Author: Brandon Graham Donnelly

• Solar power as art

  

  The past week has felt more like a London winter, than a Toronto one. It has been mild, rainy, and gray. So right now feels like an opportune time to write about this solar-powered light/art piece called Sunne. Created by Marjan van Aubel, the light has been designed to hang right in front of a window using two simple cables. There’s no need for an external power source, because it has an integrated battery that harvests sun during the day. The light then automatically turns on at sunset, and has the ability to simulate some pretty stunning sun experiences.

  Now, if you happen to live in a place with a roof that gets good sun exposure, I suppose you could just install a bunch of solar panels and use them to generate power for cool-looking things in your home. But if you don’t have the ability to do that — for instance, maybe you live in a multi-family building — then this feels like a clever and extremely beautiful way to harvest some amount of sun. I’m sure that, eventually, we’ll have building facades that can generate a meaningful amount of solar power, but until then, you’ve got devices like Sunne.

  P.S. For what it’s worth, I’ll take cold, snowy and sunny, over mild, rainy and gray, any day of the week.

  Image: Sunne

  2023.12.28

• Living vs. just visiting — do these two things require different built environments?

  

  Many years ago I was in a community meeting talking about a proposal we had to add retail uses adjacent to a park. Residential was the highest and best use, but we were excited by what retail could do for the project and area. We were imagining something like a Parisian cafe where everyone would sit facing outward toward the park.

  Much to our surprise, the community was vehemently opposed. And when we eventually asked who had been to Europe and sat outside in a nice cafe, the response we generally got was, “yeah, we have, and it’s obviously nice there, when on vacation. But that’s Europe. It won’t work here and it’s not appropriate for the area.”

  Hmm. This raises all sorts of interesting questions. But for today, let’s ask this one here: Why is it that some people choose to live in places that are so different than the ones they visit when on vacation?

  Is it because we, as humans, want fundamentally different experiences when we travel? i.e. We want to escape from our current reality. “Oh look how novel this is.” In this case, I guess you could say that our markets are fairly efficient and people are getting the kind of lifestyles that they truly want, both at home and abroad.

  Or, is it because, for a variety of reasons, we’ve created rules and obstacles that force certain built form outcomes? We think the other ways won’t work. I often find myself in this latter camp, meaning that when I travel, I at some point end up thinking: “This is a good idea. I want to both move here immediately, and steal this idea and bring it back to Toronto.”

  How about you?

  Photo by DAT VO on Unsplash

  2023.12.27

• The Boxing Day move

  We moved into our new apartment today, so I don’t have a lot to say other than that moving is a good way to remind yourself that you have too much stuff. I was in my last place accumulating for over a decade.

  I try my best to live minimally and there is certainly something liberating about this mindset. But there is also a part of me that is a collector at heart. (A great number of our boxes are filled with things like books.)

  It also turns out that Boxing Day, or some other time over the holidays, can be an excellent time to move. Streets are calm. Buildings are quiet. The email firehose is off. And nobody else wants to move at this time.

  Most importantly, though, it affords you some time to get your life back together. And that’s exactly what I’ll be doing for the rest of this week.

  2023.12.26

• Automated checkouts

  I did something this week that I don’t often do: I shopped for (non-grocery) things in person. Like, in a physical store. So I recognize that this isn’t entirely bleeding edge. Still, I am thoroughly impressed by the self-checkout process at Uniqlo.

  All of their items now include RFID tags, which means you don’t need to scan anything. You just place your basket or items down, and then everything shows up automatically on the screen. Done. The most frictionless checkout that I have ever experienced.

  

  My understanding is that this was done more for supply chain management and that it is now possible because the cost of these tags have come down to something like a few cents per unit; but the added benefit is that they have greatly improved checkout throughput and the overall experience.

  This has been a part of the promise of RFID tags for many years. And this week I experienced it IRL for the first time. It was awesome. Now I hope this same experience comes to grocery stores in the near future.

  2023.12.25

• Merry Christmas

  For those of you who celebrate, I wish you a Merry Christmas.

  This year has been a hectic year for many; certainly for those of us in real estate. I’ve heard a lot of people tell me that they’ve “never worked so hard only to feel like they have accomplished so little.”

  Looking back at what I wrote on the first day of this year, I was wrong about many of my 2023 predictions. I thought the interest rate hikes would be over by the first quarter of the year and that the spring would bring greater optimism for new development projects.

  This was partially true — we did see some buoyancy around spring — but then further increases over the summer really quashed the pre-construction condominium market and overall developer sentiment for basically the rest of the year.

  I also thought that we would see distress within the industry in the first half of the year. That didn’t quite play out, as far as I can tell, and I now think that 2024 will be the year for this.

  All of this said, I do feel that 2023 was a highly productive year. I’m proud of what I accomplished both personally and professionally. And this holiday season, I’m looking forward to slowing things down, spending time with family and friends, and catching up on some life management.

  Hopefully you are all able to do something similar. Merry Christmas, everyone.

  2023.12.24

• Are shared e-scooters now dead?

  

  I first wrote about Bird, the electric scooter company, back in March 2018. At the time, they had just raised $115 million and their pitch was that they were going to solve the last-mile mobility problem. This is a real problem, and so lots of urbanist-type people, including myself, were excited. I then rode my first shared scooter in 2019 in Lisbon, and I had a ton of fun. I wrote: “Now I know what all the fuss is about.”

  But it wasn’t all puppy dogs and ice cream. People started getting annoyed by the clutter that dockless scooters were creating in our cities (see above photo). Safety also became a great concern, and so they started getting viewed as a nuisance. Toronto never allowed them (despite my insistent blog posts) and Paris — which had arguably become the scooter capital of the world — banned them in early 2023.

  Now there’s this: Bird announced this week that it has filed for bankruptcy. The once unicorn, which had its stock halted back in September because its market cap fell below $15 million for too long, needs cash. According to FT, they have about $3.25 million the bank, but they have an immediate need for $16.8 million to meet some “financial obligations” in January.

  This is maybe not unexpected. But I think the important question is: Is this an existential moment for micro-mobility and shared scooters (i.e. this is a fundamentally bad business), or is it more of a case that money used to be mostly kind of free, and now it’s not? Either way, I think there’s no question that the latter is going to cause further distress throughout 2024.

  But the question remains: Can shared scooters be a sustainable business?

  My day job is not to be a scooter analyst. But I do think that a number of things are true:

  • Riders seem to really like using electric scooters and so top-line demand continues to grow.
  • There are many headwinds for this business ranging from winter usage to politics.
  • Barring regulation, there appears to be low barriers to entry.
  • Lime has already claimed to be the first micromobility company to post a full profitable year.

  These first and last points are important ones. I believe it’s always going to be easier to get people onto electric scooters and bikes than onto regular bikes; people will generally always choose what is easiest. At the same time, here is a company that has allegedly figured out how to offer this service profitably. Assuming these two things remain true, I think we’ll continue to find scooters in our cities.

  Photo by Gemma Evans on Unsplash

  2023.12.23

• Are short-term rentals really a zero-sum game?

  The prevailing view on short-term rentals right now seems to be this:

  

  That is, it’s viewed as a zero-sum game between residents and tourists. There are only so many homes within a city, and so if any of them are to turn into short-term rentals, then it is a direct reduction in the supply of available long-term homes. This can also happen very quickly given the asset-light nature of Airbnb and the fact that these spaces aren’t usually purpose-built.

  It is for this reason that many cities have enacted strict short-term rental laws that basically only allow you to rent out your principal residence when you’re not around or if you happen to have extra space. In the case of New York, you have to be physically present when the dwelling is being rented, and so the use case is exclusively “I have extra space for you.”

  Either way, the basic idea is to stop people from removing homes from the long-term market. I do, however, find it curious that reductions in housing supply seem to be generally viewed as bad, but that increases in housing supply are often met with skepticism. Doesn’t housing supply work in both directions? Why aren’t more people clamouring for new homes to be built?

  Where my head is at on this issue is that I don’t see it as a zero-sum game. I believe that there should be rules and regulations around short-term rentals, but that they shouldn’t stamp out all use cases other than “here’s an air mattress in my living room.” At the same time, I think we should be viewing this as an opportunity. Clearly we need more homes, more hotels, and more short-term rentals.

  It’s only zero-sum if we make it that way.

  2023.12.22

• Canada is growing a lot

  This week it was announced that Canada’s population grew by approximately 430,000 people over the last quarter (+1.1%). And that it represents the highest population growth rate of any quarter since the second quarter of 1957. Even more impressive, though, is the fact that in the first 9 months of this year we have already added over 1 million people in total. This beats all full-year periods since Confederation in 1867!

  Here’s what all of this starts to look like visually:

  

  The unfortunate side of these records is that it is coming at a time where we’re, perhaps counterintuitively, building a lot less new housing; which is to say that construction starts are declining. In fact, I was on a call this week where people who examine development and construction costs all day were predicting a 5-6% decline in hard costs in the Toronto region next year. And this is a direct result of fewer new projects getting started.

  Broadly speaking, this is how things tend to work in real estate development: there are heavy lags between changes in demand and changes in supply because of how long it takes to build new buildings. But what’s happening right now is more than this. Interest costs are impacting everyone. And investor interest in pre-construction homes has softened significantly, demonstrating how much our industry relies on individual investors. Many projects cannot go.

  What I ultimately think this is going to do is exacerbate our current supply-demand imbalances. Meaning that when the market does come back — and it of course will — it’s going to come back with a vengeance. And that’s because it is going to need to catch up to all of the new demand that is accumulating as we speak.

  2023.12.21

• Pink glow

  Here’s a potentially hypothetical question.

  If you were in the market for a 3-bedroom penthouse, and its 1,100 sf wraparound terrace with skyline views just so happened to have an enormous neon-like sign above it, would you consider this to be a feature or a bug?

  

  The sign does turn off at 11PM, but before then, it creates this awesome/lovely pink glow on the terrace. My sense is that this will be fairly divisive. You’re either going to love it or you’re going to hate it. Which side are you on?

  Let me know in the comment section below.

  2023.12.20

• Spatial videos

  If you have an iPhone 15 Pro (and iOS 17.2), you can go into Settings -> Camera -> Formats and turn on a setting called “spatial video.” It will then enable this (excerpt from Om Malik):

  Spatial video is a mixed-reality video format that allows videos to record the depth and spatial information of the scene, and when you play it back, you get a more immersive, three-dimensional (3D) experience. The iPhone 15 Pro utilizes its main lens and the ultra-wide lens to capture the depth and spatial information of the videos. The spatial videos are captured at 1080p, 30 frames per second, and use the HEIC format.

  What you can then do is watch your videos on something like an Apple Vision Pro. It’s not going to be exactly perfect right now — given that the Vision Pro display is over 8k and the above is 1080p — but it will give you an indication of what’s to come for photography, video, and many other use cases.

  Some examples.

  As a regular consumer, this might allow you to capture videos from a trip and then more fully relive the moments once you’re at home. And as Om argues in his post, this will inevitably change photography/video. Because how we consume media, impacts how and what we capture.

  If you’re in the business of selling real estate to people, you can also imagine this set up having a profound impact on virtual tours. Because now you have something that’s pretty damn close to reality, if not eventually indistinguishable. Why even go in person until you have to?

  Of course, all of this will depend on whether Vision Pro actually sees widespread adoption. But if the technology is as good as everyone who has tested it seems to think, then surely there will be at least some initial users who find immediate value.

  And if that is the case, it opens the door for the masses. To once again quote Om: “It is not hard to be excited about the possibilities.”

  2023.12.19