Select Group to invest S$10m to open 20 cloud kitchens in Singapore

SINGAPORE-BASED Select Group, which operates various food and catering concepts, on Friday announced plans to invest S$10 million to open 20 cloud kitchens here over the next five years, as it expects demand for food delivery to remain even after the Covid-19 pandemic.

The cloud kitchens will be leased out, but some of Select's brands will also take up units within the cloud kitchens, said Vincent Tan, Select's managing director.

He added: "Within Select Group itself, we witnessed a 200 per cent surge in delivery orders for many of our brands in 2020 compared to the year before. With swift expansion plans in place for Select Cloud Kitchen, we are confident of meeting the future demand and strengthening our foothold in this space."

A cloud kitchen is a centralised kitchen where food operators can rent space to prepare food specifically for delivery. Such operators typically generate sales through online channels and do not have a physical storefront.

Select said it will focus on opening in "densely populated heartland areas", starting with Jalan Mas Puteh in Clementi and Tampines Mart. The cloud kitchen in Jalan Mas Puteh is already operational, while the one at Tampines Mart is expected to be operational by May.

Other locations in the pipeline, according to Select's website, include Braddell, Yishun, Jurong West and Bedok.

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Mr Tan said focusing on locations with high population densities will differentiate Select from other players. Aside from location, Select also touts what it says is one of the lowest rents in the market.

A presentation deck for the Tampines Mart cloud kitchen shows rents ranging from S$3,500 a month for a 137 square foot (sq ft) space, to S$5,500 a month for a 285 sq ft unit.

Among the group’s brands that have taken up units at the cloud kitchens are Hill Street Coffee Shop, Hong Kong Sheng Kee Dessert and Pho Street.

Select today runs more than 20 brands.

They include events catering concepts Stamford Catering and Select Catering, as well as household restaurant names such as Peach Garden.

It employs “thousands” of staff and is present overseas, in Malaysia, Indonesia and Vietnam.

The group started out in 1991 as a tingkat - tiffin carrier - service by Mr Tan and his family. It later ventured into catering, followed by restaurant operations.

In 2004, Select listed on Singapore Exchange’s Catalist board.

Then, about five years ago, it was taken private by a consortium led by Temasek Holdings-linked Dymon Asia Private Equity, and which included Mr Tan and his brother.

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