Micro Real Estate

What is a Ghost Kitchen?

Ghost kitchen

Sometimes also called a cloud kitchen or virtual restaurant – a ghost kitchen is a restaurant without seating or a storefront. The ghost kitchen purely operates as delivery restaurant, typically by phone and on meal delivery services like grubhub or UberEats and may marketed as multiple restaurants. Yes, that’s right, you’re favorite restaurant food may be coming from the same kitchen as your least favorite food.

The ghost kitchen can operate out of the kitchen of an existing restaurant put the certified kitchen to more optimal use. To optimize further, since there is not a store front, they can utilize cheaper real estate that is not necessarily in a high foot traffic area like a shopping center. With these optimization steps, it’s possible for a ghost kitchen to provide quality food with less overhead than a traditional restaurant.

Are there a lot of Ghost Kitchens?

UberEats helped launch over 4,000 ghost kitchen around the world, which is a drop in the bucket of the 15 million restaurant around the world, and 700,000 in the United States. So, there’s really not that many ghost kitchens, but in cities with expensive real estate, a ghost kitchen or just kitchen sharing in general for multiple restaurants would make sense. The lower the overhead for any business, the better the business is going to perform (i.e. higher profit margins leads not only to higher profits, but also a larger amount of money that can be reinvested into the company for growth).

Ghost kitchens are a small but growing segment of Micro Real Estate, that is predicted to be a $1 trillion industry by 2030.

Flexibility of Virtual Kitchen

Since there is no store front, there is the flexibility to quickly start up and shut down a new restaurant brand. Websites are cheaper than all the items required for a physical restaurant re-brand (logo on cups, menus, the building, employee attire, etc.), so a re-brand is pretty simple for a ghost kitchen.

If a brand starts to work well, it’s also easy to grow the brand with rented kitchen space in a similar area to the original restaurant, or anywhere that the owner wants to expand. This also could help make deliveries more efficient since someone ordering off of UberEats might not know what ghost kitchen location their food is coming from anyway.

The Shady Side of Ghost Restaurants

The flexibility of ghost restaurant also allows for abusive working conditions. The ability to hide the location of a restaurant means that there is the possibility for unsavory people to create unsafe or unbearable working conditions for kitchen employees.

The difference between a Ghost Kitchen and Food Truck

Clearly, the most mobile type of kitchen is a food truck, but there’s usually only space for one brand in a food truck anyway. There could be a ghost kitchen run our of a food truck, if there were cars that delivered food from the food truck, or if the food truck was able to be small and fuel efficient enough to drive to each delivery spot and make the food on site. That would be a bit crazy, but maybe a solar powered electric van could fit a specialized kitchen for some types of cuisine, or a bio-diesel that could run off the oil from fries – this might be a good idea for the food trucks (“grease trucks”) that sell fat sandwiches at Rutgers University.

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