Dylan Reid recently wrote an interesting article about, what he calls, high low-rise infill buildings along Toronto’s main streets.
He describes the typology in this way: “These are generally 4-storey mixed-use buildings built quickly on one or two lots, replacing smaller previous buildings. They are often inserted beside existing, attached buildings.“
Now, Reid acknowledges that this a challenging scale to develop at. He links to one of my articles in Urban Capital’s Site Magazine where I talk about exactly that: the diseconomies of scale associated with building small. (Though, I was talking about mid-rise, not high low-rise.)
Reid addresses these challenges with a number of potential cost savings, including no parking minimums and no rezoning process. He also suggests that these projects may be better suited to existing landowners (who may own the land free and clear of a mortgage).
Getting rid of parking minimums and streamlining approvals would certainly help, though I remain doubtful about overall feasibility. But what I wanted to comment on today was the last point about these projects being better suited to existing landowners.
Dylan Reid recently wrote an interesting article about, what he calls, high low-rise infill buildings along Toronto’s main streets.
He describes the typology in this way: “These are generally 4-storey mixed-use buildings built quickly on one or two lots, replacing smaller previous buildings. They are often inserted beside existing, attached buildings.“
Now, Reid acknowledges that this a challenging scale to develop at. He links to one of my articles in Urban Capital’s Site Magazine where I talk about exactly that: the diseconomies of scale associated with building small. (Though, I was talking about mid-rise, not high low-rise.)
Reid addresses these challenges with a number of potential cost savings, including no parking minimums and no rezoning process. He also suggests that these projects may be better suited to existing landowners (who may own the land free and clear of a mortgage).
Getting rid of parking minimums and streamlining approvals would certainly help, though I remain doubtful about overall feasibility. But what I wanted to comment on today was the last point about these projects being better suited to existing landowners.
One problem with this line of thinking is that if we’re talking about land on a street where greater densities such as mid-rise are also permissible, the land is going to get valued based on mid-rise and not high low-rise.
So when a prudent landowner thinks about developing their land, they may also consider the opportunity cost of simply selling their land based on its highest and best use.
That thought process might go something like this. I own a piece of land. If I were to sell this land today and take on no development risk, I could make $X. If I were to instead develop this land, I could make $Y.
If $Y is less than $X, then I’m obviously not going to develop. But if the spread between $Y and $X isn’t enough to compensate me for the risk of developing (and there’s lots of risk in developing), then I’m also not going to do it. (Developers run a similar test by marking the land cost in their pro forma to market.)
And if $X is based on greater densities than $Y ($X is based on mid-rise densities and $Y is based on high low-rise densities) and if $Y is also being challenged by further diseconomies of scale, then I’m sure you can start to see how the math may not pencil.
I say all of this not to shit on Reid’s article. It’s a good article. You should go read it. And we should all continue to think about ways to increase the supply of housing in this city and in others.
Earlier this year I wrote about the California housing bill (827) intended to dramatically increase housing supply around transit stations all across the state. Well that bill was rejected last month and the Los Angeles Times wrote this post post-mortem explaining why and how it went wrong. Their argument is that it came down to opposition from low-income residents who feared that an increase in housing supply would lead to greater displacement.
On a related note, the Official Plan Amendment and Zoning By-law Amendment that would permit laneway suites in Toronto went to Community Council this week. They voted to defer the decision for a month. Only 3 of 13 councillors voted to pass the proposal, despite there being 185 letters of support and only 4 letters of opposition. For more information on what the hell happened, check out this Lanescape post.
One problem with this line of thinking is that if we’re talking about land on a street where greater densities such as mid-rise are also permissible, the land is going to get valued based on mid-rise and not high low-rise.
So when a prudent landowner thinks about developing their land, they may also consider the opportunity cost of simply selling their land based on its highest and best use.
That thought process might go something like this. I own a piece of land. If I were to sell this land today and take on no development risk, I could make $X. If I were to instead develop this land, I could make $Y.
If $Y is less than $X, then I’m obviously not going to develop. But if the spread between $Y and $X isn’t enough to compensate me for the risk of developing (and there’s lots of risk in developing), then I’m also not going to do it. (Developers run a similar test by marking the land cost in their pro forma to market.)
And if $X is based on greater densities than $Y ($X is based on mid-rise densities and $Y is based on high low-rise densities) and if $Y is also being challenged by further diseconomies of scale, then I’m sure you can start to see how the math may not pencil.
I say all of this not to shit on Reid’s article. It’s a good article. You should go read it. And we should all continue to think about ways to increase the supply of housing in this city and in others.
Earlier this year I wrote about the California housing bill (827) intended to dramatically increase housing supply around transit stations all across the state. Well that bill was rejected last month and the Los Angeles Times wrote this post post-mortem explaining why and how it went wrong. Their argument is that it came down to opposition from low-income residents who feared that an increase in housing supply would lead to greater displacement.
On a related note, the Official Plan Amendment and Zoning By-law Amendment that would permit laneway suites in Toronto went to Community Council this week. They voted to defer the decision for a month. Only 3 of 13 councillors voted to pass the proposal, despite there being 185 letters of support and only 4 letters of opposition. For more information on what the hell happened, check out this Lanescape post.
Last week I had something delivered from Amazon almost every single day. They weren’t necessarily big things though. One day it was a new corn broom for the patio. Another day it was a small set of hooks that I wanted to hang some lights. And the list goes on.
This is what Amazon wants us to do. Order every little thing, instantly, as soon as you think about it. And it’s magically convenient.
Developers and architects are of course thinking about the implications of this shifting shopping habit on new residential developments. Usually it comes in the form of a large “Amazon room” and/or a parcel locker system.
I recently measured the package room in my building (geeky, I know). It’s about 10′ x 6′ and it sometimes isn’t enough for the volume of daily packages generated by ~360 units.
The other thing that happened last week is that my concierge said to me: “Brandon, we have become a full fledge post office with the amount of packages that come through here every day.” Every evening there’s a lineup of people waiting to collect their packages.
That immediately signaled to me that simply providing a larger room probably isn’t enough. This trend is only going to continue. How could we better design and optimize for this shift?
I am sure that there many companies working on this problem. Hopefully they will surface in the comments and in my inbox following this post.
Last week I had something delivered from Amazon almost every single day. They weren’t necessarily big things though. One day it was a new corn broom for the patio. Another day it was a small set of hooks that I wanted to hang some lights. And the list goes on.
This is what Amazon wants us to do. Order every little thing, instantly, as soon as you think about it. And it’s magically convenient.
Developers and architects are of course thinking about the implications of this shifting shopping habit on new residential developments. Usually it comes in the form of a large “Amazon room” and/or a parcel locker system.
I recently measured the package room in my building (geeky, I know). It’s about 10′ x 6′ and it sometimes isn’t enough for the volume of daily packages generated by ~360 units.
The other thing that happened last week is that my concierge said to me: “Brandon, we have become a full fledge post office with the amount of packages that come through here every day.” Every evening there’s a lineup of people waiting to collect their packages.
That immediately signaled to me that simply providing a larger room probably isn’t enough. This trend is only going to continue. How could we better design and optimize for this shift?
I am sure that there many companies working on this problem. Hopefully they will surface in the comments and in my inbox following this post.
