Is Rent Stabilization the real problem?

I was thinking that eventually every storefront in NYC will be a bank, doctor's office, chain retailer, or chain restaurant -- making the city a giant suburb. Perhaps the plunge in rents will enable more interesting stores/restaurants to hang on. I'm not holding my breath though.

You know things are bad when even banks are bailing. The bank which replaced the BBQ on the corner of 8th St and University Place lasted one 5 year lease and has been vacant for ?3 years? since. HSBC pulled the plug on 6th Ave and 14th St and the building replacing it is close to topping out. Citibank closed the 555 LaGuardia branch which had been there forever and moved to a location like 1/4 the size across the street.
https://www.wsj.com/articles/banks-double-down-on-branch-cutbacks-1517826601

Take a look at Ladies Mile. When we opened the office here I'm not sure if there was a single chain here. Now I'm not sure there is any retail which isn't part of a chain.

What you also have is a whole bunch of small footprint retail space which is vacant for a long time, the new business spends hundreds of thousands of dollars on a buildout, and in 6 months to a year is out of business. It's an incredible waste on many levels.

I'll believe this stuff about banks closing branches when Chase abandons plans to replace the Coffee Shop on Union Sq and again gives me a place to buy $7 OJ from grumpy aspiring models at 5am.

This and RS changes are more evidence that the present situation can't extend forever.

But Chase can't even afford the whole place. They have to share it with vegan restaurant "by CHLOE."

At least it appears that across the street the Blue Water Grill space isn't being taken over by Chic-fil-A as rumored. I guess $2 million rent is a lot of chicken sandwiches. Even though Blue Water Grill was in the top 50 grossing restaurants out of 27,000 in NYC, casino and restaurant magnate Tillman Fertitta said "Even though this is one of New York's most successful restaurants, it can't be successful with a $2 million plus rent."

Back in the late 1980s when Coffee Shop opened my friend who was a doorman used to hang his bicycle off the streetlight ""Walk/Don't Walk" sign out front so no one could clip the lock and steal it while he wasn't looking.

Sorry, I apparently understated the issue: it looks like Chase isn't splitting the space with 1 restaurant, but 3:
https://ny.eater.com/2018/10/23/18014944/coffee-shop-space-retail

The retail rents were indeed out of control but they will come down more. I think they are down 15-20 percent in prime locations including Soho. Probably another 15-20 percent before the spaces get repurposed for restaurants, big brand marketing flag ships, experience oriented shops, and even office space.

If you read the article you can see in parts of Soho and the West Village rents are already down 50%. Since in many small buildings the retail space throws off >50% of the income for the entire building these types of precipitous drops can lead to insolvency for the building. This is exactly the same scenario which led to a large number of foreclosures in Soho, East Village, Gramercy and several other areas in the early 1990s. This is how we bought 219 2nd Ave for like $650,000 in ?1993?

What a mess. And I'm not happy to see these places repurposed as restaurants or big brand marketing flagships. These enterprises tend to trample on residents' QOL, especially when there are early morning and unmonitored lines for new merch debuts, and then there are the restaurants who cry poverty and demand sidewalk seating...until 1 am.

30, I see that now. So rents in prime high priced areas down 35-50 percent. Perhaps there is more to come in high absolute price areas.

Jas,
Something which is happening again and again is places getting liquor licences as legitimate restaurants (and some of them actually intending to be legitimate restaurants) but as soon as they open realizing the only way they can pay the rent is to turn into "lounges" and blasting music till 4AM below residential tenants with no proper sound abatements and often improper fire safety/exits for that use.

300,
The good news is that there will be a significantly better chance that small businesses will be able to open and successfully serve neighborhoods long term instead of turning over every year or 2. The bad news is if someone bought a small building for $7 million based on projected rent of $60,000/month, actually rented it for $41,000 and then rent fell to half that what happens? (Actual case for 226 Bleecker St but we'll have to wait to see what happens when Sweet Green stops paying for the final answer).

Or what happens to deals like Brookfield's $31.5 buy of 7 small retail spaces on Bleecker St (especially since increasing Real Estate Taxes fall disproportionately higher on retail spaces)?

30 - that's exactly the case. No one wins except the landlord. How to solve? The SLA is run by the State, and they are far from accountable, especially considering the City's low voter turnout.