Sacramento’s first ‘ghost kitchen’ provides new opportunity for dining entrepreneurs

Kru executive chief and partner Billy Ngo is hoping that Sacramento’s first ghost kitchen, The Line at Elvas Virtual Kitchens, will help his high-end Japanese restaurant rebuild its delivery and to go business.

The Line at Elvas Virtual Kitchens are virtual in name only. They are actual commercial kitchens, 11 in total, each 200 square feet, in a building on Elvas Avenue near Sacramento State.

So far, Line at Elvas owners said they have rented out three of the kitchens, to Kru; Nash & Proper, which offers Nashville inspired fried chicken from three food trucks and two retail locations; and Gondo Fusion, a food truck offering Cuban inspired food.

But the concept isn’t limited to those already in the dining industry. Ghost kitchens are also an opportunity for those to enter the business without running a full-on restaurant or purchasing a food truck.

The first three kitchens are expected to open by early October and The Line’s general manager Adam Ono said the hope is that all 11 kitchens will be rented out by the end of the year.

Ngo said the delivery and take-out business helped East Sacramento-based Kru survive during the worst of the pandemic when restaurants were ordered closed or only had limited seating in 2020 and 2021.

Kru’s take-out strategy

But Ngo said Kru had to give up that business when the restaurant finally fully reopened in the later part of 2021 because it was too difficult handling restaurant customers while also dealing with the delivery and to-go orders.

He said the restaurant experience would have suffered if he did not give up the delivery and to go business.

“We care about the dine-in customer first,” said Ngo. “People make a reservation and wait to get a table. They are sitting down and we want to give them a quality experience.”

Now, Ngo hopes he can do both, serving restaurant customers at its location at 3135 Folsom Blvd, and the delivery business at the ghost kitchens.

Ngo said two chefs will be placed in the micro-kitchen that will serve DoorDash, UberEats, GrubHub and other food delivery services, though it will be a more limited menu.

“The ghost kitchen,” he said, “is a way to offer a fine dining experience in the restaurant and still allow customers the option for delivery and to go-orders.”

Customers will also be able to place to-go orders on the ghost kitchen’s own app, but will have to pick up the food in person.

Beer garden next?

Eventually, Ono said the ghost kitchens will also contain a beer garden aimed at Sacramento State students next door, allowing them to drink beer and eat food, ordered from the ghost kitchen’s own app.

Sacramento is behind the curve when it comes to ghost kitchens. The kitchens started becoming popular in major cities before the pandemic but prospered even more after stay-at-home orders forced people out of restaurants.

One major ghost kitchen start-up chain, Los Angeles-based CloudKitchens operates ghost kitchens across 17 different U.S. cities and is headed by Travis Kalanick, the co-founder and former CEO of Uber.

Sacramento slow to the trend

Given Sacramento’s vibrant food scene, it’s unclear why the city didn’t have a ghost kitchen complex before the pandemic , said Kamiar Nejad, one of three investors in The Line at Elvas Virtual Kitchens.

Nejad speculates investors didn’t think Sacramento was a big enough market.

He said the COVID-19 pandemic, which fueled the popularity of DoorDash and other food delivery services, convinced him that the slightly more than a half-acre site on Elvas Avenue, that once housed a blinds store, would be a viable spot for a ghost kitchen complex.

He and two other investors, Sutter Capital and Dan Carlton, president of Mark-Three construction, paid $1.45 million for the land, county records show.

Nejad would not say how much it cost to renovate the building containing the kitchens.

A kitchen runs $4,000 a month

Each kitchen rents for $4,000 a month, plus the restaurant owners have to pay three percent of gross recipients.

Cecil Rhodes II, the owner of Nash and Proper, said the ghost kitchen complex will enable him to expand his business without a large cash outlay.

“It a win win,” he said, “because I don’t have to fork out a hundred grand to remodel a full restaurant or $150,000 for a new food truck.”

Rhodes hopes to keep labor costs under control by only having several cooks in the ghost kitchen.

Ghost kitchen investor Nejad said the ghost kitchens also could be a more economical opportunity for an up-and-coming chef who wants to open his or her own restaurant but doesn’t have the capital to do so.

He said that the complex would work with the chefs on marketing to give then viability for their first food venture.

This story was originally published September 10, 2022 at 5:00 AM.