But in the contemporary world of real-estate – corporatized, institutionalized and massively capitalized – is there any longer room for the swashbuckling “merchant developers” or are they doomed to go the way of the wildly-gesticulating floor traders in colourful blazers that once symbolized financial markets?
“There is always room for the entrepreneur,” says Richard Bloxam, JLL’s head of capital markets, Europe, the Middle East and Africa. “It is, however, fair to say that real estate has been on a journey away from total reliance on the entrepreneurial model.”
I’ve written about the institutionalization of the business before. And it’s something I’ve been asking developers that I interview for my BARED blog series. Are the days of the eccentric and larger than life developer behind us?
The consensus appears to be no.
All that has changed is the capital source / stack. The skills that make for a successful developer haven’t changed. You still need to be creative and look for opportunities that others don’t see. You still have to navigate through all of the various constraints – of which there is probably more of today. You still need to be entrepreneurial in spirit.
But in the contemporary world of real-estate – corporatized, institutionalized and massively capitalized – is there any longer room for the swashbuckling “merchant developers” or are they doomed to go the way of the wildly-gesticulating floor traders in colourful blazers that once symbolized financial markets?
“There is always room for the entrepreneur,” says Richard Bloxam, JLL’s head of capital markets, Europe, the Middle East and Africa. “It is, however, fair to say that real estate has been on a journey away from total reliance on the entrepreneurial model.”
I’ve written about the institutionalization of the business before. And it’s something I’ve been asking developers that I interview for my BARED blog series. Are the days of the eccentric and larger than life developer behind us?
The consensus appears to be no.
All that has changed is the capital source / stack. The skills that make for a successful developer haven’t changed. You still need to be creative and look for opportunities that others don’t see. You still have to navigate through all of the various constraints – of which there is probably more of today. You still need to be entrepreneurial in spirit.
What I wonder though is if this change hasn’t undemocratized the business to a certain extent. It seems to me that it’s harder, today, to fly by the seat of your pants with just an idea (and no capital). The barriers to entry feel more significant. But as Richard says, “there is always room for the entrepreneur.” And I believe that.
I would be curious to hear your thoughts.
Also, the next BARED post will be up shortly. Stay tuned.
Here is an interesting discussion paper on the Toronto region’s economy, demographic outlook, and its land use. It was recently published by IBI Group and Hemson Consulting to support the 10-year review of our regional transportation plan.
I wanted to share a couple of charts from the report that I thought were interesting. If you’re not in the Toronto region, I would be very curious to hear how your city might compare in terms of the way it is trending.
The first chart is net migration by age group. Like Vancouver – similar chart posted here – people have been moving into the city/Toronto when they’re young and then moving out to the suburbs once they start having families.
Will that continue? The oldest Millennials are now hitting their mid-30′s and I am very interested to see if there will be any reversal in this.
I was walking by a tight construction site last night and it got me thinking. Besides the obvious environmental benefits of building up, as opposed to out, compact urban sites can force something else: intent.
One of the ways I think about good design is that it is intentional. It is about seeing problems and/or opportunities and then being deliberate in how you respond. Every creative decision needs a reason why. I like how John R. Moran talks about design in this blog post from 2014:
“The opposite of design, then, is the failure to develop and employ intent in making creative decisions. This doesn’t sound hard, but, astonishingly, no other leading tech company makes intentional design choices like Apple. Instead, they all commit at least one of what I term the Three Design Evasions.”
The three design evasions he goes on to talk about are (1) preserving, (2) copying, and (3) delegating.
The thing about compact and constrained urban sites is that they can force you away from the three design evasions that Moran lists in his post. You can’t just repeat what was done in the past or copy what someone else has done, because that precedent probably didn’t have the same challenges you face.
Of course, if this were enough to promote great design, our cities would look a hell of a lot different. Still, it’s one of the reasons why I’m attracted to compact forms of development such as laneway housing and other urban infill.
What I wonder though is if this change hasn’t undemocratized the business to a certain extent. It seems to me that it’s harder, today, to fly by the seat of your pants with just an idea (and no capital). The barriers to entry feel more significant. But as Richard says, “there is always room for the entrepreneur.” And I believe that.
I would be curious to hear your thoughts.
Also, the next BARED post will be up shortly. Stay tuned.
Here is an interesting discussion paper on the Toronto region’s economy, demographic outlook, and its land use. It was recently published by IBI Group and Hemson Consulting to support the 10-year review of our regional transportation plan.
I wanted to share a couple of charts from the report that I thought were interesting. If you’re not in the Toronto region, I would be very curious to hear how your city might compare in terms of the way it is trending.
The first chart is net migration by age group. Like Vancouver – similar chart posted here – people have been moving into the city/Toronto when they’re young and then moving out to the suburbs once they start having families.
Will that continue? The oldest Millennials are now hitting their mid-30′s and I am very interested to see if there will be any reversal in this.
I was walking by a tight construction site last night and it got me thinking. Besides the obvious environmental benefits of building up, as opposed to out, compact urban sites can force something else: intent.
One of the ways I think about good design is that it is intentional. It is about seeing problems and/or opportunities and then being deliberate in how you respond. Every creative decision needs a reason why. I like how John R. Moran talks about design in this blog post from 2014:
“The opposite of design, then, is the failure to develop and employ intent in making creative decisions. This doesn’t sound hard, but, astonishingly, no other leading tech company makes intentional design choices like Apple. Instead, they all commit at least one of what I term the Three Design Evasions.”
The three design evasions he goes on to talk about are (1) preserving, (2) copying, and (3) delegating.
The thing about compact and constrained urban sites is that they can force you away from the three design evasions that Moran lists in his post. You can’t just repeat what was done in the past or copy what someone else has done, because that precedent probably didn’t have the same challenges you face.
Of course, if this were enough to promote great design, our cities would look a hell of a lot different. Still, it’s one of the reasons why I’m attracted to compact forms of development such as laneway housing and other urban infill.
Given the above trend, people in this region are not surprisingly also swapping apartments for ground-related housing as they get older. The crossover point seems to be (or at least has been) when people hit their mid-30′s. Again, I am curious how this may evolve as the city matures.
Because if you look at housing completions from 2001 to 2016 (chart below), the only municipality that was able to meaningfully increase its housing supply was Toronto.
Every other municipality – except for Hamilton, which posted modest gains – experienced significant declines in the number of new homes delivered to the market over the last census periods.
Of course, the only reason Toronto was able to increase its housing supply was by building up – in other words by building condos and apartments. (Shown in the purple below. For some reason the legend is incomplete in the report.)
If you look at the share of housing completions, over 80% of new homes in Toronto are now in apartment form.
Intensification is a deliberate policy choice. And we can certainly debate whether it’s a good or bad thing (I believe it’s a good thing).
But putting that aside, the above charts are a great answer to the perennial question: “How is it that Toronto is building so many condos?” This is why.
Given the above trend, people in this region are not surprisingly also swapping apartments for ground-related housing as they get older. The crossover point seems to be (or at least has been) when people hit their mid-30′s. Again, I am curious how this may evolve as the city matures.
Because if you look at housing completions from 2001 to 2016 (chart below), the only municipality that was able to meaningfully increase its housing supply was Toronto.
Every other municipality – except for Hamilton, which posted modest gains – experienced significant declines in the number of new homes delivered to the market over the last census periods.
Of course, the only reason Toronto was able to increase its housing supply was by building up – in other words by building condos and apartments. (Shown in the purple below. For some reason the legend is incomplete in the report.)
If you look at the share of housing completions, over 80% of new homes in Toronto are now in apartment form.
Intensification is a deliberate policy choice. And we can certainly debate whether it’s a good or bad thing (I believe it’s a good thing).
But putting that aside, the above charts are a great answer to the perennial question: “How is it that Toronto is building so many condos?” This is why.
