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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Category: Toronto

  • Why 2029 will be the bottom for Toronto housing supply

    November 23, 2025 · View original

    > Tweet: Contrary to some reports, we’re not actually building much rental housing in Toronto these days. https://t.co/t20UiwpQzV

    Rental apartment completions in the Greater Toronto & Hamilton Area (GTHA) are expected to exceed condo completions for the first time in a very long time starting in 2028. But what does this mean for the overall market, and is it actually going to be enough new housing? Let’s look at some of the numbers.

    Last year, the GTHA recorded 29,671 new condo completions. This was some sort of a record. This year, condo completions are projected to total around 31,396 homes. Even higher. But then completions start to fall off, with 17,487 homes scheduled for completion in 2026. By 2029, this number is expected to be close to 1,000. So let’s call it zero for argument’s sake.

    If we are to crudely assume that 50% of these new condominiums ultimately make it to the secondary condo rental market, then we are expecting nearly 16,000 condo rentals this year, just under 9,000 condo rentals in 2026, and ultimately no new condo rentals by around 2029 (or some number close to it).

    Now let’s consider the purpose-built rental side of the equation.

    The 10-year average for purpose-built rental apartment starts in the GTHA is only 2,819 homes. This is a far cry from the volume of rental housing that we delivered in the 60s and 70s. Of course, with the new condominium market largely shut off, there’s renewed interest in building purpose-built rentals.

    In 2024, purpose-built rental apartment completions totalled 5,537 homes. And in the first half of this year, 3,156 homes reached the occupancy stage. Extrapolating out, I’m guessing that puts us somewhere around 6,000 new purpose-built rental apartment homes by the end of 2025.

    If we pause and think about only 2025, we’re on track to deliver roughly 37,000 new condo/rental apartments and ~22,000 new rental homes (again assuming 50% of the new condominiums become secondary rentals). I view this as our peak supply year for this cycle.

    There’s a lot of talk about a “record” number of purpose-built rental apartments now under construction, and while it is true that the numbers are elevated compared to the latest 10-year average, it is not a long-term record compared to the 60s and 70s and, more importantly, it is not enough to offset our dwindling new condominium supply.

    Even if purpose-built rental completions spiked to 8,000 or even 10,000 new homes next year, we are still going to see a drop in new rentals and new housing overall in the GTHA. 2026 is the turning point year where new supply turns south. And it’s going to keep going south until probably 2029, which is when I believe we will see supply bottom out.

    Nothing in this post should be construed as investment or development advice, but here’s the way I’m thinking about it:

    – 2025: ~37,000 new condominium/apartment homes (peak supply year resulting from the pandemic boom) – 2026: ~25,000 new homes (supply begins its decline) – 2027: ~18,000 new homes – 2028: ~10,000 to 13,000 new homes – 2029: ~8,000 to 10,000 new homes (supply bottom)

    I have no idea what will happen with interest rates, immigration, investor sentiment, and the countless other factors that impact a housing market, but even if things started to turn around next year, it would be mostly impossible to avoid the housing supply bottom that I believe we have coming in 2029. Buildings take a long time to build.

    Conclusion: I think that 2026 will prove to be an excellent year to buy assets (land, unsold inventory, IPP, and so on), and that 2028 onward will be an excellent time to be delivering new homes. By then, we should be dramatically undersupplying the market. It doesn’t feel that way today, but eventually the bill from our frozen development market will come due.

    Cover photo by Adam Vradenburg on Unsplash

  • Toronto re-embraces small-scale retail

    November 15, 2025 · View original

    Good news: If you would like to open a small-scale retail business in Toronto — and you have a property that is residentially zoned on a major street (in one of the approved areas), or you have a corner property on a designated “community street,” or you have a property that abuts a non-residential use such as a park or public school — you may now be allowed to do it, with some restrictions. (Consult your local planner for exact details.)

    This, as we talked about recently, is meaningful progress for Toronto. But as is always the case, it was not easy. Toward the end, local community groups even started using AI slop in an attempt to terrify the public into thinking that this would be a harbinger of littering hoodlums loitering in all of our neighborhoods.

    Thankfully, this city has people like Dan Seljak, Blair Scorgie, and many others — including, of course, the EHON team at the City — who have been instrumental in getting something passed, even if it had to change a little along the way. City building ain’t easy. They should all be proud of what they’ve accomplished. I look forward to seeing what kind of local entrepreneurship this unlocks. Go Toronto.

    Cover photo by Joe Yu on Unsplash

  • Toronto isn’t as car-oriented as you might think

    November 13, 2025 · View original

    One of the things that I’ll often hear people say about Toronto is that we’re a car-oriented city with inadequate transit, and that’s why we simply can’t implement things like congestion pricing. Usually it’s accompanied by statements like this: “Sure, I can see how it might work in London or New York, but they have proper transit systems, and we don’t.”

    But is this really fair to say?

    Let’s look at some of the data from the 2022 Transportation Tomorrow Survey.

    For all trips starting and ending in the City of Toronto, people driving themselves around is the dominant mode share at 45.3%. But the transit mode share is not nothing at nearly a quarter of all trips. And if you add up taking transit, walking, cycling (and other forms of micromobility), and taxiing, you get to 42% of all trips within the city. That’s a meaningful number.

    For home-based work trips within the City of Toronto, the split between driving and taking transit becomes dangerously close. (A home-based work trip is a trip within the city that either starts or ends at home and is done for the purpose of work.) Driving sits at 39.4% and transit sits at 37.1%. Add in walking (10.2%), cycling/micromobility (5.8%), and taxiing/ridesharing (1.4%), and non-car forms of mobility dominate when it comes to getting to and from work.

    Looking at all trips to only downtown Toronto, transit once again dominates at 40.4%. Add in the other non-car forms of mobility and we’re up to nearly 75% of all trips.

    The numbers become even more pronounced if we look at only home-based work trips to downtown. In this case, transit ridership increases to 48.7%. Add in the other non-car forms of mobility and we’re now at 80%!

    These are fascinating figures because, let’s say you were considering a congestion charge for motorists driving into downtown Toronto, and that the proceeds of this charge would be used to make impactful investments in transit and other mobility infrastructure. Based on this data, you’d actually be benefiting the greatest number of Torontonians.

    These numbers also help to debunk the objection that people simply have no other option. If you’re coming into downtown Toronto, you have options. The transit exists, and the majority of Torontonians use it.

    I guess Toronto isn’t so car-oriented after all. (The rest of the region is a different story.)

    Charts via the City of Toronto (TTS 2022); cover photo by Aditya Chinchure on Unsplash

  • The architectural icons born from Toronto’s last real estate cycle

    November 9, 2025 · View original

    CoStar recently published an article titled “Architectural stars appear on the skyline of Canada’s largest city — Toronto reaches a new level of global reach and ambition.”

    What the article is talking about is a slew of iconic, under-construction projects designed by some of the world’s most celebrated living architects. Namely, Forma by Frank Gehry (Los Angeles), One Delisle by Jeanne Gang (Chicago), KING Toronto by Bjarke Ingels (Copenhagen), as well as a handful of other noteworthy projects by some of the best local firms in Toronto.

    It is no doubt an exciting moment. These are projects that, I think, the world will come to associate with our great city. They will strengthen the global brand of Toronto.

    But let me also state the obvious: These projects are the result of a particular moment in time and a particular point in the last real estate cycle. They wouldn’t exist today, irrespective of our level of ambition.

    This is not to say that this calibre of project won’t exist again in the future — it will. But for right now, these are special and differentiated architectural treasures that truly stand alone, showing us what is possible when we bet on the unknowable future.

  • Exactly how impossible is a dense, urban Toronto?

    October 27, 2025 · View original

    Back in the summer, I wrote about the publication Impossible Toronto that my friends Gabriel Fain, Francesco Valente-Gorjup, and Aleris Rodgers authored for the Neptis Foundation. (If you’d like to purchase a copy of the book, you can now do that online here.) And this past weekend, Alex Bozikovic of The Globe and Mail wrote about it in an article called, “A dense, urban Canada? It’s possible.“

    Here’s an excerpt:

    > The formula is simple: Replace century-old houses in the middle of the city with courtyard blocks – apartment buildings of four to six storeys, lined up side by side along the street and leaving a doughnut-hole of green. Their apartments have windows facing both the street and a green space at the centre of the block. Such buildings make up the fabric of many Western European cities.

    > Yet they are impossible to build in Canada for a variety of regulatory reasons. Most important: Our building codes require every apartment to have two separate exit stairs. If you eliminate that rule and follow the lead of Switzerland and Germany (two officious, safety-conscious states), everything changes. Buildings become much less bulky. Apartments gain light and fresh air in every room. Homes become more square, with better layouts and better rooms. This means a dramatic improvement in residents’ quality of life.

    Alex is exactly right that required exiting is a major hindrance to the housing type proposed in Impossible Toronto. We talk a lot about this on the blog, and as an industry. But big picture, it is only one item in a long list of things that will need to change if we actually want to emulate the housing types that are typical of most Western European cities.

    My contribution to Impossible Toronto was a handful of high-level development pro formas (pages 94-95). I was asked to model what is permissible today under the new “Expanding Housing Options in Neighbourhoods” (EHON) policies, and then model the Impossible Toronto typology. Finally, we decided to toggle this second pro forma to show what it would take to make it financially feasible, including removing things like development charges and site plan control.

    It’s important to point out that our current EHON permissions — which support as-of-right 6 storey apartments on all major streets — are already challenging to underwrite and have not yet been proven to work at scale. The starting problem is that developers need to be able to arrive at a residual land value that is greater than the as-is value of what’s there today — usually that’s a single-family home in the case of the EHON policies.

    This can happen in two ways. Developers need to be able to get enough density to justify a higher land value and/or the development cost structure needs to be low enough that enough value can be attributed to the land. This is where things like single-stair buildings come into play. They allow for more efficient designs, which help with project viability on a few different dimensions.

    Without a viable acquisition, housing projects do not start. So in my view, we need to attack this impossible problem from two sides. First, as-of-right densities need to translate into land values that are greater than the status quo. This is what will motivate landowners to sell. Second, the end result needs to be high-quality livable housing that as many people as possible can afford.

    If we can achieve these two outcomes, then we have a chance to not only make the impossible, possible, but we have a chance to scale it across Toronto and Canada.

    Cover photo by Aditya Chinchure on Unsplash

  • The economics behind Toronto’s condominium freeze

    October 23, 2025 · View original

    > [Tweet: Home prices in Toronto are not higher than Winnipeg because of development fees.

    Development fees have ZERO impact on what a typical buyer is willing to spend on a home.

    They only impact the price a builder needs to sell at to make a profit.](https://x.com/JohnPasalis/status/1981021084792053986)

    Urbanation just released its Q3-2025 condominium market survey results for the Greater Toronto and Hamilton Area. Last quarter, a total of 319 new condominium apartments were sold across the entire region. This is the lowest quarterly total since Q3-1990 and is 92% below the latest 10-year average for Q3 periods. It also places us on track for the worst sales year in about three and a half decades. But this isn’t news to anyone in the industry. And I’ll remind you all that, in my view, now is the time for contrarianism, not conformity.

    Here’s something I found interesting in the data, though, and it ties into the above quote tweet. The average prices for unsold condominiums in Q3 were as follows:

    – $1,315 psf for unsold pre-construction suites (i.e. projects in the pre-sale period) – $1,199 psf for unsold developer-owned suites (i.e. remaining inventory in built projects) – $867 psf for resales in recently completed buildings

    Why do you think there’s this gradient? The answer is that these are condominiums of different vintages and, therefore, of different cost structures. Developers generally price projects on a cost-plus basis — meaning if development charges go up (see above tweet), then developers have no choice but to raise home prices to cover their costs. And if the market isn’t there at these new higher prices, well then too bad for developers. We don’t get to build. The floor is the floor.

    In economic terms, what is happening right now is that the marginal cost of producing new condominium homes exceeds the marginal benefit to home buyers (i.e. costs are greater than what the market is willing to pay for new condominium homes). And for this to change, one or both of the following adjustments will need to occur. The cost of building will need to come down and/or the price buyers are willing to pay for new homes will need to go up. Until then, Urbanation will continue to publish gnarly market updates.

    But while the market works to find a new equilibrium, I do think it’s disingenuous to try and detach the cost of building new homes from end-user prices (which is what the above quote tweet seems to do). Increasing the marginal cost of a good forces prices to rise. In turn, the quantity demanded falls because fewer people can afford it. And if the demand curve also shifts to the left, which is what happened starting in 2022, then the quantity demanded can even approach zero (see second chart).

    Pretending we can heavily tax housing and not pay the price doesn’t help anyone looking for more affordable options.

  • Current status of single-stair buildings in Toronto

    October 19, 2025 · View original

    As many of you know, the Ontario Building Code requires multi-residential buildings over two storeys in height above grade to have more than one means of exiting the building. This typically means two exit stairs.

    If you’d like to build something more ambitious than this, you generally have two options. One, you could design your second-floor homes to be multi-storey. I’m not a building code expert, but I’ve seen architects like Craig Race (and others) do this without triggering the requirement for a second exit.

    Your second option is to apply for what’s called an “alternative solution.” This is basically a way of saying to the building department, “Hey, my design deviates from the standard prescriptive method, but it still achieves an equal or greater level of safety, performance, and functionality, so you should approve it anyway.”

    Last year, the City of Toronto sent a message that it was going to be more open to single-egress alternative solutions. It commissioned a report that looked at the feasibility of relaxing egress requirements for buildings up to four storeys and published a guide to help builders prepare these proposals. The goal was and is to encourage more missing middle housing.

    So has it worked?

    This past week, Pamela Blais shared her experiences on Twitter. She is trying to build a three-storey sixplex (Part 9 of the Ontario Building Code) with a single stair, so she submitted an ASP. It included:

    – Fully sprinklered building – Widened exit stair (1200mm vs. 900mm) – Expanded landings (1650mm) – Stairwell skylight for smoke exhaust – Improved fire ratings (structure, suite separation, exits, and balconies) – Balcony in every home for refuge or direct exit

    And the city’s response was: “Nope. This does not meet the required performance levels.”

    I can also share that we have had meetings with code consultants regarding the feasibility of doing a single stair in a six-storey building and the guidance we received was that there’s no way an ASP would be approved. We would be wasting our time and money. All of this should make it clear that we’re not there yet.

    Thank you, Pamela, for sharing your experience. As one commenter on Twitter said: “A noble quest you are on.”

  • Riz Dhanji on Toronto’s housing market

    October 2, 2025 · View original

    Riz Dhanji, who is the founder and president of RAD Marketing, is a long-time partner of ours. We are working together on One Delisle and on our waterfront project in the Niagara Benchlands. Riz has worked on some of Canada’s most high-profile development projects, has been through past cycles, and has even sold real estate to Elton John. That’s something.

    So today, I’m happy to share this recent Livabl podcast that he appeared on with host Matthew Slutsky.

    One theme that you’ll notice in the episode is the focus on end-user buyers. Talk to anyone in the condominium business and they’ll tell you that these are the few active buyers today. Investors are largely sitting on the sidelines. On the surface, this should be a healthy reset for the market — a refocusing on the actual customer. It’s also, in my opinion, a generational opportunity for buyers.

    But what I continue to find ironic is the number of end-users who also remain sidelined. For years, pundits loved to criticize Toronto’s new home market for being too geared toward investors. The argument was that it was a market based on speculation and that investors were crowding out real people from fulfilling their basic shelter needs. Developers were creating financial assets, not homes.

    Now the pundits have gotten exactly what they wanted: less speculation, less competition, and lower prices. So where, then, are all the end-users? Why are they not banging down the doors of sales galleries and saying, “Thank goodness — we’re no longer being crowded out?”

    Instead, what has happened is that the market has stalled out and new housing supply has largely shut off (the effects of which won’t be felt for a few more years).

    The question now is what will it look like once it returns. Who will be the buyers? Like every market, most people prefer to buy when everyone else is buying the same thing. So I suspect many end-users are waiting until there’s more activity (i.e. competition). But when that time comes, they won’t be the only buyers in the market.

  • Build Toronto advocates for congestion pricing

    September 26, 2025 · View original

    Back in the spring, I wrote about a platform called Build Canada. More recently, this same group launched their first “city project” called Build Toronto (which is not to be confused with the city corporation that ultimately became CreateTO). Similar to Build Canada, they publish regular memos and advocate for policies and projects that will help build Canada’s largest city.

    Their most recent memo is by the CEO of A2X, Jamie McDonald, and it covers a topic that we discuss a lot on this blog: congestion pricing. Jamie talks about the drag that congestion has on the region’s economy (upwards of $45 billion every year?), the numerous successes we can point to from around the world, and then lays out the following proposal:

    – Create a downtown congestion pricing zone – Introduce dynamic highway pricing across the GTA – Guarantee fairness and predictable exemptions – Invest in alternatives before launch

    This is the way. And it remains deeply disappointing that we don’t have the political leadership to move this forward. Instead, we sit in traffic. But after a decade of writing about it, I think I’ve said about all I can say about the virtues of congestion pricing. We absolutely know it works. Now we just need to spread the word and continue to apply pressure. I’m glad that groups like Build Toronto are helping to do exactly that.

  • Toronto is finally intensifying its neighborhoods

    September 22, 2025 · View original

    > Tweet: It’s happening. Toronto is intensifying its neighborhoods with fourplexes, fiveplexes, sixplexes, and laneway homes. https://t.co/ARCHTjWI65

    Bianca and I went for a walk around the Junction over the weekend, as we like to do, and I was pleasantly surprised to find a number of “multiplexes” under construction. That is, small infill rental projects with four or five homes, sometimes including a laneway house at the back. (Sorry, no sixplexes were spotted just yet.) It immediately made me think, “Wow, it’s happening! Toronto is intensifying its neighborhoods.”

    For those of you who haven’t been following closely, many of Toronto’s neighborhoods have been bleeding population over the past few decades. It’s only where we’ve allowed larger-scale new developments that we’ve really seen populations increase. That’s what has precipitated our current push to expand housing options in our low-rise neighborhoods. And already, you can find evidence that it’s starting to work.

    That said, it’s worth mentioning a few things. Some of the planning notice signs that I stumbled upon dated back to 2022, and some were current. This raises at least two lines of questions. One, why is a small project that went to the Committee of Adjustment in 2022 still under construction? Was it because of planning delays, or something else? And two, why are today’s projects still having to go to the CofA? Are we still not there yet in terms of the planning policies?

    I don’t know the precise answers to these questions, but I do know that planning staff actively monitor which variances are requested and ultimately approved. If the same variance continues to show up, then it’s a clear indication that it should just become policy, and not be something that needs to be sought. This should give some comfort that we should only get better at facilitating this scale of housing.