.

“It’s not fair that they decided to do that just overnight,” Neri-Diaz says.

Phillips says he did not want to share the bleak financials with the team because he worried that would impact morale but is now trying to help his laid-off workers get jobs. He was also hoping that if they could hold on until the spring and summer months — when they make upwards of $100,000 a week in sales compared to the $20,000 a week in winter — they could get out of the hole. The landlord’s email requesting back rent so quickly was unexpected — albeit reasonable, he says.

“Our team was incredibly talented and such a great group of people. I wish I could have given them more notice, but when I got that email, I ran out of options for how to keep the doors open,” he says. “We probably should have closed the restaurants months ago instead of trying to draw it out, but we kept hoping that if we could just get to the spring when sales normally increase dramatically, we could begin to get the company back on track and keep the team together.”

Las Gemelas and Destino, formerly called Las Gemelas Cocina Mexicana, received rave reviews when they debuted. Las Gemelas was even the first eatery Joe Biden visited as president because the sister establishments were the first to receive a federal COVID-19 relief grant. The business was awarded $600,000 from the Restaurant Revitalization Fund during the height of the pandemic and the federal dollars were used to pay for their outdoor dining space buildout and a few months of wages.

But the restaurants were never profitable and never even broke even, Phillips says, despite several pivots including revamping the menu. The owners conceived of their restaurants before the pandemic hit and their plans revolved around daytime business and nearby office towers that never materialized. As the price of the average taco stayed flat over the three years (in the end, costing $4.50 per taco), other costs like labor and goods kept rising, according to Phillips. A few workers say, in hindsight, they noticed the signs: fewer people were being scheduled to work by year three, which required staff to juggle more.

Meanwhile, Phillips is working with Edens to figure out how to pay off what amounts to a few months of back rent, he says. The process of closing is a painful one; the business filing for bankruptcy is not off the table and at the end of the day, he is on the hook for the business’ debt, Phillips says.

Fans of Las Gemelas and Destino mourned their shutters on social media. The La Cosecha restaurants are the latest on a list of local restaurant closures that is already growing less than two months into the year, joining H Street corridor’s Sticky Fingers and Dupont Circle’s Mari Vanna. As for Phillips, there’s one source of solace: he says their other business, Ghostburger in Shaw, is breaking even and lives to see another day.