NYC business owners revolt over Mamdani’s government-run grocery stores: ‘Doomed for disaster'

New York City business leaders and bodega owners rallied Wednesday just steps away from the future site of one of Mayor Zohran Mamdani's city-run grocery stores, arguing the plan will force local businesses to close.

The Multicultural Business Coalition, which is made up of 50 chambers of commerce representing multicultural businesses, filed two lawsuits in state court on Monday challenging Mamdani’s plan to open five government-owned supermarkets with subsidized grocery offerings.

On Wednesday, leaders within the coalition gathered alongside bodega owners outside the American Deli Mini Market Corp, in Harlem — which sits across the street from the confirmed Manhattan city-run store location at La Marqueta — to challenge Mamdani’s rollout of the stores, which is slated to begin in late-2027.

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"This is a campaign promise doomed for disaster if it is allowed to go through," Mark Jaffe, president and CEO of the Greater New York Chamber of Commerce, told Fox News Digital.

One of the two lawsuits is a seven-page class-action filed on behalf of "hundreds" of store owners and alleges the opening of the city-run grocery stores would violate the businesses’ civil rights, according to court documents.

"When you use government money discriminatorily, it could be a civil rights violation," Jaffe said, adding, "Shame on the [Mamdani] administration for not working with small businesses, but trying to hurt them and being heartless in their statements."

The second suit asks the courts to permanently block the operation of "the municipal grocery stores, in absence of undertaking necessary studies and analysis," a move that has historically barred large retailers — such as Walmart — from entering the Big Apple.

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Under Mamdani’s plan, the five grocery stores will offer a core basket of items priced 30% below the average retail prices sold at other businesses.

"Under the model, the City will own the land and cover overhead costs like rent and construction. A private operator, selected through a request for proposals, will manage daily operations and be contractually required to pass savings directly to customers on a core basket of everyday staples," an April news release stated.

However, the pricing and subsidization of business expenses for the city-run stores puts the operators at an unfair advantage, according to Jaffe.

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"It’s unfair," Jaffe told Fox News Digital. "[Small business owners] who have to pay their Con Edison bill, their real estate taxes, their fines and full price for food cannot compete."

"The end-game here would be to help [small businesses owners] and not just subsidize 30% off from suppliers who are not lowering their prices for the city," he continued. "Our tax dollars are buying groceries at full price, so we can sell them at 30% off up the street — that’s not going to feed enough struggling people."

Jaffe added that he believes the solution could lie in the establishment of a task force focused on mitigating the damage to local businesses in the surrounding areas of each store.

"The only reason [small businesses] are going to be hurt is because [Mamdani] is taking tax dollars to put [them] out of business," Jaffe told Fox News Digital. "It's wrong. We want a task force. We'll show you how to feed struggling people."

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As part of the rollout of the city's government-run grocery stores, Mamdani established the NYC Groceries Task Force to "convene city agencies, industry experts and local small business owners to guide implementation," the administration said in a statement to Fox News Digital.

Additionally, the city launched an OPEN Task Force to "identify and eliminate unnecessary red tape and reduce fines and fees for small businesses," according to Mamdani's office.

The sentiment surrounding the stores' impacts on local businesses was echoed by Elvis, the owner of American Deli Mini Market Corp, identified only by his first name.

"If [Mamdani opens this store] in front of [my] business, [I’m] going to go out of business," Elvis said through a translator at the press conference. "[I] pay a lot of taxes and this is not fair."

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Mamdani has long defended his plan for government-run grocery stores, saying Monday that he is "fully confident in both the legality and the importance of our initiative."

"The administration plans to open one city grocery store in each borough by the end of the Mayor's first term. There are more than 1,000 grocery stores and supermarkets and over 10,000 bodegas and corner stores across New York City," Mamdani's office said in a statement to Fox News Digital. "There are more than 1.4 million New Yorkers currently struggling with food insecurity. The five city grocery stores will not have a significant impact on the hundreds of grocery stores or the thousands of bodegas across the city."

However, Jaffe insists the opening of the city-run, subsidized stores will do more harm than good to the surrounding businesses and will ultimately drive the minority entrepreneurs out of the Big Apple.

"It is doomed to fail. History shows us that communist supermarkets have empty shelves," Jaffe said, adding, "We have better ways to help feed the struggling people. Please listen, Mr. Mayor. Don't keep campaign promises that will hurt people."