The Azorean adventure is over. But it wouldn't be a trip to Europe without some sort of post about street dimensions.
So here's a primary retail street in downtown Ponta Delgada — 6.7m from building face to building face, or about the size of a standard two-way drive aisle in Toronto.
And here's the narrowest street/lane that I came across on the island. I couldn't find a street name, but it did have utility meters on it, and it was about the size of a residential building corridor.
We also stumbled upon quite the street party in this same area. There's a lot happening in this photo.
I did also manage to find a memory card reader for my camera at a Continente (supermarket) along the way. So make sure you're following Globizen's Instagram page.
Regularly scheduled programming will resume tomorrow.
These are photos of the Blue House — and its siting — in the civil parish of Capelas on the island of São Miguel. Designed by the Portuguese firm Atelier Backlar, the house was completed in 2023 and now serves as a popular short-term rental in the Azores. If you'd like to take a look inside and/or book it, here's the Airbnb listing. Right now it's going for over C$1k per night.
But what's even more interesting about this property is that it once belonged to Bianca's maternal great-grandparents. Her great grandfather was a whaler and so its location on the water beside the Porto das Capelas was naturally ideal for days in the office. This is also where Bianca's grandmother lived prior to emigrating to Toronto in the 60s.
Like a lot of real estate, there's an emotion-filled story that explains why it's no longer in the family. But I do think it's nice that the architects chose to preserve some of the existing walls of the previous house (which they describe as an abandoned ruin on their website). I also think it's cool that it has become one of the most noteworthy examples of modern architecture on the island.
Let's call this the second-best outcome.
After seeing this beautiful 6-storey and 21-unit social housing project in Lyon, I decided to retweet it and share the fact that we recently had a site under contract in Toronto with the intention of doing a very similar build. We wouldn't have been able to do the same outdoor spaces at the corner, but it was going to be 6 storeys and without any setbacks. The overall dimensions appear to be similar.
However, in the end, we had to drop the site because the margins were simply too thin. I was disappointed. Of course, some people responded to my quote retweet by calling this an example of developer greed. But once again, I don't think most people understand how development economics work. If the margins are too thin it, among other things, means:
It's going to be hard/impossible to raise capital and finance the project
You might be better off buying a "risk-free" government bond instead
That unexpected situations could sink the project (i.e. you lose money)
To give a specific example, let's assume that your expected base case rent at the time of occupancy is $4.75 psf. This would mean that if your average suite size is around 600 sf (which ours was), you would need a face rent of about $2,850 per month.
But what happens if you're off by only $0.25 and your face rent for this same 600 sf apartment is now $2,700 per month at initial lease up? $150 per month may not seem like a big deal, but it is. If you capitalize this income at something like a 4% rate, you will find that it becomes material.
This is what I mean by "the margins are too thin." And it's similar to any other professional not wanting to take on a job because they might lose money or because it's "not worth their time." It's about managing risk and understanding the opportunity cost of taking on such a project.