The secret behind the world’s fastest-growing restaurant operator starts in the parking lot.
Reef Technology, the Miami-based company known in the restaurant industry for its compact, delivery-only kitchens, is also one of the world’s largest parking operators. It owns and manages thousands of lots around the globe, providing ideal sites for its ghost kitchen “vessels” that are about the size of two parking spots.
That’s one reason Reef has been able to expand so quickly, attracting big investments and big-name brands along the way. It currently has more than 300 kitchen vessels worldwide, but it expects to have “thousands” by the end of the year for an overall increase of 10x, said Reef Kitchens President Michael Beacham.
“We are statistically the fastest-growing restaurant company on the planet,” he said in an interview with Restaurant Business. “I don’t think anyone can touch us.”
Some of that growth will come from its landmark deal with Wendy’s. Reef will open 700 Wendy’s vessels across the U.S., U.K. and Canada over the next five years, making it the burger chain’s largest franchisee.
The company reached out to Wendy’s about the prospect of a partnership years ago, when the ghost kitchen model was still new. An eventual test of eight units in Toronto proved “eye-opening,” and led to what Beacham said is the largest development agreement ever for a restaurant brand.
Wendy’s is one of the more than 80 brands on Reef’s roster—a mix of global chains, regional concepts, local independents and virtual brands. Its two top partners, in fact, fall into that last category. Man Vs. Fries, an off-premise-only french fry concept that started as a popup in the Bay Area, has grown quickly through Reef and is now the company’s No. 1 sales generator.
“We have him throughout our entire system, and it’s like lightning in a bottle,” Beacham said. “Wherever we put it, it does well.”
No. 2 is MrBeast Burger, the upstart concept backed by YouTube celebrity MrBeast that could make its own claim to being the fastest-growing restaurant company in the world.
Reef’s modular vessels can house up to eight brands at once for maximum efficiency. As one brand grows, it might bump lower-performing vessel-mates into other locations. And the most successful, like Wendy’s, Popeyes and Man Vs. Fries, drive enough business to stand alone, Beacham said.
Like other ghost kitchens, the company’s central pitch is that it can help a restaurant expand for significantly less than what it would cost to open a brick-and-mortar. A single vessel costs about $150,000 to get up and running, Beacham said, and generates an average of $1.5 million in annual sales.
The key to driving those sales is putting vessels close to lots of potential customers. And because of its large network of owned or managed parking lots, Reef can get that kind of prime urban real estate for cheap.
“We don’t need to be Times Square on Broadway,” Beacham said. “That’s one of the reasons why the brands see us in a very positive light as to how they extend their reach.”
And its development strategy is not limited to parking lots. It recently opened a multibrand ghost kitchen in Raleigh-Durham International Airport and is also partnering with hotels as a room service provider.
By the end of the year, Reef expects to be working with more than 100 restaurant companies, Beacham said. And whereas in the past, it had to approach those restaurants itself, these days, it’s the other way around.
“There are very few large brands that we’re not already in discussion with,” he said, “and most of them have come to us.”