Bad economic policy is subtly "evil", by way of allocating finite resources inefficiently. Usually this is unintentionally done by not appropriately taking second, third, ..., nth order effects into account.

They destroy grocery stores that offer variety in every neighborhood they operate in. They offer worse service and people put up with it because the rest of New York is subsidizing them through taxes.

The margins for groceries are objectively thin. The only way to provide food at lower prices is to provide a worse good or service, eg. less variety, less quality, less availability, etc. You will see all of these outcomes in NYC, if anyone even accepts the bids to begin with.