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A ‘bright’ future for dark kitchens

Blog A bight future for dark kitchens hero

Since the pandemic, we have witnessed businesses being forced to make fundamental changes in order to survive.


The world has become an unpredictable place to live in and the last few years have been challenging to say the least. The pandemic has certainly had a knock-on effect on the way we now live, thanks to the ever-changing restrictions that have been put in place over the last two years. However, new opportunities have arisen to allow room for the hospitality market to thrive and the day-to-day operations have been adapted to meet new consumer interest. 

One of the biggest changes we have seen in the industrial commercial property market is the rise of dark kitchens, also known as virtual or ghost kitchens. This concept is when an industrial unit is set up entirely to deliver food either direct to a customer’s home or a hotel/restaurant premises, as an extension of their on-site kitchen. 

When this model first arrived on the scene, there were many sceptics who did not believe the consumer would meet the cost of this dark kitchen service. However, the rise in this industry over the past few years represents a fundamental shift in consumer behaviour.

Why open a dark kitchen?

Where restaurants can’t open or operate at a full capacity, businesses may not be able to achieve their goals to make a substantial profit. Dark kitchens can help cut costs and boost turnover as it is much cheaper to rent one of these spaces than it would be a traditional restaurant as the units are on a much smaller scale (usually no more than 5,000 sq ft) and they don’t accommodate dine-in guests. As a result, overheads are reduced and tables, chairs and other elements of dine-in ambience aren't required, nor are waiters so salary costs can be pared down to kitchen staff only.

It’s not just restaurants either that are reducing their kitchen space - hotels and private members clubs are doing this too. Many businesses are minimising their kitchen allocations to allow room for more diners into the restaurant and operate a dark kitchen in close proximity to the venue.
Dark kitchens can be a useful short-term experiment for a brand to test a location to see if there is appetite for a larger physical presence. They also provide flexible space for up-and-coming restaurant brands, enabling them to take on shorter leases to offer them time to ‘tap into’ a market while trying to launch and grow their business. 

From a development perspective, dark kitchens can be a much higher site density than the traditional urban logistics model and therefore can maximise value for investors and developers. The sizes really range depending on the operation, from 1,000 – 5,000 sq ft for stand-alone brands, to larger companies taking up to 50,000 sq ft in some locations.

Last mile logistics 

In big cities like London, restaurants are selling an extra 900,000 meals a week via apps including Deliveroo and UberEats, which help to provide effective logistics support through third party vehicle operators to these dark kitchens. Newer players in the market, such as Gorillas, Getir, Weezy and Zapp are based in more densely populated areas and specifically construct their logistics network to reach a targeted amount of people. This last mile grocery delivery model is narrowing the window of ‘just-in-time delivery’. We are expecting an increasing utilisation of smaller hubs across the last mile logistics sector as e-commerce sets delivery targets as hours, and not days. 

Multi-brand cloud kitchens

With an increase in Cloud Kitchen operators such as Jacuna, a multi-let parent company which owns several dark kitchen brands, large buildings can now be divided into multiple units and individual spaces rented to smaller businesses, creating so-called cloud kitchens. Within this type of model, all the brands are cuisine specific and share a large kitchen space, under one roof. 

These types of operations can dramatically help brands to reduce their commercial real estate and labour costs in exchange for higher profit margins per location. 

With all these changes, you may be asking, what is in store for the future? Well, dark kitchens are certainly not the end of the bricks and mortar restaurant business. Many brands still require a physical presence and are simply choosing to expand their horizons by opening a delivery option, to meet the needs of customers today. If anything, it helps the industry live up to its full potential.

There is no doubt that the pandemic accelerated and assisted this change, but equally, we have not seen the return to the traditional model that was widely anticipated. Dark kitchens and dark stores it appears are here to stay. 

An abridged version of this article was published in Property Week on 3 February 2022.

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About the author
Georgia Pirbhai is an associate director in our Industrial & Logistics team she undertakes acquisitions, disposals and provides development advice to investors, developers, and occupiers of industrial and distribution accommodation. To get in touch, email Georgia.Pirbhai@colliers.com


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Georgia Pirbhai

Associate Director

Industrial and Logistics

London - West End

Georgia joined Colliers in 2018 and specialises in the Industrial & Logistics sector undertaking acquisitions, disposals and providing development advice to investors, developers and occupiers of industrial & logistics space and land. 

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