Mayor Zohran Mamdani’s plan to build a $30 million, city-owned grocery store in Harlem next year has stunned supermarket executives — who note that the lavishly-priced project looks like a threat to the neighborhood’s already-struggling grocers, The Post has learned.
Hizzoner unveiled his plan to open the first of five such taxpayer-funded stores – a cornerstone of his campaign last fall to slash food prices for lower-income residents – during a speech on Sunday marking his first 100 days in office.
“I almost fell back when I saw the $30 million number,” Anthony Pena, president of the National Supermarket Association, told The Post. “Even a high end, gourmet store in the middle of Manhattan wouldn’t cost that much to build.”
Avi Kaner, the former owner of New York’s 17-store Morton Williams grocery chain, said “$30 million is an awful lot to spend to build one supermarket.”
Kaner and Pena both said that a typical, 15,000-square-foot store without elevators or escalators costs under $10 million to build.
But it was the location of the store that raised even greater concerns with some executives. The city-owned store will be built on an empty lot next to La Marqueta, a decades-old, city-owned marketplace located under the Metro North railroad tracks at the corner of East 115th Street and Park Avenue.
The problem: The new location is far from qualifying as a so-called “food desert” — a struggling neighborhood where supermarket closures have made groceries hard to come by.
Instead, there are already five grocery stores within a two-block radius of La Marqueta, including Fine Fare, City Fresh and Cherry Valley, according to NSA data. Fifteen stores are located within five blocks of the site.
It’s a “slap in the face” to the city’s struggling independent grocers and “those store owners are furious,” Pena said. He added that it’s hard to cut prices “when your property taxes are going up by 10%.”
Their numbers are dwindling – down to 400 from nearly 500 in 2021 – due to the high cost of doing business in the city and a persistent shoplifting problem, according to Pena.
The city did not disclose the size of the Harlem store. The $30 million represents the capital investment for the ground-up construction of the first store, according to the mayor’s office.
Some 65,000 residents live within a 10-minute walk of La Marqueta and 40% of them are on public assistance, the mayor said in a in a video on X promoting the plan.
The operator of the store won’t pay rent or city property taxes.
“We believe it is fundamentally unfair to use tax dollars — collected from hardworking citizens and existing local businesses — to subsidize unproven, government-run endeavors,” said Carlos Collado, a Bronx supermarket owner who is vice president at the city’s Bodega and Small Business Group.
“These funds would be better spent on infrastructure or direct assistance rather than competing against the private sector.”
Previously, the administration said that its investment in five city-owned grocery stores – one in each borough – would cost $70 million.
The mayor said in a statement, “When corporations control every part of the food supply chain, prices go up, wages stay flat, and workers and customers both lose. That is why we are advancing a public option — one rooted in the belief that our city can and must intervene where the market has failed.
“We cannot accept a status quo where even the most basic necessity — putting food on the table — feels out of reach.”
BSBG’s Collado countered that the mayor should instead focus on lowering costs for businesses and offering incentives for private grocers to expand into underserved areas.
“The administration claims these stores are a response to inflation, yet fails to realize that their own constant mandates, regulatory hurdles, and rising fees are significant drivers of the very inflation hurting shoppers today,” Collado said.
“By using public subsidies, the city creates an uneven playing field,” he added. “Local independent grocers, who have served these neighborhoods for decades, cannot compete with a government entity that doesn’t have to worry about the same bottom-line pressures or tax obligations.”
[Notigroup Newsroom in collaboration with other media outlets, with information from the following sources]
