Hiya, new member, first time posting...
When I asked an employee at Terrace Cafe if the restaurant was closing they told me it would go down for refurb for a short while like a month or two, but that it was not closing down.
Originally I had heard they were going to reclaim the land and use it as queue for the new Kong ride, but now it seems that the Terrace restaurant will instead stay, but be rethemed for Skull Island. That would put the new entrance to JP just beyond the restaurant, closer to the ride and Camp Jurassic.
Given that JP island already has Burger Digs, a pizza window, and the Watering Hole, it wouldn't be the end of the world to lose Terrace to Kong. And more importantly, this gives Skull Island something more substantial than just a ride and gift shop.
For me personally, I love the Terrace Cafe. It's nice to get something besides just burgers and it's cool to get those big ears of corn with the husks on them. So I'm glad to hear it's sticking around, regardless of what island it's officially a part of.