The cost of fast grocery delivery is being felt in neighborhoods across the city, Brewer said. Many micro-fulfillment center locations darkened their windows so that pedestrians could not peek inside, earning them the nickname “dark shops”. Instead of shoe stores or gift shops, many street corners now have black windows and delivery bike charging stations.
“This is just the latest assault on this streetscape from this place that we love so much,” said Reverend James Karpen of St. Paul & St. Andrew’s Methodist Church on the Upper West Side. “I just want to tell my neighbours: you don’t need to do your shopping in less than 15 minutes. You don’t need it so fast, not to the point of sacrificing the beauty of our neighborhood.
Small business owners in the bodegas and local grocery sector have appealed to City Council to determine whether businesses should be allowed to compete with them for real estate space and customers.
There is also a concern about rapid growth. Working with Beta NYC, a civic design and technology firm, Brewer’s office documented 115 micro-fulfillment centers across the five boroughs, up from 25 in December 2021. The office said 81% of those centers are operating in outside of zoning codes.
“It is absolutely unacceptable that ‘shady stores’ are effectively operating off-limits warehouses in trade corridors,” said Councilor Julie Menin, Chair of the Small Business Committee. “The retail space on the ground floor is meant to be dynamic and interactive.”
The council sees the fight as a way to protect small business and bodega owners from being invaded by venture capital-backed tech retail. Board members recalled previous failures of city government to regulate app-based companies that have arrived in New York to popular reception.
“New York City has chosen to take the ride-hailing app and let medallion holders go underwater,” Brewer said. “We can’t let the same happen to immigrant and locally owned stores, which have less access to banking, credit, capital and technology than app-based businesses.”
A real estate professional admitted that while the app-based delivery store model was accepted by commercial property owners desperate for reliable rent during the throes of the pandemic, the business model is questionable, especially with an onslaught of political pressure on the horizon.
“A lot of them were semi-pop-ups to fill vacancies and collect revenue,” said Timothy King, managing partner of SVN CPEX real estate, a commercial brokerage firm. “The jury is still out on the long-term viability of the business model. They are up to date.”