After Meteoric Rise, Rapid Delivery Startups In Crosshairs Of Landlords, Lawmakers

Startups promising to deliver groceries in 15 minutes to New York City customers’ doorsteps have grown like a weed into vacant retail spaces, but they are running into fresh problems, from lawmakers to growingly skeptical landlords and investors. 

Companies including Gopuff, Jokr, Gorillas, Getir and Fridge No More are the target of incoming legislation from New York City Council Member Christopher Marte, who has said he will propose a measure preventing the companies from advertising their ability to deliver within 15 minutes, the New York Post reported.

Marte said his legislation will focus specifically on delivery times for road safety reasons, per the Post, incentivizing delivery bikers to break traffic laws and disregard pedestrian safety. The bill is expected to be part of a broader legislative package addressing rapid delivery startups that have proliferated throughout NYC over the past two years.

This legislation isn’t the first time rapid delivery startup apps have faced local political scrutiny. In December, then-Manhattan Borough President Gale Brewer sent a letter to multiple state and city agencies saying that companies were operating as warehouses in areas zoned for retail.

Gorillas and Jokr are among the rapid delivery apps that took advantage of pandemic-era retail rents, signing dozens of leases during the summer and fall, Bisnow previously reported. The companies now combine to occupy between 150 and 200 spaces across the city, Solomon Sharaby, a broker with KSR who has represented Jokr, told the Post. But these apps are also facing questions over profitability.

Despite influxes of venture capital funding, few if any rapid delivery apps have been able to turn a profit, The Wall Street Journal reported. Among the challenged companies is 1520, which signed leases in NYC last year, but shuttered its operations in December.