I was reminded of this duality the other day while listening to a Scott Galloway podcast where he talked about his love for expensive hotels, and how he travels to hotels, not to places. This is a bit abnormal. Traditionally, people stay at a hotel because there are things they want to see and/or do in the place where the hotel happens to be located. Meaning they choose the place first, and then figure out where they're going to stay after.
But there is also a statistically significant percentage of travellers who work in the opposite direction. Scott seems to be one of them. Now, his examples were all at the highest end of the spectrum, and that makes intuitive sense. If your M.O. is to travel to hotels, and you're kind of agnostic to place, then presumably the hotels are going to be super nice. But I don't think this market segment only exists at the very top. I don't stay at the same kind of hotels as Scott, but I still love hotels.
One example that I have talked about before is Tuba Club in the south of Marseille. Bianca and I stayed here a few summers ago. We read somewhere that it was about to open, we loved the vibe, and so we organized our travel itinerary just so we could stay there. We ended up loving Marseille (so much so that we went back), but Tuba came first. It was the catalyst.
A local example I can give is the Drake Devonshire in Prince Edward County, Ontario. When it opened in 2014, "The County" was not on my radar. Maybe I had been there as a kid? I don't know. But as soon as it opened, I wanted to go, as did many others judging by the lack of room availability. The design by John Tong was a hospitality offering that just wasn't available in the rest of southern Ontario at the time.
This is a powerful position to be in for a hotel. Because it means that through some magical combination of design, brand, service, and experience, you have a product that people specifically want. They're not just stopping by and need a place to stay, they're actively seeking you out. This is not to say that location doesn't matter; it does. But it is to say that a highly-coveted offering that people love is always better to have than not.
And if you get it right, there's the opportunity that people will even choose you over place.
Update: A previous version of this post incorrectly stated that John Tong had passed away. John unfortunately had a severe stroke, but he did not pass away. Sorry, my mistake, John!
Cover photo by Toni Osmundson on Unsplash
The Missing Middle Initiative, which is a research group housed at the University of Ottawa's Institute for the Environment, just published this detailed report on Southern Ontario's housing affordability crisis.
As we know, things are not good: In 2005, 21 of 26 single-family house markets in Southern Ontario could have been classified as either affordable or deeply affordable for middle-class families, and none were unattainable.
Today, none of these markets can be considered affordable or deeply affordable, and 11 of them are now unattainable. In every single one of these markets, buyers should expect to pay 25% or more of their pre-tax income on mortgage payments.
Below is one of their charts showing the price-to-income ratios for single-family houses in various markets since 2005. Outside of the Greater Toronto Area, the turning point toward worsening affordability was generally in 2016, and the peak was in 2022.
Here's some historical context. Canadians who had mortgages in the late 70s and early 80s often like to talk about how crippling rates were back then. But interestingly enough, monthly payments — relative to wages — are actually worse today than they were during this high-rate period (according to the report).
This is partly because home prices were a lot lower back then and so high rates didn't have the same impact to mortgage payments. Instead, the two worst periods of time for affordability (payments relative to wages) were during the late 80s housing boom and then during/after the recent pandemic.
Following the real estate crash of the early 90s, monthly payments relative to wages declined along with home prices. And they didn't return to the same levels seen during the preceding boom until 2022 — some thirty years later.
The same thing is happening right now. This reset is naturally improving affordability. But it really should be viewed as an opportunity to course correct before the next cycle begins. MMI's report does a good job explaining that housing is objectively less affordable today than it was for prior generations.
Charts from the Missing Middle Initiative; cover photo by Victor Ballesteros on Unsplash
Neat B and I were in the Niagara wine region over the weekend and I was reminded of a few things:
Winemakers in Niagara will tell you that southern Ontario isn't the easiest of places to grow and make wine. But whatever, I think that Niagara is highly underrated. Niagara has some exceptional wineries that you really should explore if you aren't familiar. Ontario is also the largest ice wine producer in the world, by a long shot. We produce something like 90% of the world's supply. Ice wine can be a bit of an acquired taste -- they're sweet. But if you get a chance, try one from Stratus. They are supposedly the driest in the world.
I don't know how the wine demographics have shifted in other regions, but we were told over the weekend that 10 years ago it was mostly gray hairs who were out at wineries buying wine. Today, there are tons of young people in their 20s, 30s, and 40s. And we certainly saw that over the weekend. This shift has winemakers now adjusting their wines. I couldn't tell you what a younger wine palate wants, but apparently it's something.
Lastly, there is a complete lack of cool and modern boutique hotels in the area. I would imagine that part of this is because the Niagara wine region is still emerging. But I think the other reason has to do with my previous point: younger people now want to go to wineries and the hospitality sector hasn't yet caught up. This strikes me as a massive opportunity.