(Bloomberg) -- Portillo’s Inc., a beloved Chicago restaurant chain, is looking outside Illinois for growth as population declines drive business elsewhere.

The seller of Italian beef sandwiches and Chicago-style hot dogs, founded in Illinois almost six decades ago, says its sweet spot for new store growth is the US Sunbelt. This year, five of seven new Portillo’s locations are opening in Florida, Arizona and Texas. 

In 2023, “at least the majority -- if not the vast majority” of new locations will be in those three states, Chief Executive Officer Michael Osanloo said in a phone interview. 

Chicago’s dine-in restaurants have been slower to bounce back after Covid-19 with people remaining cautious about returning to work and eating indoors, Osanloo said. 

“There are certain cities, metropolitan statistical areas, that are approaching it differently,” he said. “It could very well be urban versus less urban. We’re definitely seeing some different behaviors in markets across the country.”

He said that Portillo’s restaurants in Florida are doing well from a dine-in standpoint, and that certain Arizona cities are seeing an influx of people -- a boon for the chain’s expansion. Meanwhile, the nation’s third-biggest city, with about 2.7 million people, has seen the number of residents dwindle in recent years. The population dropped 1.8% between April 2020 and July 2021, Census Bureau data show.

“It’s a punch in the face,” Osanloo said of that population loss in Chicago. “And it’s not like people aren’t building restaurants in Chicago. So it’s a dog fight.”

Recently, other companies have announced their departures from the Chicago area, citing increasingly difficult business conditions and crime. Those include hedge-fund manager Ken Griffin’s Citadel, which is headed to Miami. Boeing Co. is opting for Arlington, Virginia, after two decades in Chicago. And construction-equipment maker Caterpillar Inc. is moving its headquarters from the Chicago suburbs to Texas.

Portillo’s, now based in Oak Brook, Illinois, started as a hot-dog stand in the Chicago suburb of Villa Park in 1963, and has since grown to more than 70 locations in nine states. The company’s website touts that it has “become a brand synonymous with Chicago.”

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