Major ghost kitchen operator Reef Technology has allegedly had all of its New York City locations shut down after health officials found the company was operating without necessary permits and foregoing several health and safety requirements.
The New York City Department of Health and Mental Hygiene told Restaurant Business the kitchen operator was breaking "numerous" requirements at "multiple" locations. Reef operates pod-like units situated in parking lots where it churns out delivery and takeout orders placed digitally. It offers items from dozens of fast-food brands, including Wendy's, Nathan's Famous, and 800 Degrees Pizza.
However, the company denies shutting down its kitchen pods due to violations. In a statement to Restaurant Business, Reef denied violating any rules and said the permits for its pods were temporary and that those locations were shut down voluntarily when the permits expired. According to the publication, the ghost kitchens are now operating from brick-and-mortar locations in New York City.
A spokesperson for the health department told Business Insider the company has "agreed to cease operations for the time being" while it seeks compliance.
The company seems to be facing issues over long-term regulation of its unique business model, which doesn't fall in the category of brick-and-mortar restaurants nor food trucks. Miami, for example, amended the city code this spring to allow for Reef's operation, while a former employee of the company told Business Insider that bigger cities were slower to approve permits. According to the publication, Reef frequently operates on the basis of temporary permits which are easier to secure and come with fewer restrictions.
"There's no long-term permitting strategy," a former operations manager told Insider. "They're essentially hiding."
When reached for comment, Reef confirmed to Eat This, Not That! it was currently operating from fully-permitted brick-and-mortar locations. "We continue to work collaboratively with regulators on ways to permit our innovative model which seeks to reinvent urban spaces in a way that improves cities and neighborhoods with mobile structures," a spokesperson for the company said.
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