Month: February 2020

• A study on expanding housing options in Toronto

  The City of Toronto is currently studying ways to increase housing options/supply and planning permissions in areas of the city that are designated as Neighbourhoods in the Official Plan.

  These are areas that are sometimes referred to as the “Yellowbelt”, because they are seeing very little intensification and, in a number of cases, actually losing population. (They’re also colored yellow in Toronto’s land use map.)

  Ultimately, the goal is to encourage more “missing middle” type housing forms; housing that is denser than single-family homes but smaller in scale than say mid-rise housing like Junction House.

  Here are a couple of interesting charts from the City. Based on Toronto’s Official Plan, “Neighbourhoods” make up 35.4% of the city’s land area.

  

  In Toronto’s Zoning By-law, the “Residential” category makes up 47.1% of the city’s land area.

  

  Digging deeper, 31.3% of Toronto’s total area is zoned for only detached houses — which would mean no missing middle type housing. But 15.8% of the city’s total area is already zoned to permit other types of low-rise residential buildings, such as duplexes and triplexes.

  

  So why isn’t more of that happening?

  As we’ve talked about before on the blog, the problem is that it is exceedingly difficult to make the math work on projects of this scale, which is why most developers don’t want to do them. The web of bureaucracy that you need to navigate in order to build anything in the city is also imposing for non-developers (and developers really).

  But to be a developer, I think you need to be an optimist. So I am going to remain hopeful that this study — and the pilot they want to do in Ward 19 — will result in a streamlined solution for housing of this scale.

  Images: City of Toronto

  2020.02.29

• A catalyst for Westside development — but not yet

  A new 280 acre park is currently under construction in an old quarry on the westside of Atlanta. It’s called Westside Park. When it opens this spring (that’s at least the target), it will be by far the largest park in the city. But already there are concerns that this investment in new public space could be triggering “rapid gentrification” in the surrounding area.

  So earlier this month, the mayor’s office issued an executive order that put in place a 6-month moratorium on all new construction permits in the communities surrounding the park. The order read like this: “…refuse to accept new applications for rezonings, building permits for new construction, land disturbance permits, special use permits, special administrative permits, subdivisions, replattings, and lot consolidations for non-public projects.”

  The objective is to avoid displacement. And since new development means change, this is a way to stop change. (Don’t you just hate when things go and change?) The problem, of course, is that a moratorium on new housing doesn’t stop change and it does nothing to address the desire to live next to this new amenity. It only stymies the supply of new housing to meet this demand. (It’s also incongruent with the park investment being marketed as a “catalyst for new development.”)

  In fact, Joe Cortright (of City Observatory) and Jenny Schuetz (of the Brookings Institution) have both argued — either directly or indirectly — that the above move could actually increase displacement in the surrounding area; because the moratorium on new housing could simply redirect demand toward the existing housing stock. The order does seem to suggest that you can still renovate an existing property.

  I wonder if any studies have been done on the externalities associated with temporary housing supply moratoriums. If so, I would be interested in reading them.

  2020.02.28

• Thoughts on the coronavirus

  This is an excellent article by James Hamblin about the coronavirus. He believes, along with many epidemiologists, that the disease (COVID-19) is unlikely to be contained, and may become endemic:

  The Harvard epidemiology professor Marc Lipsitch is exacting in his diction, even for an epidemiologist. Twice in our conversation he started to say something, then paused and said, “Actually, let me start again.” So it’s striking when one of the points he wanted to get exactly right was this: “I think the likely outcome is that it will ultimately not be containable.”

  But here’s the irony. It is unlikely to be containable because, comparatively speaking, the disease isn’t as fatal as other coronaviruses. In James’ words: The virus is deadly, but not too deadly.

  As of right now, the fatality rate is believed to be less than 2%. SARS and MERS, on the other hand, were highly fatal to humans. H5N1 (avian flu), which emerged in the 90s, had/has a fatality rate of about 60%.

  One of the problems with COVID-19 is that, for many people, the symptoms are mild or even non-existent. And that is precisely why it has been so difficult to pin down. If it affected everyone equally and as severely, then it would be far more containable.

  But I am the furthest thing from an epidemiologist, so you should probably just go and read James’ article over in The Atlantic.

  John Hopkins University also has this live map showing total confirmed, total deaths, and total recovered. At the time of this post, the fatality rate looks to be about 3.4%. But if you believe that many people are asymptomatic, the denominator is probably understated.

  Naturally, we are all taking precautions, doing what we can to make our communities safe, and trying to quash this virus. And that is what we should be doing. At the same time, I found James’ article helpful at putting things into perspective.

  2020.02.27

• The future of central London

  The Centre for London has just published an interesting report called, Core Values: The Future of Central London. Like most city centers, Central London (or the Central Activities Zone as the report calls it) punches well above its geographic weight.

  Central London occupies about 0.01% of the UK’s total landmass, but is responsible for about 10% of its economic output. It represents about 2% of London’s total footprint, but is responsible for about 40% of total employment and about 45% of economic output.

  Here’s another interesting stat:

  

  From 1961 to 1983, the residential population of CAZ boroughs in London fell from about 2.5 to 1.7 million. And things really didn’t begin to turnaround until the late 1980s. It took until 2018 for the population to return to 2.5 million. Makes me wonder: How concerned do you think people were in the late 1970s about housing affordability in Central London?

  To read the full report, click here.

  Chart: Centre for London

  2020.02.26

• Field of infinity

  I am a big fan of the work of Reuben Wu. He is, among many other things, a landscape photographer. But he explores and documents his landscapes in highly creative ways. In one of his latest projects — Field of Infinity — he photographed the Bolivian landscape at night and used a modified drone (plus a slow shutter speed) to draw light objects in the night sky. The results are incredible. Here is a short video about that trip and his work. (Note: He is an ambassador for the XT Camera System.)

  2020.02.25

• Working from somewhere

  

  From the outset, people have been predicting that the internet would become a decentralizing force for cities. That is, technology would allow us to spread out and work from anywhere — perhaps from a small mountain town in the BC interior. While working from home (WFH) and working from anywhere (WFA) does appear to be on the rise, it hasn’t made cities irrelevant. (US Census data from 2018 estimates that only about 5.2% of Americans work entirely from home.) In fact, the “new economy” seems to have made superstar cities, such as London, seemingly even more important. It has concentrated economic activity; so much so that we’re searching for ways to spread out income and wealth more evenly.

  But could it be that the technology simply wasn’t there yet? Fred Wilson posited on his blog today that right now might be video conferencing’s moment. Between not wanting to travel (coronavirus, carbon footprint, time, etc…) and advancements in the actual technology, companies such as Zoom are changing the way people and companies engage over long distances. It is happening in our offices. And come to think of it, there are probably a bunch of meetings that I could and should switch over to Zoom. I’m not yet convinced that it will become a decentralizing force for cities. But it does seem to be empowering less travel and more flexibility.

  Photo by Nastuh Abootalebi on Unsplash

  2020.02.24

• Economies of agglomeration in London

  The media tends to describe agglomeration economies — one of the benefits of big urban areas — as being entirely serendipitous. Minimize travel. Maximize chance encounters at the local coffee shop. And then all of a sudden patents will go up and new startups will emerge. That does that happen, I’m sure, but there’s a bit more structure to a lot of these encounters. Economies of agglomeration is not just about serendipity. It is about the benefits of and the decision to concentrate economic activity.

  

  Last week, a think tank in the North of England (IPPR North) published a report outlining, among other things, job creation and productivity across England. Based on these metrics, London and the South East dominate, with “productivity” in London being by far the highest. Almost half of England’s new jobs over the last decade were in these two regions. Above is a chart from the Financial Times. The trade-off is wealth and income inequality. And the report does look to how the government could address this centralization of power and wealth.

  Like Singapore’s low fertility rate, this is an instance of leaning into the wind.

  2020.02.23

• Have three, or more if you can afford it

  At the beginning of this year, Singapore expanded its preschool subsidies and improved its support for assisted reproduction and fertility treatments. The goal: more Singaporean children. According to the World Bank (via the Wall Street Journal), Singapore has one of the lowest fertility rates in the world at about 1.14 children per woman as of 2018. This is down from about 3 in 1970, when the government was actually worried about the opposite problem — too many children.

  

  Of course, this trend is not unique to Singapore. This is generally the way the winds are blowing in the developed world. Young people are spending more time on education, career, and travel. And they’re delaying marriage (or not getting married). On top of this, family-sized housing has become fairly expensive in most big cities. The fastest solution is to ramp up immigration, but many countries, including Singapore, have concerns about what this does to the “national identity.”

  So there seems to be a preference for throwing money at the problem and promotional material with slogans like this one: “Have three, or more if you can afford it.”

  Chart: WSJ

  2020.02.22

• Electric vehicle startup Canoo launches first wave waitlist

  

  LA-based startup, Canoo, is trying to rethink urban transport and, more specifically, how people use and consume electric vehicles. They aren’t planning on launching in Los Angeles until next year, but here’s what is apparent so far.

  (1) The vehicles (pictured above) are far more utilitarian in their design — though still attractive. The focus does not seem to be on creating objects of desire, which is how cars have historically been sold.

  (2) The interiors are more living room-like in their seating configurations. This makes them feel less like a car and more like public transit (or a prom party limo).

  (3) The plan is for these vehicles to be available through a commitment-free monthly membership, as opposed to through a traditional lease or purchase option.

  These features are the sorts of things that many have been predicting would happen. But they remain signals for the future of the “car.” They are also perfectly well suited to autonomy.

  If you’d like to join their waitlist, you can do that here. I just did and apparently I’m #5967 in line. I have no idea when they hope to launch in Toronto, but who doesn’t love a good waitlist? The illusion of scarcity can be a powerful motivator.

  Update: My position in line has improved to #229 because of all of the “referrals” generated by this post. Canoo has done a good job using their waitlist system to generate exposure and solicit early customer feedback.

  Update: #46.

  Image: Canoo

  2020.02.21

• Q4-2019 high-density land report for the Greater Toronto Area

  Bullpen Consulting and Batory Management published their Q4-2019 land insights report for the Greater Toronto Area today. According to the report, there were 36 high-density apartment land transactions in Q4-2019. The average sale price was about $111 per buildable square foot and Bullpen estimates that these future projects — assuming they go condo — will sell for just under $1,000 psf on average.

  But that’s blended across the entire GTA.

  Looking at the core of Toronto (former City of Toronto boundaries), the average price per buildable square foot was about $187, which represents a year-over-year increase of 28%. There’s also a premium for mid-rise sites. Bullpen pegs the average price of a mid-rise site in the City — unzoned but with an active development application — at about $231 pbsf. These numbers will obviously translate into much higher condo/apartment prices.

  If you’d like to download a copy of the report, click here.

  2020.02.20