Business Group Sues Mamdani Over City-Owned Grocery Stores

A New York City business group sued Mayor Zohran Mamdani on Monday over his plan to open five municipally owned grocery stores, arguing the initiative would harm small, immigrant- and minority-owned supermarkets.

The Multicultural Business Coalition, which says it represents hundreds of small supermarkets, filed two lawsuits in New York County Supreme Court. The suits argue that the plan violates the civil rights of smaller businesses, which the group says would be unable to match discounts offered at the city-run stores and "therefore, will be put out of business."

Mamdani proposed the city-owned, subsidized grocery stores during his campaign, which focused heavily on affordability. The city plans to open five stores by 2029, one in each borough, with the first slated for the Bronx in 2027. Officials have said the stores will sell produce, meat, seafood, dairy and other staples at prices 30% below typical retail, cutting New Yorkers' average grocery bill by 15%, according to Mamdani.

One lawsuit argues the city failed to conduct a "serious analysis" of how the stores could affect smaller neighborhood grocers before launching the plan. The other contends the city lacks legal authority to create the stores.

Mark Jaffe, general counsel for the Multicultural Business Coalition and president of the Greater New York Chamber of Commerce, told CNN that small business owners "cannot possibly compete" with a subsidized supermarket that doesn't pay rent or an electric bill and doesn't buy products at full price.

Mamdani defended the initiative at a news conference Monday, saying he remains "fully confident in both the legality and the importance" of the plan. He noted grocery prices have risen about 30% in recent years and said five city-run stores in a city of 8.5 million people with more than a thousand grocery stores would not significantly disrupt the market. He pointed to existing subsidized groceries on Essex Street in Manhattan and Moore Street in Brooklyn, saying they have "not had a negative effect" on nearby bodegas or grocery stores.

The city's Economic Development Corporation, which oversees the stores, did not immediately respond to a request for comment on the lawsuits Tuesday. A spokesperson told the New York Times on Monday that the city was "evaluating programs and policies to support local grocers," including potential tax abatements, incentives and zoning benefits.