Month: December 2015

• Yes, just do it

  

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  I have started to meet with developers for my new book – becoming a real estate developer – and I can’t begin to tell you how impressive and inspiring it is to learn about their stories.

  It’s easy to look at someone who is successful and feel overwhelmed by everything they’ve accomplished. But nobody starts at the top of their game (unless maybe they were born with a silver spoon in their mouth). Usually there’s a backstory of sweat and struggle that rarely gets told. As the saying goes: success has many fathers, but failure is an orphan.

  But those are exactly the kinds of things I hope to uncover with this little project. I am less interested in the successes and more interested in the early decisions, struggles, and thoughts that went into making those successes even possible.

  And one thing I’ve noticed is a tendency to just go for it. In fact, when I asked one developer if he had any advice for young aspiring developers, he said: just fucking do it.

  As soon as he said this I couldn’t help but think of my elementary school English teacher who used always tell us the same thing – minus the expletive – whenever we’d ask him something such as, how long should this paper be, should we focus on this or that, and so on. He would always say: What does Nike say? Just do it. No buts. Just do it.

  At the time, I obviously didn’t give this much thought. But the fact of the matter is there’s so much value in doing. And it’s easy to overthink at the expense of doing. What he was teaching us was to have confidence in ourselves that we would figure it out along the way.

  The reason there appears to be a lot of interest in “how to be a real estate developer” is because there isn’t really a set path. You don’t go to school, apprentice for a year under the wing of a developer and then, boom, you’re a developer. 

  Most developers have carved their own paths. They just did it.

  2015.12.30

• Understanding building areas is not as simple as it seems

  Understanding building areas is a fundamental component of real estate and development. But it can actually get surprisingly complicated. Definitions, naming conventions, and measurement techniques vary greatly around the world. 

  To some, “GLA” means gross leasable area. But to others, it means gross livable area. So it’s important to understand what exactly is being measured when someone tells you that that a building is X number of square feet. Are we talking gross building area, gross floor area, or rentable area? Does that number include the below-grade areas or just what is above-grade? To make matters even more complicated, there are nuances to consider depending on whether it’s a residential or commercial building. 

  By now, I am sure you’re starting to see how complicated something as seemingly simple as building areas can get. So let’s talk about some of the basics today. Again, definitions might vary depending on where in the world you area. They might even vary based on conventions you’ve adopted within your particular firm.

  Gross Building Area: Also referred to as Gross Construction Area by some, this is the total area of the building, measured to the outside walls without any deductions. As you’ll see later, some area definitions allow for certain deductions. Gross Building Area is important because it’s a big driver of your costs – specifically construction costs. This is how much building you’re building. But, and this is important, it does not drive your revenue. That comes later.

  Gross Floor Area: This is usually a specific locally-defined measurement convention. It often allows you to deduct certain areas from your gross building area, such as “major vertical penetrations” and below grade parking areas. This number doesn’t directly drive construction costs or revenue (saleable/rentable area), but it’s important because it’s what the city will use to determine important planning numbers such as the building’s density/floor space index and to calculate any applicable levies. It’s also a fairly public number and might be what the brokers are using to calculate, as one example, what certain land sold for on a per buildable square foot basis.

  Net Saleable/Rentable Area: This is a hugely important number because it directly drives revenue. It’s your top line. It’s the amount of space you can collect rent on or the amount of space that you can sell. And unless your revenue exceeds your costs (which you’ve calculated using the numbers above), you’re not going to be able to build. 

  Note: Commercial spaces (at least in this part of the world) often work a bit differently in that there is what is known as a gross-up factor. What that means is that tenants pay rent on portions of the common areas (such as corridors) that fall outside of what is known as their “usable area.” In this scenario, the rentable to usable area ratio (R/U) becomes important. Naturally tenants don’t like paying for a lot of space beyond their usable area.

  This is just a brief overview of building areas. A good architect will make sure that your building area calculations are meeting all local rules and conventions. But as a developer it’s important to know and understand what exactly is being measured and what the “loss factor” of your building is. In other words, how much space is being lost to areas that cannot be sold or rented? Typically, you want to minimize lost space, unless maybe you’re pushing some new concept.

  Anything to add to this building area summary? Do you use different terminology or conventions in your part of the world? Let us know in the comment section below. That would make for a fascinating discussion.

  2015.12.29

• More than just a coffee shop

  

  Today’s blog post is coming to you live from Quantum Coffee at the corner of King and Spadina in Toronto.

  I’m sitting by the window (where I keep running into friends) in a beautiful space that used to be an ugly youth hostel. Nice work Reflect Architecture and MAAST. 

  It’s my first time at Quantum, but I am so intrigued by all that is happening here that I feel compelled to share.

  So Quantum is a coffee shop. The americano I had this morning was quite good. I hope to have another one sometime in the future. But there’s more to this story. 

  Quantum is actually just one leg of something bigger. Attached to it – literally upstairs – is something called BrainStation. And across the street from it is something called The Konrad Group.

  The Konrad Group is a digital agency that does everything from brand strategy to mobile development. BrainStation teaches those same skills to other people via in-person courses in this recently renewed heritage space. And Quantum is the stimulant that helps fuel it all.

  The connective tissue between these 3 businesses, which are all basically owned by the same poeple, is something that I find super fascinating.

  It also feels like the intersection of design, technology, and space (real estate). And as many of you know, that’s what I’m all about.

  2015.12.28

• A year in review — 2015 on Architect This City

  Thanks to this blog, it’s pretty easy for me to go back and look at what I was doing and thinking throughout the year. That’s one of the benefits of writing a daily blog/journal. And as is usually the case, 2015 was a year of ups and downs.

  For my annual ski and snowboard trip with the guys, we went to Banff (Alberta) and Revelstoke (BC). But we got stuck with unseasonably warm weather in the west (the opposite of what’s happening this winter) and I got injured on day 3. That put me in the emergency room and knocked me out of snowboarding for the rest of the season – as well as from the gym for a number of months.

  Shortly after that I also got struck with some family health issues. That was pretty scary for a good solid month, but in the end, everything seems to have worked out. What a relief.

  Towards the end of March, I did a brand partnership between Architect This City and Porter Escapes, which brought me to Quebec City for a weekend. That was a lot of fun and gave me the opportunity to be a real flâneur in one of the most interesting cities in Canada.

  In April, I left my real estate development job at TAS and shortly after I joined CAPREIT (TSE: CAR.UN) to help build out their (real estate) development platform. Previously their/our focus had just been on acquiring existing rental assets. But now it is time to build.

  Later this month I also participated in the Toronto filming of a documentary called Waterfront Cities of the World. That was a lot of fun. But come to think of it, I don’t think I ever watched the final video.

  In May, I started lobbying hard for the removal/replacement of the eastern portion of the Gardiner Expressway East here in Toronto. If you’ve been reading this blog since the summer, I am sure you remember this period. With the help of a colleague of mine, I even started a petition that ended up getting presented at City Council.

  But in June, Toronto City Council voted to demolish and then rebuild the elevated expressway along our waterfront. I am still surprised by that. What a shame.

  In July, we (CAPREIT) announced our first joint venture development project. A mixed-use project – 506 rental apartments on top of about 160,000 square feet of retail – in Toronto’s Liberty Village. 

  In August, I went back to Philly to relive my Penn days. I do that every couple of years just to make sure that Bob and Barbara’s is still offering up “The Special.” The Special is a can of PBR and a shot of Jim Bean for $3. It’s famous in Philly, but it always sounds like a far better idea the night before, as opposed to the morning after.

  In this same month I also hit the 2 year mark here on Architect This City. That’s 2 years of getting up every single day and staring at a blank blog post screen and thinking of something insightful to say. 

  The following month on September 11 (I’ll never forget this date), I got laser eye surgery. More specifically, I got custom wavefront LASIK. And today it’s pretty hard to imagine that I used to have to reach for my coke bottle glasses as soon as I woke up every morning.

  Later in September, I also gave a talk at my alma mater, the Rotman School of Management, to a delegation of about 70 urbanists from Portland. It was an honor to be invited alongside rockstars such as Richard Florida and Jennifer Keesmaat.

  In October, I featured a guest post from the former mayor of Toronto, John Sewell. I don’t often do guest posts on my blog, but John had just published a new book and I thought it would be a good way to change things up here. John and I aren’t necessarily on the same page with many urban issues, but we did agree on the Gardiner East.

  For the remainder of October, it was basically just the Jays.

  In November, I spoke at a Product Hunt event focused on real estate + tech. It was incredibly encouraging to see so many entrepreneurs here in Toronto focused on the intersection of real estate and tech. There are lots of opportunities in this space and I am sure that there are many success stories in the making right now. Toronto is the perfect place for real estate + tech innovation.

  And finally, in December, I crossed something off my bucket list and attended Art Basel Miami Beach. I have wanted to go for well over a decade; pretty much since I started studying art history in undergrad. I don’t know what took me so long.

  Oh, I also announced that I was writing a book on becoming a real estate developer. 

  What a year. I can’t wait for 2016. 

  What do you have on your to-do list for next year?

  2015.12.27

• That hustle and bustle

  

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  One of things I love about cities is the hustle and bustle of people. 

  I would rather eat at a busy restaurant than a quiet or dead one. I would rather workout at a busy gym than one with nobody there. And I would rather work in an office or at a coffee shop than work at home by myself. Working at home actually drains me if I do too much of it.

  The reason for that is because I derive a lot of my energy from the outside world. Urban life energizes me. To Swiss psychiatrist Carl Jung, that is the defining characteristic of an extrovert. I am focused on the “outside world of objects.”

  But because of this, I can’t help but slowdown during the holidays. Once the city dials down and the streets become emptier, my mood actually changes. I don’t feel as energized.

  It’s fascinating to think about the connection that many of us have with urban life. Since the first cities were established there has always been some kind of centralized place, market, or agora (in the case of ancient Greek cities) where people came together to exchange goods and ideas.

  But one of the most interesting turning points for modern urban life, as we know it today, came in 19th century France with poets and writers such as Charles Baudelaire.

  At the time that Baudelaire was active, Paris was undergoing Hussmannization. It was being transformed from a medieval city with cramped narrow streets into a modern metropolis of broad avenues.

  And essential to these new streets and urban spaces was the flâneur. At the time, the flâneur was an important literary and artistic figure. He was a man about town. A man of leisure. An urban explorer in the new modern metropolis.

  Here is how Baudelaire defined the flâneur in his Painter of Modern Life:

  The crowd is his element, as the air is that of birds and water of fishes. His passion and his profession are to become one flesh with the crowd. For the perfect flâneur, for the passionate spectator, it is an immense joy to set up house in the heart of the multitude, amid the ebb and flow of movement, in the midst of the fugitive and the infinite. To be away from home and yet to feel oneself everywhere at home; to see the world, to be at the centre of the world, and yet to remain hidden from the world—impartial natures which the tongue can but clumsily define. The spectator is a prince who everywhere rejoices in his incognito.

  One of the central themes at the time was that of anonymity. The modern city had grown to such a scale that a paradox had emerged. Despite all its density and physical proximity, urban life had an isolating effect. It had become easy to just be a number in an ephemeral crowd.

  But fascinating to me is this idea that urban life – with all its ebbs and flows – could bring “immense joy” to the flâneur. In fact, the very definition of a flâneur was someone who did nothing. They weren’t capitalists on the pursuit of new material possessions. Their sole focus was urban life and nothing else.

  And while most of us probably don’t routinely wander around our own cities as tourists without purpose, I suspect that many of us can appreciate the impact that urban life has on us. I know I do. It gives me energy.

  2015.12.27

• [Video] Interview with designer Marcel Wanders

  I just got home from Christmas dinner and I am so full that I can barely keep my eyes open. So rather than attempt to write something insightful, I am going to share a 2 minute interview with designer Marcel Wanders.

  [youtube https://www.youtube.com/watch?v=w78Bjfscii0?rel=0&w=560&h=315]

  It’s a short piece, but he covers some interesting topics such as his office culture and the value of Amsterdam for their creative process (specifically the city’s openness and tolerance).

  Regular scheduled programming will resume tomorrow. 

  And sometime before the end of the year I’m going to do a summary of 2015 on ATC and make some predictions for 2016. I haven’t really done the prediction part before, but I think it would be a good practice to start.

  Until tomorrow 😴

  2015.12.26

• Merry Christmas from post-tribe Toronto

  

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  Merry Christmas and/or happy whatever you happen to celebrate around this time of year.

  Hopefully things have slowed down for you all and you’re relaxing with family and friends either at home or somewhere on vacation. I’ll be doing that here in Toronto and making pancakes for breakfast, because that’s what I like to do on Christmas morning.

  If you’re in the market for some long form reading material while you relax, I recommend you check out an article in The Walrus called, After the Troubles. It’s by Toronto-based planner Joe Berridge – who is a partner at Urban Strategies – and it’s the story behind his team’s Belfast City Centre Regeneration Strategy and Investment Plan.

  It’s a fascinating and entertaining read, and there are lots of comparisons between Toronto and Belfast. Here’s a little taste:

  “IT WOULD BE HARD to conceive of two cities more different than Belfast and Toronto. One old world, one new; one grand, one utilitarian; one barely ticking over, one growing like topsy. And of course, one tribal, the other the epitome of post-tribe. Belfast is 96 percent white—forget about Catholic-Protestant, that’s the critical urban statistic. And yet it’s important to remember that Toronto itself was once the largest Orange town in the world. (Wikipedia asserts that every mayor of Toronto since its founding was an Orangeman until Nathan Philips, a wonderful Jewish mayor, was elected in 1954.) Even the current mayor, John Tory, draws his name from a bunch of brigands and royalist cattle thieves in the Irish backcountry.”

  I spent a bit of time in Belfast when I was working in Dublin (2007) and so it was particularly interesting for me to read about his assessment of the city. Like Berridge, I found the city eerily empty during off-peak times. But it’s an architecturally rich city and a fascinating city for urbanists because of all that has happened.

  Though now we are talking about “after the troubles.” Things are progressing. And that strikes me as a positive thought while I make my pancakes on Christmas morning.

  2015.12.24

• For the love of Brutalism

  Brutalism is an architectural movement that most people, other than architecture nerds, hate. Derived from the French words for raw concrete – béton brut – Brutalist architecture is characterized by its use of exposed concrete and its imposing fortress-like qualities.

  Most people find it too cold, sterile, and impersonal. But this 99% Invisible episode perfectly sums of where I think we sit with this era of building:

  “Back in the 1960s, Victorian style buildings were considered hideous and impossible to repair. We were tearing batches of Victorians down to erect big concrete buildings. But some Victorians were saved—and today, some of them are considered treasures.
  

  Concrete architecture now finds itself at an inflection point: too outdated to be modern, too young to be classic. And a small, but growing band of architects, architecture enthusiasts, and preservationists, would like us to just wait a bit and see.

  Maybe, with a little time, we’ll come around to love these hulking concrete brutes.”

  Concrete can be a wonderful building material all on its own. I mean, just look at the work of Tadao Ando. 

  But all concrete is not created equal. Here is a taxonomy of concrete textures that was also part of that same 99% Invisible episode:

  

  I say all this because if we believe that Brutalist architecture has no value then we are likely to believe that it doesn’t need to be preserved. And that may very well be the case for some Brutalist architecture. But if history is any indication, some or much of it may also be considered beautiful one day.

  Most cities have a rich history of demolishing (or almost demolishing) buildings and neighborhoods that today we would (or do) treasure. Which tells me that we’re not always very good at figuring out what has value or will have value in the future.

  So maybe some of those brutes are worth a second look.

  2015.12.23

• The benefits of sharing — what real estate could learn from tech

  One of the reasons I decided to start blogging was because I saw how open the tech community had become – with respect to sharing their ideas and experiences – and I thought that the same thing could and should be done in real estate, as well as in city building more broadly.

  But in many ways, the real estate industry is the antithesis of the tech industry. We are slow moving and secretive of our ideas. Now, some of this is driven by fundamental differences in terms of how these two sectors operate. It’s a lot easier to test and iterate on your ideas in tech than it is with actual bricks-and-mortar. But I still think about ways in which we, in real estate, could be pushing the envelope.

  As one example of what I’m talking about, take Union Square Ventures in New York. They call themselves a “thesis-driven venture capital firm”, which means they come up with a framework and core set of ideas, and then use those to drive their investment decisions.

  You would think that these frameworks and ideas would be pretty sensitive. I mean, they are the core drivers of their business. But their entire website is actually set up around sharing and collaborating – with the public – on these ideas. Here’s a screenshot:

  

  Each topic is something they are “thinking about” and something they want to make an investment in (or already have). Fascinating.

  Many of you, I’m sure, would argue that there are risks to doing this. But there are also benefits, some of which are driven by collective intelligence. By sharing their ideas and hypotheses with the public, it helps to evolve their thinking. After all, their investment thesis is not a static thing. It grows over time.

  But in addition to this, it also makes it abundantly clear to their customers (entrepreneurs) what they believe in and what they look for. And I am sure this helps them with deal flow. More and more customers aren’t just “buying” a product, they are also “buying” a philosophical underpinning and belief system.

  Can you imagine a real estate firm doing something like this? I can. But it’s not happening yet, as far as I know.

  2015.12.22

• Coworking, coliving, and an old architecture school project

  Coworking spaces are big business.

  One of the biggest of those companies is WeWork. As of last month (November 2015), the company had raised close to a billion dollars from investors like JPMorgan Chase, Harvard Management, and Benchmark Capital, and was valued at $10 billion. (Remember though, this is in the private not public markets.)

  If you’re unfamiliar with coworking spaces, check out this post from The Spaces. It’s a great demonstration of how beautiful these spaces can be.

  All of this is interesting because it speaks to the changing nature of work. There are a lot of people freelancing, participating in the “online gig economy” and working on new ideas. And in many of these cases, they don’t want or need traditional office space and/or they want the community that many of these coworking spaces afford – both offline and online.

  But it’s not just the office that is changing. It’s also potentially living spaces. Since 2014, WeWork has been talking about their new coliving concept, WeLive. The idea here is to combine smaller living spaces with larger common areas and create an overall live-work community. And they are not the only ones thinking about this.

  Below is a building section of what this might look. It’s from a Vornado Realty presentation. They are working with WeWork to deliver their new WeLive concept in Crystal City, Virginia.

  

  It’s so interesting to see this concept come to fruition. Back in 2008 when I was in architecture school, I worked with a classmate of mine and designed a modular coliving apartment building. It was called the Philly Flex Dwelling and it worked like this:

  

  The idea here was to start with standard floor plates and use a structural exoskeleton to minimize interior columns. This way you could insert whatever prefabricated modules you wanted and also re-purpose the structure should you want to change the building’s use in the future. 

  This is not that dissimilar from what was originally proposed for One Bloor West here in Toronto. Though the goal there was column-free retail spaces. 

  The yellow spaces are the shared common areas and the remaining spaces are the residential living “pods.” We also designed a “solar skin” that was perfectly tuned to the building’s orientation and location in Philadelphia. The idea here was to maximize winter sun (for heating) and minimize summer sun (to keep the building cool).

  That was a fun project to work on.

  2015.12.21