After 4 generations, Kelly's Seafood in Northeast Philadelphia is closing

For nearly seven decades, the Kelly family has been in the restaurant business in Northeast Philadelphia.

What began in 1958 as a small luncheonette run by Brett Kelly's father and grandfather — selling ham sandwiches for a quarter — eventually grew into Kelly's Seafood, where four generations of the family have worked.

With its family atmosphere, famous snapper soup and cozy dining room, Kelly's became a beloved neighborhood gathering place.

"One customer put on Facebook that we're like the 'Cheers' of Philadelphia, because people come in, like, 'Hey!'" Brett Kelly said. "Everybody knows everybody."

Now, the restaurant in the Bustleton neighborhood is preparing to close at the end of the month.

General manager Brett Kelly said the immediate reason is deeply personal: his twin brother and "right-hand man," Brian Kelly, was diagnosed with stage 4 melanoma and can no longer work the long hours the restaurant requires.

"He's used to working six days and 70 hours a week. Now he's six," Brett Kelly said of his brother, Brian.

Brett Kelly added that they had always discussed that if one of the two brothers was ever unable to work, they would know it was time to close.

But Brett Kelly said the business had already been facing growing pressure for years.

He said Friday and Saturday nights can look more like Thursdays did before the pandemic, and that the late-night crowd has largely disappeared.

"The 9 o'clock and after crowd, business is gone," Kelly said. "I never had to close the kitchen at 9:30 on a Friday night until this year."

At the same time, the cost of running the restaurant has climbed sharply.

Kelly pointed to king crab legs as one example. Before the pandemic, he said they cost roughly $18 to $19 a pound. Now, he said, the price is about $48 a pound.

"I can't sell it," he said. "I had to take it off the menu."

Ben Fileccia, with the Pennsylvania Restaurant and Lodging Association, said those pressures are being felt across the industry by family-owned restaurants. 

"Across the commonwealth, they have been struggling," Fileccia said.

Fileccia said he was not surprised by the July 2026 findings from the National Restaurant Association showing the average cost of operating a restaurant rose sharply between 2019 and 2026 — a staggering 36%.

"All prices have gone up. Labor has gone up. Cost of goods has gone up. Rent has gone up," Fileccia said.

Fileccia said restaurant margins have become so tight that even a single setback, such as a severe snowstorm that keeps customers away, can be enough to push a struggling business toward closure.

Fileccia also pointed to credit card swipe fees as another growing expense.

As more customers moved away from cash, he said restaurants increasingly absorbed fees charged by credit card companies on each transaction, adding another cost to an already difficult operating environment.

For the Kelly family, the financial challenges are only one part of the story, as they move to support Brian Kelly during a difficult health struggle. 

Brian's son, Thomas Kelly, is part of the fourth generation that has held the business together. 

"It means something when your family's name is on the front," Thomas Kelly said. "You have generations of families doing the same thing."

Kelly's Seafood is scheduled to serve the public for the last time Aug. 30. The family plans to hold a private gathering for staff and family the following day, on Aug. 31.