SoftBank-Backed Ghost Kitchen Operator Shuttering 3 New York Facilities

When restaurants struggled during the height of the pandemic, ghost kitchens stepped in. But now, restaurants are backtracking on commitments and letting ghost kitchens fade away.

In the latest blow to the fledgling industry, ghost kitchen company Reef Technology is closing all three of its New York facilities, laying off 53 workers, according to a Worker Adjustment and Retraining Notification filed with the New York State Department of Labor.

Miami-based Reef, which operates ghost kitchens and delivery fulfillments out of trailers in parking lots, plans to shutter three facilities by Sept. 30 — one facility in the Bronx, one in Manhattan and one on Long Island.

The largest facility is 2 St. Anne's Ave. in the Bronx, in the parking lot of a FreshDirect delivery center. Twenty-four Reef employees are on the chopping block there. The other facilities affected are at 77 W. 24th St. in Manhattan, where eight office workers are set to be laid off, and 30 Enterprise Zone Drive in Riverhead, Long Island, where 21 staffers are on the way to losing their jobs.

Reef Technology couldn't be reached for comment by email, phone or LinkedIn. A message to its press contact line received an automatic reply that the email "is no longer valid."

The company was founded as ParkJockey in 2013 as a parking technology company. After a 2019 investment from SoftBank, it changed its name to Reef Technology as it began to explore other uses for empty parking lots.

Its pivot to ghost kitchens in trailers took off during the pandemic, scoring a deal with fast-food giant Wendy’s to open as many as 700 ghost kitchens.

But occupying a space that couldn’t be defined as a food truck, delivery service or restaurant meant regulatory and permitting difficulties. The company also experienced safety issues, including three instances of propane-fueled fireballs in its kitchens, difficulties securing labor and challenges getting utility hookups.

Reef isn't the only ghost kitchen to struggle for survival in the postpandemic economy, as consumers returned to restaurants and ordered via traditional delivery companies like DoorDash and Grubhub. Startup Kitchen United announced plans to shutter in December. A month earlier, Uber co-founder Travis Kalanick’s ghost kitchen startup CloudKitchens went through a round of layoffs.