Brandon Donnelly

Daily insights for city builders, delivered every morning at 6 AM ET. I’m Brandon Donnelly — a Toronto-based real estate developer and founder of Globizen. I’ve been writing here since 2013.

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Author: Brandon Graham Donnelly

  • Kaunas — European Capital of Culture

    So each year Europe runs a program called the European Capitals of Culture. The objective is to celebrate the richness of European culture and presumably drive throngs of tourists to its various locales. They do this by choosing a set of cities, designating them “capitals of culture”, and then running events and programming all throughout the calendar year in those places.

    When the program was created in 1985, it was originally called the European City of Culture, as there was only one city being chosen at a time. In the first year that city was Athens. But the program has since evolved and now multiple cities are chosen each year. For 2022, the European Capitals of Culture are Esch-sur-Alzette (Luxembourg), Kaunas (Lithuania), and Novi Sad (Serbia).

    I was reading about Kaunas in FT this morning and I was fascinated to learn that this city of approximately 300,000 people has some 6,000 modernist buildings. Some are apparently in disrepair, but many remain in good form and, as part of the festival, visitors can book stays in some of the restored ones.

    There is, of course, an interesting story behind these buildings.

    This collection of modernist buildings is the result of a relatively narrow window of time and a specific set of circumstances. Lithuania gained independence from the former Russian Empire in 1918, following WWI and while Russia was busy fighting with itself. But at the time, its capital city Vilnius, which remains the capital today, was mostly occupied by Poland.

    So Kaunas became its temporary capital city from 1920 to 1939, the latter date being when Vilnius was returned to Lithuania. This temporary designation created a tremendous need for new buildings, both public and private, and it just so happened to line up with the flourishing of European modernist architecture.

    Kaunas didn’t get any modernist “icons” from architects such as Le Corbusier, but there’s absolutely nothing wrong with that. Kaunas instead created its own varietal of modernism, one that incorporated elements of Art Deco and one that you could argue is now deeply symbolic of a very important moment in its history: A peaceful period of interwar freedom and optimism.

    Image: Kaunas 2022

  • Sustainable living means living in a city

    The UN’s Intergovernmental Panel on Climate Change (IPCC) has just published its latest climate change report. Available here. As a follow-up to this report, Dezeen spoke with Hélène Chartier of the sustainable urbanism network C40 Cities. And she makes some very good points about the importance of cities in combatting climate change.

    In fact, she goes so far as to say that sustainable living is only really possible, at scale, in cities. Because to live a more sustainable lifestyle, you need the right kind of infrastructure in place. And to have the right kind of infrastructure in place, you need density.

    This crucial point is often forgotten (though never on this blog). If you are truly concerned about climate change, then you should be for urban density. And if you are out there fighting against urban density, then your actions are undermining this global imperative.

    Chartier rightly points out that “architects have a huge responsibility” when it comes to addressing climate change. And this is entirely true. Their job is the built environment. But with all due respect to architects, the problems that need solving are ultimately much broader. Architects can only do so much if they’re hamstrung by dumb land use policies and angry neighbors, among other things.

    This needs to be a coordinated effort. We all have a huge responsibility.

    Photo by Kaspars Upmanis on Unsplash

  • High-rise urban families in Toronto’s CityPlace

    The narrative in this fairly recent FastCompany article about Toronto’s CityPlace neighborhood is that the area was initially planned and built for young professionals who wanted to be close to work and party. But that it has since evolved to become a more mixed residential community. Over time, the young professionals started having children and now the area is filled with a surprising number of urban families. “Hundreds” according to FastCompany. In response to this shifting demographic, the Canoe Landing Campus was recently completed, containing a community center, two public schools, a public park, and childcare facilities. And apparently it was long overdue.

    This is interesting for a few reasons. CityPlace has long been criticized for its planning. Local Toronto lore has been that the area was destined to become a slum. But is that actually playing out? Anecdotally, it would seem that families are sticking around (and being attracted to the area) and that it’s settling in nicely as an urban residential community. In fact, I wonder if CityPlace might be emerging as one of the areas in the city with the highest concentration of high-rise urban families. I quickly tried to find some data on this but couldn’t.

    Something else worth pointing out: One of the objections that you’ll often here when it comes to new development is that there isn’t the infrastructure in place to support it. Where are the schools? Where are the community centers? And where are the hipster coffee shops? Because without these invaluable things, development should be stopped immediately. Now I’m not suggesting that these things aren’t important. But the CityPlace example is yet another reminder that cities and neighborhoods evolve — often in fortuitous ways. The best city building is nimble and entrepreneurial.

  • San Francisco now has autonomous vehicle taxis

    These are two short videos of autonomous Cruise vehicles driving around San Francisco. Cruise, which is owned by General Motors, received a permit from the state of California to operate autonomous vehicles — without a safety driver — in September of last year. In November 2021, one of the cofounders of Cruise took the first ever driverless taxi ride in the company’s history. And on February 1, 2022, Cruise announced that it was opening up to the public.

    If you read the comments on Twitter you’ll see that some people have found these vehicles to be hyper reactive to traffic lights and to do oddly long pauses at stop signs. So I guess they’re not perfect. But oddly long pauses are certainly better than not stopping at all. Either way, this is a big deal. I’m not sure if these are the first unsupervised autonomous vehicles out in the wild, but they are easily some of the first.

    There has been a lot of discussion over the last few years about autonomy being a hugely tricky technical problem to solve. One that is perhaps more difficult than a lot of people thought it would be at the outset. I’m assuming that this is at least one of the reasons why ridesharing companies like Uber and Lyft ended up selling off their AV divisions while searching for profitability.

    But the market never gave up and it’s pretty exciting to see this coming to fruition. Oliver Cameron is VP, Product at Cruise and the former CEO of Voyage (which was acquired by Cruise last year). If his tweets (above) are any indication, San Francisco is going to be seeing many more autonomous vehicles in the coming months.

    This is going to have a profound impact on the unit economics for ride sharing companies like Uber, but more importantly it is likely to have a profound impact on our cities. Mobility innovations have a way of doing that. Some of the impacts might be negative, but I believe that many of the impacts can and will be positive.

    As most of you will know, I am a believer in dense and walkable cities. I do not believe in planning cities around cars. And so that is not what I am advocating for here. My view is simply that I think autonomy grants us the ability to rethink our definition of a “vehicle.” And maybe it becomes something that more closely resembles public transit. That could be a positive thing for our cities and something that draws people away from private vehicle ownership.

    So I remain both optimistic and excited about what’s to come.

    Have any of you had a chance to ride in an autonomous vehicle? If so, leave a comment below or on Twitter.

  • Where US students want to live after college

    Axios and Generation Lab have something new called the Next Cities Index. The goal is to track US work and culture trends through people’s geographic preferences. For their first cities index, they asked over 2,100 students in the US, on two separate occasions, the following question: “Considering all factors that matter to you, where would you most like to live after college?”

    The aggregate answer to this question is shown above. But they also collected people’s incomes (anticipated since they’re students?), political affiliations, and gender. The list of cities changes slightly when you sort based on these different factors, but not by much. Seattle, New York, and Los Angeles remain top cities — at least in people’s minds.

    It is, however, interesting to note that about 45% of respondents had different answers to where they want to live and where they think they will live. For a number of reasons, the city of people’s dreams isn’t often a practical or realistic choice it would seem. Still, wanting a particular place still tells you certain things I suppose.

    Given all the chatter over this pandemic, I would have thought that Miami would have appeared higher up on this want list.

    Chart: Axios/Generation Lab

  • 6-unit missing middle site for sale in Toronto

    Marty over at Laneway Housing Advisors published this listing in his newsletter today. It’s for an entitled lot at 78 Gladstone Avenue in Toronto that has been approved (by way of a minor variance) for 6 units. Five units in the front where a house currently sits and one unit at the back in a standalone laneway suite. Though it also happens to be a corner lot and so the laneway suite isn’t really “in the back”.

    It’s listed for $2.5M. And according to the description, you can build about 5,500 square feet (4,200 sf in the front with a 1,300 sf laneway suite). This ask translates into a land cost that is just over $450 per buildable square foot, which is far more than what high-density land typically trades for in the city right now. This is usually the case for smaller low-rise sites.

    To help put this figure into some kind of context, Bullpen Consulting published in their latest insights report that the average high-density land price in Q4-2021 was $135 per buildable square foot in Toronto (416 area code only). Of course, averages only tell you so much. To truly evaluate the feasibility of a site like this, you’d need to create your own pro forma and do your own residual land value calculation. The value of development land depends on what you can build on it.

    If you were to do that, I suspect that you would discover at least two things: 1) you would find it challenging to make the numbers work, particularly for rental housing, and 2) you would quickly realize that this sort of “missing middle” housing isn’t, in its current form, some undiscovered bastion of housing affordability.

    Part of the problem is that these 6 units are not being delivered on an as-of-right basis. Somebody had to go out and entitle the land in order to secure these permissions. That means that time and money were spent and that the current owner is now rightly seeking a margin for their efforts. But if we collectively believe that this is an appropriate and sensible form of housing, then this should not be a necessary step in the whole process. Especially for only 6 units.

    All of this being said, we know that Toronto and many other cities around the world are taking a hard look at this issue. And that there is a groundswell of interest in allowing more housing in our low-rise communities. It’s going to be a battle — just look at how Toronto’s new garden suite policies have now been appealed by various resident’s groups. But I’m certain that we’ll get there, just like we are getting there with laneway housing and other types of ADUs.

  • Who cares if there’s an NFT bubble?

    The Financial Times recently reported on “the great NFT sell-off” here in this article. Daily trading volumes on OpenSea, which is the largest NFT marketplace, are down 80% ($50M) from their high in February ($248M). Bored Ape Yacht Club, which is the most expensive NFT collection out there, has seen its average daily price come down by about a third (see above). Of course, they still remain extremely valuable NFTs. And a recent CryptoPunks auction was just pulled from Sotheby’s so that the owner could “HODL” until things recover.

    I don’t think any of this should surprise both NFT holders and the naysayers. This is a high-risk space and it is all very speculative. You can’t run a discounted cash flow (DCF) model on a Bored Ape and most other NFTs (though some might actually produce cash flow through, for example, secondary sale royalties). The more important point of all of this is that we are living through what many people believe is the creation of a new kind of internet. Cryptocurrencies are what underpin these new digital economies, but we are still figuring out how they will function and what their long-term business models will be.

    For me, this is an exciting thing to be a part of. I’m not a venture capitalist, but buying NFTs and doing other crypto things feels a bit like I am an amateur one. Holding ETH or SOL is similar to holding Canadian or US dollars (currencies that underpin economies). So what I am doing is using these currencies to put money into ventures (NFTs) that seem interesting. And to do that, you look at the art, the team behind the project, the roadmap, and how well they appear to be executing against that plan. Indeed, many of the most successful NFT projects are naturally run by teams who are constantly building and shipping.

    At the same time, I mentally write off every NFT I buy to $0 as soon as I purchase it. I am also limiting my total crypto allocation to between 5-10% of my non-real estate investments and buying with a scheduled dollar-cost averaging approach. So if this whole web3 thing went to zero tomorrow (which I firmly do not believe will be the case), my life would still go on. None of this is, of course, investment advice. Please do your own research and make your own decisions. But I can tell you that it is a lot of fun following and learning about what smart, creative, and entrepreneurial people are doing in this emerging space.

    If you’re interested in NFT photography, check out my global citizen collection on Foundation.

    Chart: Financial Times

  • Cars make cities less compact

    The relationship between car ownership and urban density is a fairly intuitive one. Below are two charts from a study by Francis Ostermeijer, Hans Koster, Jos van Ommeren, and Victor Nielsen, showing how urban density is inversely correlated with car ownership. In other words, the more people with cars, the less dense that a particular place is likely to be.

    But there’s an interesting chicken-and-egg question here. Does Atlanta, which is near the bottom right in the above chart, have a lot of cars because it wasn’t dense enough to support other modes of transport, or did the prevalence of cars in Atlanta cause the city to spread out and become less dense? And that is exactly what the above researchers set out to determine.

    To do this, they started by looking at the presence of commercial car manufacturers in the above geographies in the 1920s. One of the things they found was that having a car manufacturer in your city at this time appears to have had no effect on population density. But over the long run, rising car ownership seems to have had a sizeable effect on reducing population densities in those places.

    The conclusion they draw from this is the title of this post: cars have made cities less compact, rather than low population densities causing people to go out and buy more cars. This makes some sense to me because cities were doing just fine before we invented cars. But like all transportation innovations that allow us to move faster over longer distances, the car encouraged decentralization.

    There are, of course, all sorts of possible implications for a finding like this. But the authors specifically mention developing countries where car ownership may still be relatively low. This is something to be mindful of because if you put most people into cars, history strongly suggests that it will impact the kind of city that you end up building.

    Chart: Cars make cities less compact

  • Construction update: Junction House

    This is a photo of Junction House that I took this morning after our weekly construction meeting. The team is currently preparing for the first concrete pour of level 4 (each floor has been split up into three pours). We’re now flying our forms, which means that we’re able to move a lot faster. This is the exciting part of a new build mid-rise like Junction House. The underground garage part is like watching paint dry.

    We’re scheduled to be topped out by this summer, so expect some gratuitous view photos on the socials.

  • Playful parkades

    This is perhaps the wrong post to be writing right now with gas prices where they are, but lately I’ve been thinking about parking garage designs. We have talked a lot about parking minimums and other related topics on this blog, but let’s put all of these aside for today and assume that parking garages are a thing that will continue to exist in our cities.

    Generally speaking, parking garages are fairly utilitarian spaces. They store cars and they usually aren’t that nice. And in the case of public garages, they often smell like urine. But there are some extraordinary examples out there. Miami immediately comes to mind as a city with some pretty cool garages. I mean, when you have one designed by Herzog & de Meuron (1111 Lincoln Road) that is usually a pretty good indicator.

    When I was there in January, we went walking one night through the Design District and we ended up on the roof of “Museum Garage” to take some photos and take in the views. Once we got there, we found people doing everything from eating dinner to filming TikTok videos. Great spaces attract people. It also helps when all of your parking is above-grade, which is the case in Miami.

    Here is another example from Sydney (also pictured above). In this case, it’s a residential parking garage and Craig & Karl were hired to create a colorful geometric mural. Garages are a perfect place to be a bit more playful and have some fun. I think we should do more of this.

    Photo via Craig & Karl