I recently came across this for-sale listing from Fantastic Frank for a 3-room apartment in Berlin's new Am Tacheles district. Naturally, I thought to myself, "Hey, this is a beautiful apartment — now let me go all the way back to the beginning of the 20th century and better understand the history of the development site."
Am Tacheles has been called the most controversial real estate project in Berlin's modern history. Previously developed in 1908 as a high-end shopping arcade intended to rival the great galleries of Paris, the Friedrichstraßenpassage, as it was known, was an ambitious undertaking located in the city's historic Jewish quarter.
But only about six months after opening, the project went bankrupt. The existing building then went on to live numerous lives, ranging from an AEG showroom to a building used to house French war prisoners, before ultimately being co-opted by artists in 1990 as a way to save it from demolition.
It was at this point that it was given the name Tacheles, which is a Yiddish word meaning "to speak straight." Supposedly, this was a reference to the area's history as a thriving Jewish quarter and a message about political honesty (it is located in the former East Berlin, where that wasn't a thing).
For the next two decades, the site became a global symbol of Berlin's "poor but sexy" identity. The ownership vacuum created by the fall of the Berlin Wall meant that nobody really knew who owned what. This was a disaster for clear property rights and capital investment, but fortuitous for squatters who needed cheap (okay, free) space to experiment with art and techno music.
In my view, this was ultimately a net positive for the city. It created an urban vitality that nobody could have predicted, demonstrating the potential of people and cities when allowed to experiment and take risks.
But then, basically, two things happened: (1) people eventually figured out who owned what, and (2) the development potential of the site became increasingly valuable. This is the quintessential urban cycle. First, the artists and creatives come in to take advantage of cheap space. They then make the area cool. And then developers like me come in to monetize it, completing the cycle.
Fast forward to today, and Am Tacheles (they kept the name) is a new master-planned community designed by Swiss architects Herzog & de Meuron and one of the most desirable (and thus expensive) areas in Berlin. It's also quite a bit tidier there these days, though they did preserve some of the graffiti.
Returning to our 3-room apartment listing, the asking price is €1,825,000 + €90,000 (for what I believe is a parking space). At 113 sqm, this works out to ~€16,947 per sqm or about C$2,529 per sqft (for comparison to Toronto prices). As I understand it, this is well above the average new construction home prices in the area and city.
What is clear is that Berlin is no longer poor. It's global-city rich. But is it still sexy?
Cover photo and floor from Fantastic Frank
Historic Tacheles photo via Wikipedia
Am Tacheless photo and stairwell section from H&dM
It is well known that the majority of Singaporeans live in public housing (that is, housing provided by the Housing and Development Board, or HDB). However, what you may not know is that the majority of residents obtain their housing through a model that shares some high-level similarities with the way we deliver new condominiums in Toronto.
In 2001, the HDB introduced a program known as Build-to-Order (BTO). The way it works is fairly straightforward: the HDB announces a new project, prospective buyers apply and are assigned a queue number, and then, if they're selected, they get to buy. Once a sufficient number of "pre-sales" have been obtained, the project begins construction, and buyers get a brand-new, subsidized apartment in 3 to 5 years.
Singapore also mandates that the apartments must be owner-occupied and so, in this carefully controlled delivery model, supply very closely mirrors demand. This is different from traditional condominium pre-sales where some buyers might be end users, some might be planning to rent out the home, and some might want to sell immediately upon completion. In those markets, the risk of overbuilding and speculative volatility is greater.
HDB classifies the apartments themselves into three groups: Standard, Plus, and Prime. This classification is meant to reflect the locational value of certain projects; but importantly, the intent is that they're all equally attainable to citizens. The difference is that "choicer" locations (their vocabulary — now you have a new Scrabble word) require greater subsidies to make them affordable, and so they come with additional obligations.
For example, in the case of Prime flats, there is a subsidy recovery upon any future sale (I'm told it's between 6-9% of the first resale price), the minimum occupation period (MOP) is 10 years (versus 5 for the Standard class), and you can never ever rent out the whole home, even once the MOP has lapsed. Once again, this is about strictly matching new supply to end-user demand.
It's a lot of rules. But in Singapore, the majority of people accept them in exchange for affordability.
Cover photo: Tengah, Singapore via Monocle
My predictions for 2026
From the Toronto condo turning point to the bursting of the AI bubble
The best part about making predictions for a year ahead is that at the end of the year you get to look back with humility on what you were thinking at the time and realize how much you missed and how different things turned out.
So, what might happen in 2026?
Condominium development in Toronto: I think 2026 will be an important turning point year. If I keep saying this, at some point I'll be right, right? 2026 is the first year where we will start to see new condominium completions from the last cycle fall off significantly. Last year (2025), we were projecting nearly 32,000 condominium home completions. This year, it's projected to drop to ~17,487, with 2027 falling off even further as we head to almost no new supply (based on the current pipeline). What I think this means is that the first half of 2026 will still be painful as the market absorbs new inventory and the inventory from 2025 (including unsold units, units in default, and other scenarios), but that things will start to stabilize and feel better toward the end of 2026 and into 2027. New supply will now be delivering below the 10-year average for the first time in many years.
Purpose-built rental development in Toronto: The story since the condominium market turned in 2022 has been the flip to rental. But not all developers and sites can make this switch and, as I have argued before, the numbers suggest that it won't be enough to offset our dwindling new condominium supply. That said, I think rental rates will remain soft throughout 2026. The supply crunch we're headed toward will need a bit more time to be felt by the market. In the meantime, we will see the highly-amenitized purpose-built rental model fail. The strategy of using over-the-top amenities to drive high rents will finally fall apart in the current market environment. In its place will be a flight to value: boring rental models that offer a quality housing experience at reasonable prices.
Boutique end-user projects: In markets like Toronto and Vancouver, where the development landscape remains unfavourable, we will see a continued focus on smaller projects and projects catering exclusively to end-users. This demand segment is the most resilient and this re-orientation will help the next development cycle start on more solid footing.
Foreign buyer ban: The Canadian federal government will relax the foreign buyer ban (which is set to expire on January 1, 2027) and allow foreigners to buy pre-construction homes. There are already rumblings about this so I acknowledge this isn't that bold a prediction. But beyond just relaxing the ban, I think government will start actively courting foreign capital to help solve our housing needs.
AI bubble: 2026 will be the year that the AI bubble bursts. Not because AI isn't powerful tech that will continue to change the world, but because we are, in the words of investor Howard Marks, in an "inflection bubble." This is different from a fake bubble like Tulip Mania where there was ultimately no underlying reason for tulips to be valued so highly. An inflection bubble is where we get the direction right (AI is a big deal), but the magnitude wrong (shit, we overspent on CapEx). Not every AI company can and will survive. There will only be a select few once the dust settles. And since AI seems to be what's driving the market these days, I think the market will close the end of this year down (measured as the performance of the S&P 500).
Continued AI adoption: That said, AI will continue to change the way we all live and work. While this is going to put some people out of a job, my bias is an optimistic one in that new technologies tend to create new opportunities and generally grow the overall economy. However, I think that at least two enormous internet-type shifts are underway. One, AI is creating a massive productivity leverage for the people and firms that know how to harness it and, two, the backend of the global financial market is moving "onchain." These are profound shifts that I, unfortunately, think will lead to even more social and political division in the short term. A government somewhere in the world will respond with a universal basic income.
AI bubble impact on real estate: An AI bubble bursting will generally help the real estate market as investors look for returns somewhere else, with the exception of the data center market. It will also create downward pressure on interest rates (which, in the US, remain the highest they have been since the Great Recession in 2008). As we know, lower rates help boost the values of highly-levered assets like real estate.
AR/VR/AI for design and construction coordination: I was blown away the first time I tried Apple Vision Pro. It's a magical experience. But it has failed as a consumer product and who knows what Apple will launch next. Regardless, this year we will see clear use cases emerge for AR, VR, and smart glasses. I'd like to see the problems of design and construction coordination get immediately solved because they're massive and costly and they have yet to be solved.
Mainstream tokenization: In yesterday's post, I spoke about the lack of a breakout consumer-facing web3 app in 2025 (with honourable mention going to the Base app). But perhaps one of the big stories of last year was stablecoins entering the mainstream. Most people now agree they have achieved product-market fit. This is crypto solving real problems (cheap/fast cross-border remittances, payments, etc) with users not needing to think or care about the underlying blockchain technology. In 2026, we will see a noteworthy office building or apartment building get tokenized on the Ethereum blockchain.
Autonomous vehicles: Last year, I predicted that autonomous vehicles were going to have a year, and it certainly felt that way. This year will be the first year that I ride in one. I came close on a layover in San Francisco in December. I considered leaving the airport and taking one to Apple Park. But I would have been cutting it too close. In 2026, we will see an insurer refuse to cover a human driver for the first time, marking a clear global shift toward autonomy. Already, none of us should be driving cars anymore looking at current safety data.
Polycentric world: Some have argued that 2025 marked the end of globalization. I'm not sure that is accurate. I think it marked the end of the US-led post-war world order and the acceleration of a more polycentric world order. It was the start of greater US insularity. In 2026, Canada will start to see the benefits of this shift. What it is doing is shaking us out of complacency and forcing us to look east to Europe and west to Asia, as opposed to just south to the US.
What are your predictions for the year ahead?