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: Travel

  • Do the best cities have a lot of immigrants?

    I tweeted this out last night while watching old reruns of Anthony Bourdain’s Parts Unknown series. This was a great show. If I were to give everything up and become a YouTuber, this is the kind of travel and food channel I would want to make, except that I would naturally have to add in some equal parts around architecture, planning, and real estate.

    The responses to my tweet were of course mixed. Some people agreed and some people didn’t. And a few people provided examples of great cities that aren’t particularly known for their openness to new entrants — places like Tokyo. This kind of response is not at all surprising given how divisive this topic has always been throughout history.

    But here’s what I was thinking:

    1/ There are some obvious current case studies. Consider places like Toronto and Miami, where foreign born residents now make up the majority of the population. These are two fast growing and dynamic cities that wouldn’t be anywhere near as interesting without their immigrant populations. Certainly the food wouldn’t be as good.

    2/ Many of the most beautiful cultures in the world are the result of different cultures coming together. Brazil is one example that comes to mind. Throughout history they have been one of the largest recipients of immigrants in the western hemisphere. Sadly, Brazil was also the last country in the western world to abolish slavery.

    3/ Rome and Tokyo were cited (in the comments) as two great cities that frankly aren’t all that diverse. According to Wikipedia, less than 10% of Rome’s population is non-Italian. But Rome, while nice, is provincial these days. And Tokyo, while awesome, has a bit of a demographic problem.

    4/ Even if you think a place doesn’t have a lot of immigrants and maybe isn’t all that diverse, it is still probably the result of diverse cultures coming together at multiple points throughout history. Maybe because of immigration. Or maybe because of something bad like war. Think of the Moors from northern Africa who crossed the Strait of Gibraltar and conquered the Iberian Peninsula.

    5/ An openness to new people could signal and probably does signal an openness to other things. And since we are living in a world that thrives on innovation and new ideas, being open strikes me as being a fairly good and useful characteristic to have.

    6/ Lastly, I come from a family of immigrants. I self-identify as being entirely Canadian. But I had to come from somewhere (multiple places, in fact). And so it strikes me as being odd and entirely selfish to want to block the flow of people now that I’m here and established.

    What are your thoughts?

  • Immersive digital experiences at Superblue Miami

    If you happen to find yourself in Miami or London in the near future, I would highly recommend that you check out Superblue. Neat B and I visited Superblue Miami this past weekend and it was an incredible experience.

    Above is a short video of one of the immersive installations (click here if you can’t see it embedded above). This one is by the Japanese art collective teamLab and what you’re seeing is a whole year’s worth of seasonal flowers coming to life and then dying off.

    It’s meant to show you the continuous change and cycle of life and death that we all live through every day, and you certainly feel that as you go through the space. The installation itself also responds to how you move and interact with it, with some actions encouraging more blossoms.

    It’s, of course, all very Instagrammable.

    But I think this descriptor is old news and doesn’t do the work justice. Superblue is a serious cultural experience. One of the other works on display right now is a piece by light and space artist James Turrell. And for this one, there were no photos and talking allowed. The timed experience was meant to be more meditative.

    It was the first time that I had seen something by James Turrell in real life and it didn’t disappoint. It made me feel things, as did the entire Superblue experience. So again, a top experience that I would highly recommend.

    On a related real estate note, the 50,000 sf Superblue space is located in an area of Miami called Allapattah (which is west of Wynwood and 5 miles east of MIA). I’m an outsider to the city building undercurrents of this city, but I keep hearing people talk about the area as the next Wynwood.

    The other cultural institution in Allapattah is the Rubell Museum, which I wrote about in 2019 as it was moving over from its original home in Wynwood. Supposedly the family now has the largest private collection of contemporary art in North America. So that’s something.

    Maybe these two anchors will be what does it for Allapattah. When we walked around the area there didn’t seem to be much else going on. But we all know how quickly that can change.

  • Love letter to Québec

    I watched this for the first time last night. It is the late and great Anthony Bourdain hanging out in Montréal and Québec City with two of Canada’s most respected chefs and restaurateurs: Dave McMillan and Fred Morin of the famed restaurant Joe Beef. Initially aired in 2013, it’s hard not to miss Bourdain when you watch it. And it’s also hard not to love Québec. This is an episode about humility, authenticity, good living, and, of course, some of the best food and drink in the world. Bourdain has a great line right before they visit Wilensky’s (in Le Plateau area of Montréal) where he says, “no matter how you feel about Québec as either separate or as an essential part of Canada, any reasonable person loves this place.” I couldn’t agree more.

    If you can’t see the embedded video above, click here.

  • What should Airbnb launch this year?

    At the beginning of this year, Brian Chesky, who is cofounder and CEO of Airbnb, took to Twitter to ask about what products, features, and/or services the company should launch this year. The thread is filled with all sorts of interesting ideas and suggestions, as well as many responses from Brian confirming the things that Airbnb is already working on, and so here it is:

    If you’re not a Twitter person or don’t feel like going through the entire thread, you can also check out this highlight summary from Skift. They went through and curated the ones that they liked. Some of the common suggestions included tools for co-living and remote working, tools for families and larger groups (like being able to cluster bookings in a particular area), and tools that help you meet locals and other guests.

    There were also a number of suggestions around a full blown travel advisory business, as well as property management services that could help small landlords service and maintain their places. This one seems pretty compelling to me because if your goal is to get as many places/hosts as possible, you probably want to make it as easy and frictionless as possible.

    It also helps to solve the operating scale problem that is inherent with most short-term rentals. If you’ve got one property, it can be costly to manage. But if you’re Airbnb and you have lots of listings in a particular submarket, then you have some economies of scale. Then again, they’re in about 100,000 cities. So maybe that’s a lot to manage. And maybe it’s too hotel-like for a company that is facing regulatory headwinds.

    Do you have any thoughts on what Airbnb should launch this year?

  • The “hotelization” of housing

    When I was younger and looking for any excuse to travel (I’m not sure this has changed), there were periods of time where I “lived” for weeks and months in hotels and in spaces that today we would characterize as co-living. I always liked the idea of living in a hotel. It was carefree. There were amenities. And you got to meet people from all around the world.

    Well it turns out that these kinds of living arrangements aren’t just attractive to poor university students. We have seen a proliferation of different living and hospitality concepts over the years, and I don’t see this trend slowing down. A recent example, which I just learned about via Globetrender, is “the Other House”. Their first location, pictured, above, is scheduled to open this spring in London’s South Kensington.

    The founder refers to it as a “residents’ club”, and the idea is for it to sit somewhere between a hotel, a serviced apartment, and your typical long-term apartment rental. Each “Club Flat” will have a separate living area and bedroom, as well as a kitchenette for cooking. And guests will be able to stay for as long as they would like — anywhere from one night to more than a year.

    Why this is potentially innovative is that the company is looking to combine the best of a few different worlds here. For example, hotels are great because they offer flexibility, amenities, and a carefree lifestyle, but they’re often missing the sense of belonging/home that you get from more conventional longer-term housing.

    The Other House hopes to fix this through what you might call the “hotelization” of residential real estate. They’re investing in design and in creating the right experience, but they’re also doing things like offering storage facilities for their residents. The idea here is that if you need to travel somewhere else for a few weeks, there’s a place to store all of your personal belongings so that everything is waiting for you when you return “home.”

    Pricing is still TBD. But supposedly the average room rate is anticipated to be around £250 per night, with rates obviously coming down for longer stays. I am curious to see how this concept does in London. While it is not entirely novel, it is decidedly urban. It is an another example of design, location, and experience being privileged over raw square footage.

    They don’t have much up on their website just yet. But if you’d like to follow them on the socials, you can do that over here.

    Image: The Other House

  • Which building or structure would you say best symbolizes Toronto?

    I tweeted this out last night:

    blogTO then picked it up and it got quite a bit of engagement.

    Some people, okay a lot of people, used it as an opportunity to be tongue in cheek and respond with things like: cheaply built condos, boarded up Starbuckses, Hooker Harvey’s, Drake’s house in the Bridle Path, the crumbling Gardiner Expressway, and that McDonald’s at the northwest corner of Queen and Spadina (this one is no longer a contender for me now that they’ve gotten rid of their walk-up window).

    Of course, there were also a lot of the usual suspects: The Sky Dome, The Gooderham Building (our miniature Flatiron Building), Casa Loma, The Royal Ontario Museum (specifically the expansion by Studio Libeskind), “New City Hall”, The Royal York Hotel, Honest Ed’s, The St. Lawrence Market, Robarts Library (University of Toronto), and a bunch of others that you might find displayed on the seat screen on your next Air Canada flight.

    But I’d like to unpack the initial question a bit more. Because what does it really mean for something to be a symbol of a city? And is there an important distinction between the symbols that resonate with locals on a personal level and the symbols that get exported around the world as a city’s brand and identity? Indeed, one of the criteria in most global city rankings is a prominent and recognizable skyline. Icons are important.

    Let’s consider an example. I agree entirely with Sean Marshall that “New City Hall” is a deeply symbolic building. Built in the early 1960s after decades of work, New City Hall was the outcome of an international design competition. And it was decidedly modern at a time when Toronto really wasn’t that modern. Montréal was the biggest and most global city in the country and multiculturalism hadn’t yet become a federal mandate. And so New City Hall symbolized our genuine ambitions to becoming something more.

    But does the rest of the world care? If you were to ask somebody my question on the streets of Rio de Janeiro or Tokyo, what would they say? What would they remember? The thing about most tall buildings or other city symbols is that they become abstractions. They turn into pictures on social media — like logos of a company. But maybe that’s all we can reasonably ask of the world. Maybe all that really matters is that a symbol has local significance; it’s then up to us to export it and tell that story to the rest of the world.

  • What happened in 2021 — a review of my predictions for the year

    On January 1st of this year, I wrote a post called, “My 2021 predictions.” It was part of a new practice that I have adopted where I try to forecast the year (I will be wrong) and then evaluate how I did at the end of it (the focus of today’s post). This year was, of course, a tricky year with lots of uncertainty. But here’s where my head was at in January and here’s what ultimately happened.

    Life will feel a lot more normal by spring/summer.

    This more or less happened. Cases, at least here in Ontario, were way down by the summer. Those who wanted to be fully vaccinated had the option to be. Cities reopened and summer felt pretty good after a long winter of lockdowns. As soon as it was possible to do so, we reopened our office and many/most people came back. I ended up being in the office this year more than I wasn’t. Of course, I had no idea that Omicron was going to be a thing back in January.

    Working from home/the office.

    I think the jury remains out on this one. It’s still too early to draw conclusions. I have been in the office full-time for most of this year, but I recognize that that hasn’t been the case for everyone. I know from the super scientific “Jimmy the Greek Reopening Index” that I developed that office utilization rates are not yet back. When I wrote about this topic back in October, the US average was thought to be just below 40%. Still, I remain bullish on office.

    An explosion of global travel.

    Well, Airbnb’s stock isn’t maybe as sky high as I suggested in my predictions post. But it is still up over 19% YTD:

    Marriott is also up nearly 27% YTD:

    The reality is that travel was/is rebounding. I managed to take two weeks off at the end of the summer, which is something I hadn’t done in at least several years. But Omicron has certainly impacted the recovery:

    Urban/downtown real estate will strongly rebound.

    I would argue that we saw this play out in the residential sector. Here in Toronto, Q3-2021 saw condo rents in the core increase 11.4% quarter-over-quarter. This was a fairly significant snapback. It was the largest increase in the region, outpacing both the inner suburbs and the outer suburbs. On the for-sale side, we saw evidence of the condo market returning as early as Q1. We were also able to successfully launch One Delisle and are now preparing to start construction.

    Trends accelerating.

    In some cases, what we saw was a reaction to short-term dislocation. Peloton’s stock is down about 73% YTD at the time of writing this. In other cases, what we saw was just a “pulling forward.” (Link to post by Fred Wilson.) The pandemic led to greater consumption of certain products and services, but now those companies could be headed for a period of slower growth. At the same time, there’s evidence that certain things, like buying more groceries online, may actually be sticking.

    Return of restaurants.

    What seems pretty clear is that people are quicker to return to bars & restaurants than they are to return to the office. As we know, getting together in person is fundamental to urban life. Here’s a chart from OpenTable:

    However, this is not to say that many restaurants didn’t have a tough go during this uncertain time.

    Public transit ridership will return to pre-pandemic levels by the fall.

    I was dead wrong and way too optimistic about this one. Office utilization rates remain lower than expected and so people aren’t commuting in nearly the same way. Those who are, seem to be driving more. As of August, Canada’s urban transit networks were operating, on average, at just over 40% of where they were pre-pandemic (August 2019). This is obviously a serious problem for operating shortfalls.

    Migration from high tax states to (warmer) low tax states.

    This is an established trend in the US and so it was certainly not a bold prediction. There are many other factors at play here beyond simply the pandemic. However, as I mentioned in my original post, what is perhaps more interesting right now is the heightened tension between centralization (urbanity) and decentralization. I’ll see what data I can uncover in the coming weeks, but we likely need to get to the other side of this pandemic before drawing any firm conclusions.

    In reviewing this year’s predictions it is clear that I was perhaps overly optimistic (which is far better than being overly pessimistic) and that missed a lot of important stuff. Some of it was unknowable, such as a new variant, and some of it I just missed, which is bound to happen. I could also be more precise and bolder in my predictions, and so I will endeavor to do that in my upcoming predictions for 2022. Stay tuned.

    If you’re not already an email subscriber to this blog, consider making that happen over here. And for those of you who have been reading all year, thank you. I truly appreciate it.

    Photo by Jamie Curd on Unsplash

  • Longer-term benefits of Airbnb for housing supply

    There is a commonly held view that short-term rentals (such as the ones you might find on platforms like Airbnb) are bad for housing affordability because they take long-term rentals out of the market and they help to drive up property values. And there’s evidence for this. A study published in Harvard Business Review found that home-sharing alone might be responsible for about 20% of the average annual rent increases across the US.

    Findings like these have encouraged municipalities around the world to put restrictions in place for STRs. But like most policy issues, there are nuances. And the thoughtful answers are rarely as obvious as they may initially seem. This has been part of my complaint around inclusionary zoning. It sounds good when politicians say it: let’s just get developers to build us free affordable housing. But again, there are nuances to consider.

    Short-term rentals are similar. A recent follow-up study that was again published in Harvard Business Review has actually uncovered some interesting longer-term benefits to STRs.

    Using residential permit data, Airbnb listings, and STR policies across the US, the team found that when you look over a longer time horizon, Airbnb listings actually tend to increase the supply of residential housing. On average, a 1% increase in Airbnb listings led to a 0.769% increase in permit applications. Supply is of course good for a whole host of reasons, one of which is boosting the local tax base.

    Conversely, they found that restricting STRs tended to reduce the supply of new housing and renovations. After new regulations were put in place affecting STRs, Airbnb listings fell on average by about 21% and residential permits fell by 10%.

    Restrictions also seem to have a direct impact on the construction of things like accessory dwelling units (laneway and garden suites for us here in Toronto). When analyzing data in and around the borders between jurisdictions in Los Angeles County, the researchers found that areas without STR regulations saw 17% more ADU permit applications compared to the areas that had restrictions.

    For the 15 US cities that the team studied, they conservatively estimated that STR restrictions reduced property values by about $2.8 billion and impacted tax revenues by about $40 million per year. Some cities, like Chicago, have also found success using STRs as an economic development strategy in distressed neighborhoods, which would further bolster the tax base.

    All of these findings suggest that a more nuanced approach to STR policies is probably merited.

    Photo by Andrea Davis on Unsplash

  • A few observations from Paris

    The last time I was in Paris was in 2006. That’s a long time ago and so it was great to be back in the city earlier this week. I don’t know the city as well as I do many other cities, but I speak enough French to be dangerous and we spent a good amount of time on this trip just exploring. On average, we clocked about 20,000 steps a day. So here’s a list of some of the things I was reminded of or learned of on this visit. If any of you are more familiar with the city, please feel free to speak up in the comment section below.

    • I love Paris.
    • The Parisian art of people watching is alive and well. One of my favorite things about Paris is how so much of the cafe seating faces out toward the street. That’s what you’re supposed to be watching: urban life.
    • Most cities have a clear message. In Los Angeles, it’s probably that you should be more famous. In Boston, it’s arguably that you should be smarter. And in New York, it is perhaps that you should be richer. In Paris, the message feels loud and clear: You should be more fashionable.
    • Compared to Toronto, the center of Paris feels far more static. Less construction. Less change. Less that is new. That’s not such a bad thing given how beautiful the city is. But in my view, cities are about balancing preservation and progress. From what I could tell, a lot of the new construction seemed to be happening in the suburbs and in the outskirts of the city.
    • That said, COVID feels much further along in Paris. The city was very open and everyone seemed to be back in the office. Locals said that the city was operating at maybe 80%. It felt busy.
    • Dress shoes are dead in Paris. Everyone wears cool sneakers no matter how young or old. Think business suits with Nike Air Maxes. My hypothesis is that it’s just far more practical given how much people walk in Paris. I plan to adopt this strategy immediately.
    • In addition to walking, everyone seemingly bikes and/or uses an electric scooter. Again, it didn’t seem to matter how young or old. Paris also seems to have solved the scooter clutter problem, as has many other cities. There are designated spots (painted lines next to on-street car parking) and that’s where you’ll find the scooters. Toronto needs to get on board.
    • Traveling at 300 km/h on a train is a highly civilized way to move between urban centers.
    • There’s nothing wrong with having a picnic and drinking a bottle of wine (or two) in a park. In fact, it is probably something that should be celebrated. Let people be grown-ups.
    • When you purchase a baguette, you should immediately take a bite out of it to see how fresh it is.
    • The Eiffel Tower, much like the CN Tower, looks far better when illuminated.
    • Balconies of any size can be wonderful. We had a small Juliet balcony off of our hotel room in Nice and we used it every day for croissant eating and to dry our bathing suits. In a more permanent situation, I am sure we would have started growing things on it.
    • Midrise buildings do indeed create nice urban street walls. But it’s important to keep in mind that Paris’ midrise blocks are also deep and dense and with lots of courtyard conditions. That’s how the city is able to house so many people at such low building heights.
    • Facing conditions between buildings is less of a concern when you employ less glass. Smaller punched windows allow you to better manage privacy. I would go so far as to argue that if Paris were an all-glass city, much of its current built form would be fairly unlivable.

    What did I miss in this list?

    Photo by Alexander Kagan on Unsplash

  • 👒 Jardin du Palais-Royal