Uber’s Kalanick Pours $130M Into Ghost Kitchen Properties
In making his new ghost kitchens startup CloudKitchens, ex-Uber Co-founder Travis Kalanick has become something of a real estate mogul, buying up 40 properties in two dozen cities, according to The Wall Street Journal.
The properties, including closed restaurants, body shops and warehouses and are in cities including Portland, Oregon; Las Vegas, Nevada; Columbus, Ohio; and Nashville, Tennessee. The concept behind CloudKitchens involves renting out space to businesses to prepare food for delivery.
The price tag on those properties came out to over $130 billion, according to WSJ, citing a review of public property and corporate records from Reconomy, the commercial real estate database.
The WSJ analysis linked various limited liability companies to Kalanick’s CloudKitchens parent, City Storage Systems.
Realtors said they were aware of Kalanick’s efforts to buy up properties, though the exact amount of places he’d bought has not been reported before WSJ’s efforts. Kalanick is gambling on the current rush of interest in food delivery because of the COVID-19 pandemic, which has bolstered mobile-based deliveries as a mode of getting food and other everyday things.
Delivery-only kitchens have been around for years, though, attracting investor interest over the prospect of trying to replicate the success of the co-working industry and subleasing real estate.
However, some landlords are wary of renting to these types of companies, fearing unproven business models and hesitant to back projects that might need complex rebuilding jobs on their properties.
With its disruption of traditional restaurants and their dine-in models, the pandemic threw a wrench in the battle between Kalanick and his former company Uber’s Eats Delivery Hub concept. As the world began to reopen by early summer, Uber exited the industry, saying it didn’t need to own real estate.
Aside from that, Kalanick’s buying ventures ran into issues, too, with some properties needing extensive repairs.