Today we’re going to peel back the layers of Mayor Zohran Mamdani’s planned socialist supermarkets.
The first will be at a city-owned site in East Harlem. Here’s the description he gave at a press conference of how Mamdani Markets will work:
“The city will subsidize a core set of staples. A private operator will run the store, but they answer to the standards that the city will set. These standards include requirements that at our stores, bread will be cheaper, eggs will be cheaper. … And workers will be treated with dignity.”
Deputy Mayor for Economic Justice Julie Su chimed in: “The city owns this land and we are going to use it to make food cheaper.”
Sounds simple. It’s not.
In exchange for free rent from the city’s Economic Development Corporation, a to-be-selected store operator will sell “a core basket of staples” at a discount, Su said. Besides eggs and bread, what will be in it?
Probably fruits, vegetables and grains. But many of these staples are already cheap. An oatmeal breakfast is about 30 cents, or $1 if you add an apple, raisins and nuts. Bags of carrots sell for 99 cents. “A can of Goya black beans cost $1.50 at a Fine Fare supermarket on Malcolm X Boulevard,” The City reported.
Kids, however, prefer Lucky Charms, Kraft mac-n-cheese and Coke. So do many parents. Will Mamdani subsidize — as federal food stamps do — the processed foods that fill up many shopping carts and increase the risk of diabetes?
Oranges could be a staple, but orange juice should not; it’s high in sugar and not nutritious. People love juice, though. At the mayor’s press conference, speakers repeatedly said the store would offer what shoppers want to buy, not what they should buy.
Red meat is expensive, bad for the environment and presents health risks. Will Mamdani discount its price?
Price caps address one problem but cause another: shortages.
If Mamdani sells bananas for 39 cents a pound, entrepreneurs would buy them up and re-sell them elsewhere. To deter this, the mayor would have to limit purchases of subsidized items.
Re-sellers could evade these limits by making repeated trips to the store. That, along with high demand from consumers, would lead to long lines and a poor shopping experience.
Self-checkout would reduce those lines, but also jobs. When Mamdani says “workers will be treated with dignity,” does that allow for replacing them with machines?
Like Mamdani’s affordable housing plan, his supermarket plan has a conflicting goal: union employment. “The workers in this store will enjoy union-level standards,” Su said. The city will subsidize not just the store’s consumers but its workers as well.
Will that money come from EDC’s budget? It’s a self-funded agency, so any money it gives to city-owned supermarkets will come at the expense of its other efforts.
Speakers at the mayor’s press conference spoke of food deserts, but The City’s reporters counted four grocery stores, numerous fruit stands and many bodegas near the planned Mamdani Market site, La Marqueta, on Park Avenue between East 117th and East 118th streets.
The speakers also harped on nutritious food costing more than processed food. But on a per-serving basis, that is not true.
The argument they made repeatedly is that a subsidized grocery is needed because the private market has failed to make affordable, nutritious food available in East Harlem. I disagree.
The real affordability problem is not high prices but low incomes: Many families cannot afford nutritious or processed foods. And processed foods outcompete healthful fare because they are tasty and convenient to eat.
What we’re thinking about: Did Council member Chi Ossé cry wolf when he claimed an eviction in his Brooklyn district was a result of deed theft? Even Attorney General Letitia James, who has made deed theft a priority, called the case a family dispute over ownership. Ossé’s protest — he and three others were arrested — could cause others’ claims of deed theft to be treated with skepticism. Send thoughts to eengquist@therealdeal.com.
A thing we’ve learned: Gov. Kathy Hochul tweeted that President Donald Trump would have to pay the pied-à-terre tax, but added, “If he wants to regain his residency as a New Yorker, whatever property he has will not be subject to this.”
That’s not quite true. If Trump moved to, say, Hochul’s hometown of Buffalo, he would still have to pay the pied-à-terre surcharge on his Fifth Avenue apartment.
Few people would move back to their New York City homes to avoid the surcharge, because then they would have to pay city and state income taxes.
Elsewhere…
It’s hard to build housing on wetlands. But you knew that.
What you might not know is that four years ago, the state legislature expanded freshwater wetlands protection. Regulations to implement the change added more than 1 million acres of designated wetlands.
However, state regulators screwed up: They claimed the expansion wouldn’t have any negative impacts on the environment but failed to explain why. As a result, this month a judge invalidated the expansion.
How could wetlands protection be bad for the environment in any way? Perhaps the Department of Environmental Conservation considered that question not worthy of an answer, but the judge felt otherwise.
He was probably right. Most policies have drawbacks, and they are not always obvious. In this case, the Business Council of New York State argued that “billions of dollars in taxpayer investment in water, sewer and stormwater infrastructure were threatened” by the wetlands expansion, LoHud reported.
The more obvious impact will be on housing development. Under the new regs, parcels as small as 7.4 acres (down from 12.4) can qualify for protection.
It’s not clear if the judge was swayed by the industry’s point that the wetlands expansion would threaten Gov. Kathy Hochul’s housing goals. Hochul apparently wasn’t moved by that argument either: Her administration fought the lawsuit and is expected to appeal the ruling.
Closing time
Residential: The most expensive residential sale recorded Thursday was of Unit 723 at The Astor, 235 West 75th Street, for $7.75 million. Kyle Egan, Katherine Gauthier and Will Rivera at Douglas Elliman had the listing.
Commercial: The most expensive commercial transaction was $65 million for the 81,172-square-foot mixed-use property at 206 Kent Avenue in North Williamsburg. After a foreclosure auction was planned, G4 Capital took title from Cornell Realty Management and Yitzchak Tessler. The Real Deal reported in 2020 an $84 million loan for the development project.
New to the Market: The highest price for a residential property hitting the market was $35 million for unit 16 at 1040 Fifth Avenue on the Upper East Side. Serena Boardman of Sotheby’s International Realty has the listing.
Breaking Ground: The largest new building permit filed was for a proposed 56,295-square-foot, 68-unit, mixed-use project at 497 East 166th Street in Morrisania. Mohammad Badaly filed the permit on behalf of Anthony Verrelli.
— Matthew Elo