One of Toronto's go-to Italian joints is closing after more than a decade of service, leaving many locals to mourn their favourite spot for "Italian food, crafted with love and integrity."

The news of Lil' Baci's closure took Leslieville residents by surprise and many started speculating why the popular restaurant would be shutting down: Skyrocketing rent prices? Increased commercial tax rates? Gentrification?

Mark Bacci, one of Lil' Baci's owners, put a rest to the rumours by weighing in on Facebook.

"We're still just as busy to be honest," he explained, "but as some of you mentioned, the cost of doing business is crushing margins, hence we've decided to change concepts."

Bacci noted that the minimum wage hike had resulted in most restaurant suppliers raising their prices, in turn forcing restaurants to raise their own prices.

"This bothered us a lot, as we didn't want to push the cost onto the customer and we recognized we were moving away from our core business of value," he wrote.

"Our new concept will reflect more our business philosophy, which centres around value."

The new restaurant will be more in line with Annabelle Pasta Bar, says Bacci, which he also co-owns along with Bob Coffee Bar at 44o Christie St.

"It's trying times for small businesses in the city for sure, but it also forces business owners to get creative, to rethink the status quo," he said, "which is a big part of what we've done."

The Yonge and Eglinton outpost of Lil' Baci closed just a few months ago, but both Annabelle and Bob Coffee Bar are still thriving at Davenport and Christie.