Da Haaf Restaurant in Scalloway is to close down following a recent growth in competition and high running costs.
The eatery, situated within the North Atlantic Fisheries Centre, has proved a popular choice for many over the years.
However NAFC director David Gray said the restaurant was struggling to cover its overheads.
He refused to be drawn on whether jobs would be lost, insisting staff were still going through a legal consultation process. The restaurant will remain open until that process has been completed.
“Unfortunately, Da Haaf Restaurant has not been viable despite the quality of its food and service, which resulted in very positive feedback from its customers. The business is not making enough money to cover its costs,” he said.
“The competition has increased, there are more eateries in Lerwick and Scalloway, with various places that have opened up in recent times. Also the costs of running a catering establishment have increased.
“The staff of Da Haaf restaurant would like to take this opportunity to thank all of its loyal supporters over the years, both local and visitors to Shetland, for their custom.”