I was listening to The Urbanist (Monocle Radio) last night while I was making dinner and there was a segment on Moscow’s “illegal retail kiosks.” These are small scale retail structures that were built without formal planning permissions and so the city decided to demolish them. 

There was lots of backlash. Photos here.

Now, I’ve never been to Moscow. So I can’t really comment on the attractiveness and usefulness of these kiosks. But I suspect that these illegal retail kiosks, many of which seem to have been located around metro stations, contributed quite a bit to the city’s urban vibrancy. Retail is hard to get right. It doesn’t work everywhere.

All of this got me thinking about our tendency to sterilize and overplan cities. I’m not saying that planning is bad. It’s not. But I do think we should acknowledge that we don’t know everything about the future and that human ingenuity will undoubtedly unlock new things we never thought would be beneficial.

So how do we plan for the unplanned? Perhaps it starts with accepting the off-center. Here’s a quote from Anthony Bourdain (it’s all over the internet, but I can’t seem to find the original blog source):

I think that troubled cities often tragically misinterpret what’s coolest about themselves. They scramble for cure-alls, something that will ‘attract business,’ always one convention center, one pedestrian mall or restaurant district away from revival. They miss their biggest, best, and probably most marketable asset: their unique and slightly off-center character. Few people go to New Orleans because it’s a ‘normal’ city — or a ‘perfect’ or ‘safe’ one. They go because it’s crazy, borderline dysfunctional, permissive, shabby, alcoholic, and bat shit crazy — and because it looks like nowhere else. Cleveland is one of my favorite cities. I don’t arrive there with a smile on my face every time because of the Cleveland Philharmonic.

There’s value at the margins.

It was just announced that the full floor 8,255 square foot penthouse in the Rafael Viñoly-designed 432 Park Avenue (New York) has closed at a sale price of USD$87.7 million. That works out to be just over $10,600 per square foot.

It was purchased by Fawaz Al Hokair and is currently the most expensive sale in the building. However, the most expensive sale, ever, in New York remains the penthouse of One57, according to Curbed. It was purchased for $100.5 million.

Architecturally though, I much prefer 432 Park Avenue. I love its simplicity.

Each floor plate is 812 square meters. But because of the building’s height (424 meters / 1,395 feet) it appears a lot smaller. The ratio of building width to building height is about 1:15.

Because of this “slenderness ratio” the building is split up into 7 distinct volumes with a void between each. These voids – which are completely empty save for the building’s core – reduce wind loading and help with the building’s overall structural stability. (I’m sure it’s fine.)

The structural system is the exposed concrete grid. This leaves the interior of the floors completely column-free. Every window within this grid is exactly 10 square meters. 

Here’s a good interior example of that:

On a none architectural note, the building also features a private restaurant. I am curious how a private restaurant can operate sustainably in a building with 100 and some apartments owned by many people who probably don’t spend all (or much?) of their time in New York. Perhaps it’s partially carried by the ~$2.10 per square foot monthly maintenance fee.

Occupancy is available immediately if you happen to be in the market.

Images: 432 Park Avenue

Earlier this week the Wall Street Journal published an article claiming that the celebrated venture capital firm Andreessen Horowitz was lagging behind its elite peers in terms of returns.

The firm then responded with a well-written blog post explaining why this accusation is off the mark. Their response was simply that you can’t measure returns on “unrealized gains.” Until there is a liquidity event – that is, the company gets sold or goes public – it’s just paper returns. And what matters is cash. 

As the post clearly states: “I can’t spend unrealized gains.”

But beyond just a rebuttal, the blog post is a great primer on how the venture capital industry works. We talk a lot about the tech space on this blog, so I thought some of you might find it interesting. 

One of the reasons I like to follow the VC space is that there are many similarities to real estate development. Not only in the way that the funds are structured, but also in the way that the gestation periods are incredibly long.

The post talks about this as a “J curve.” In the early years of a fund, the returns are negative. Money is going out the door to invest in immature and risky startups. And it’s not until the harvesting period (7+ years later) that the realized gains start getting paid out to investors (LPs).

It’s also interesting to note that the exit timing for companies – at least according to Andreessen Horowitz – seems to be increasing (10+ years). This is yet another similarity to real estate development where it seems to be getting harder and harder to build and deliver new supply.