Category: Urbanism

• Market making for houses

  Matt Levine’s latest Money Stuff column does a good job explaining why a lot of smart people are trying to figure out a market-making model for homes (see companies such as Opendoor):

  People want to apply the market-making model to homes. This makes sense. Buying or selling a home is a long slow uncertain annoying process. The value of immediacy is high, especially for a seller. If you decide to sell your house and go to a website and spend 10 minutes filling out a form and then someone wires you cash for the value of your house, that is much much much better than hiring a broker and listing the house and holding open houses and so forth. You’d be willing to pay a market maker a lot for that immediacy. (By selling your house to the market maker at a discount.) And if the market maker is good at acquiring houses, then it will have a lot of inventory, which will make it a good seller of houses. If you want to buy a house, you will naturally go to the market maker’s website, because it’s where the houses are.

  Levine also explains why a market-making model is that much more difficult for homes compared to things like stocks. In a slowing/slumping housing market, it’s pretty easy to lose money as a market maker. (That is, unless you can somehow accurately predict that a slump is coming.)

  Last month, Opendoor lost money on 42% of its home transactions. This is a result of them buying homes from people when prices were X and then selling these homes many months later when prices were less than X.

  However, I’m not so sure that this has to be an existential problem. Opendoor’s primary value proposition is instant liquidity for homeowners. And this value proposition is at its strongest when the market is in fact slumping. Because the alternative — selling with a broker — is less attractive.

  So the current environment may eventually turn out to be a boon for Opendoor. Of course, we won’t know for a number of months.

  Full disclosure: I am long $OPEN. And yes, it is painful right now.

  2022.09.20

• Wooden sash windows only

  There is, of course, part of me that admires what King Charles III has been trying to do in Poundbury (a small master-planned community on the outskirts of Dorchester, England). It is a community that has deliberately rejected the modern suburban in favor of traditional main-street urbanism. It is denser than you’d expect. It has a mix of uses. And it has been generally designed around people, rather than the car.

  On the other hand, I could never ever live there:

  To live here is to live under Charles’s rules (it is not clear whether William intends to be more flexible). Currently, Poundbury residents are embroiled in a debate about windows: The Duchy says that only wooden sash windows are permitted. Many residents would like to replace theirs with vinyl or fibreglass windows, which are easier to maintain and, crucially, more energy-efficient – and Poundbury is theoretically a ecologically advanced town. So far, the Duchy is not willing to budge.

  The last thing I want in my life is someone telling me what kind of windows I can install and what kind of architectural styles are suitable. Messy and organic urbanism suits me just fine.

  2022.09.19

• A spectacular laneway retreat 11 years in the making

  

  The latest issue of Designlines magazine is about how Toronto is — finally — embracing laneway life. And one of the featured homes is none other than Mackay Laneway House. Pictured above is architect Gabriel Fain sitting on the front steps.

  As some of you will know, MLH took over a decade to get built. I first did a design for the house back in 2009. Laneway housing seemed like such an obvious opportunity, and so I designed a compact house that could fit neatly within the confines of my 25-foot-wide backyard.

  Technically, it was perfectly workable. But I could tell I was too early. After speaking with city staff, I immediately got the impression that this thing was not going to get approved. At least not now. So I shelved the project until 2017.

  By this time, it was clear that laneway housing was on its way to becoming a reality in Toronto. It was simply a matter of time. And so Gabriel Fain and I decided to come up with a new design and try our luck at the Committee of Adjustment (we needed, I think, over a dozen zoning variances).

  But it turns out that we were still too early. The project was immediately refused. After the decision, I had a few planning lawyers reach and offer to help me with a pro bono appeal. But I decided to wait until the new laneway policies came into force and the home could be built without any variances.

  And that’s exactly what we did. In the fall of 2020 we submitted for a building permit, and about 6 weeks later it arrived. The home was then built that winter and it went up on the market for rent in March 2021. It rented right away, even in the midst of intermittent COVID lockdowns.

  At this point, it’s hard to imagine that this form of housing was once illegal. Hundreds of permits have already been issued and this number is only going to increase. In fact, I believe that the humble laneway house is destined to become a defining characteristic of Toronto’s urban landscape.

  Toronto is finally embracing laneway life.

  2022.09.18

• Streets in the sky

  

  I went out this morning to grab coffee from around the corner and, on my way back home, I ran into two people in the elevator that, from what I could glean, had hit the same button in the elevator and then struck up a conversation. He asked if she had just recently moved into the building. She responded with no, and that she usually doesn’t see anyone else on their floor. He was surprised by this response and said that he knows everybody on the floor.

  Nearly a hundred years ago, architect Le Corbusier, as well as others, had the idea of creating “streets in the sky.” Perhaps the most famous example of this concept is his Unité d’Habitation in Marseille (pictured above). Now a UNESCO World Heritage building because of its role in the development of modernist architecture, the building houses five “streets”, two of which were intended to be fully-fledged shopping streets. These streets house(d) things like shops, restaurants, galleries, and even a hotel.

  Le Corbusier was famous for his desire to create machines for living in. And these streets in the sky were part of this philosophy. The idea was that by having all of the things you needed under one roof, you would then be able to live an efficient, productive, and enjoyable life. Architecture and design could do that for you.

  Of course, the other reason for this thinking was that we needed to get people away from cars. As the car became more commonplace in cities, conflicts arose. And architects began to grapple with how best to separate people and cars. One obvious solution was to simply lift people up and off the ground so that the street could be freed up for cars to do their thing. This was going to be the future.

  The pitfalls of this line of thinking have since then been widely documented. And today, I think it’s pretty clear that most cities are in fact taking the opposite approach. Instead of removing people, they are removing cars through pedestrianization projects. Some of these projects are temporary, but many are also permanent. This happening almost everywhere from Toronto to Sao Paulo.

  The other problem is that it’s extremely challenging to make retail uses work way up in the sky. And that’s why even second floor retail spaces often struggle compared to those on the ground floor. As I understand it, the non-residential tenancies in Marseille’s Unité d’Habitation have naturally evolved from being retail-centric to being more office-like. Supposedly you’ll now find architects and medical offices, which is not at all surprising.

  But that doesn’t mean that Le Corbusier’s instincts weren’t directionally right. We now have lots of examples of tall buildings housing an intense mix of uses and public functions. And in the case of multi-family buildings, the corridors do often serve as a kind of street. I happen to live off of one that houses our building’s amenities. And so in addition to just running into neighbors, I’ll often run into the odd birthday party or Sunday afternoon sumo-suit party. True story!

  It may not be the Champs-Élysées, but it is a kind of street for living.

  Photo by Bernd Dittrich on Unsplash

  2022.09.17

• France clamps down on “dark stores”

  One way to shop for things is to make a list of all the things you want and/or need, and then go to a location that sells as many of those things as possible. As I understand, this is more or less what people do when they go to a place like Costco.

  Another way to shop is to just order things piecemeal, and have them delivered to you when you want them and in the least amount of time possible. And it turns out that this latter option is pretty popular.

  It is popular because it involves (1) not going anywhere and (2) not having to make a list and think proactively about the things you may want and/or need in the future. But it does mean that we need specific infrastructure to support this method of consumption. Generally speaking you need urban spaces close to where people live and work, and you need people to transport the goods.

  I mention all of this because it has translated into two areas of concern within our cities: (1) we now have “dark spaces” that are embedded into urban areas but don’t have any public-facing components and (2) we now have throngs of delivery vehicles starting to annoy local communities.

  In fact, France has already responded with a new federal policy that is expected to reclassify “dark stores and “ghost kitchens” as warehouses. This is intended to give local municipalities the power to shutter these sorts of spaces. Part of the thinking is that we all did just fine before delivery apps, so why not just go back to doing what we were doing?

  My own view is that this shift in consumption is here to stay. And so we would be better served by figuring out how to respond in a way that is both sensitive to communities and that maintains the vibrancy of our urban environments. We also managed without things like refrigerated food and mobile phones, but I’m pretty happy to have these tools available to me.

  2022.09.14

• A conversation about families in condominiums

  

  I spent this morning filming a new short video for Junction House. My friends Adriana and Mateusz live in a beautiful boutique condominium building downtown. They are also raising their young daughter there, and using it as an office and design studio (he’s an architect). This is a story that we are looking to tell in a new campaign that we’ll be launching this fall, and so I very much appreciate them volunteering their time.

  We talk about this a lot on the blog, but there are deep cultural biases in Toronto (and throughout North America) around single-family housing. But that is changing. For a variety of reasons, more and more people are choosing to live in multi-family buildings and to raise families within them. We believe that there are many benefits to this lifestyle choice, and that it is ultimately a positive thing for our cities. So that’s what we were discussing this morning.

  Thank you both for your time, and thank you to Studio Haus for figuring out how to get the lighting right in a corner suite with copious amounts of natural light.

  2022.09.10

• The disproportionate impact of urban renewal projects on non-white families

  

  Here is an interesting chart from the New York Times explaining the disproportionate impact that highway and urban renewal projects have had on non-white families in the US. The x-axis is the non-white population share in 1950. And the y-axis is the percentage of displaced families that were non-white. What this means is that the diagonal dotted line through the middle represents a kind of racially balanced displacement.

  However, as you can tell from the graph, displacement from 1950 to 1966 was not balanced. In Providence, for example, only 3% of families were non-white in 1950. But these families represented 31% of the ones displaced for renewal projects. In Philadelphia, about 18% of families were non-white, but here they represented 71% of those displaced.

  I don’t think that this will be news to a lot of you. “Urban renewal” is a loaded term in American urbanism. But the article does do a great job of taking you back through time in cities like Houston, Chicago, and New York. The article is also by Adam Paul Susaneck, who is the founder of Segregation by Design. If you’re interested in this topic, I would encourage you to check out his website.

  2022.09.08

• CloudKitchens quietly expands across Latin America

  Despite having somewhere around 4,000 employees and being valued at upwards of $15 billion (2021 figure), CloudKitchens remains an incredibly secretive company. In 2020, it was reported that they had spent over $130 million in the preceding two years on properties in about two dozen cities, and this week the Financial Times reported that they have been quietly building “dark kitchens” across Latin America, alongside a new food and convenience goods business called Pik N’ Pak.

  The way this all supposedly works is that the “dark kitchens” prepare the food for delivery and pick-up takeaway, and any excess space within these buildings is used to store convenience goods like over-the-counter medicines and pet foods. I guess it is literally about picking and packing various items that you can then attach to takeout orders. In both cases, the food and goods are delivered to customers using local app companies such as Uber Eats.

  All of this appears to represent a shift in the supply chain for takeout food and various convenience goods. But what I am really curious about right now is what the real estate footprint of this network looks like within our cities. What is the optimal square footage of a ghost kitchen? What radius do they serve? And how does this ultimately change the landscape of our cities? I don’t know the answers to these questions, but change appears to be underway. Here’s an excerpt from the above FT article:

  “…the growth of dark kitchens across Latin America has caused controversy in certain cities. The proliferation in São Paulo, the largest city in the Americas, sparked objections from residents living nearby, with banners against new facilities appearing in well-heeled neighbourhoods. The town hall has proposed local regulation of dark kitchens and earlier this year placed a temporary ban on the issue of new licences. People have complained about noise, smells, smoke and motorcycle drivers — known colloquially as motoboys — waiting outside to collect orders. One unhappy local said his son had been nicknamed “bacon” and bullied in school because of the odour on his clothes, according to Cris Monteiro, a city councilwoman.”

  Travis Kalanick seems to have a knack for upsetting people and changing the way our cities operate. Although, the same could be said about a lot of other startups.

  2022.09.06

• Salt Lake City’s urban street grid

  Salt Lake City is not a walking city. The blocks are too big (660 feet x 660 feet) and the streets are too wide (132 feet) for that. This has translated into many of the streets have upwards of 6 lanes. To put this into further context, here is a block comparison chart from 99% Invisible:

  

  In the past, I have called this inheritance one of the greatest city building challenges. Because once you’ve designed a city around the car, it can be hard to move away from that. But as I have also said in the past, there are, of course, lots of things that can be done to make a place more hospitable to pedestrians.

  What is also interesting is that, according to 99% Invisible, the original intent for Salt Lake City’s urban grid was not for its large 660 x 660 blocks to serve as a rigid and immutable plan for the city. The intent was that its large blocks would be further subdivided into smaller blocks as the city grew and developed.

  Other than maybe a few examples, this never happened. Salt Lake City’s large blocks remain a defining characteristic of the city. But who is to say it’s too late for change?

  2022.09.03

• Are you sure you want Parisian-style urbanism?

  

  This might seem like a fairly benign tweet by Clive Doucet, a former Ottawa City Councillor. I mean, Paris is wonderful. It is livable, walkable, and my favorite city in the world after Toronto. But as I have argued many times before on the blog, there is a tendency to look at Paris’ uniform mid-rise buildings and then incorrectly try and translate it over to a North American (or other) context with opinions that we should simply cap building heights. Because if only we were to do that, then we would be left with our own version of beautiful Paris.

  This is false. And you should immediately call bullshit on anyone who suggests this might be the case. It ignores most of what Napoleon III and Haussmann did to Paris in the 19th century, and instead just cherry picks height so that it can be exported back home to oppose tall buildings. If we really and truly want Paris, then it is important to be reminded that, among many other things, the Paris we all love today is the result of:

  • The annexation of eleven surrounding communities (in order to form the city’s current boundaries)
  • Mass urban renewal, involving the displacement of some 350,000 people (according to some estimates at the time)
  • Nearly two decades of large-scale disruptive construction
  • The demolition of hundreds of old dilapidated buildings (some of which may have even been in a Heritage Conservation District — bad planning joke)
  • The cutting through of nearly 80 kilometers of new avenues all across the city
  • The building of high-density courtyard buildings and blocks

  As you might suspect, Parisians at the time were upset with this kind of large-scale change. The now famous Impressionist painters lamented the new monotony of Paris’ regular mid-rise blocks. Where had the unique and quirky Paris of past gone? It was, of course, being systematically erased in the name of modernization and urban renewal, which by the way, included a new and important water and sanitation network. What Napoleon III and Haussmann did was transform Paris from a crumbling medieval city into a modern metropolis.

  I am not suggesting that any of this is bad and shouldn’t have happened. Today, Paris is deeply loved the world over. But what I am suggesting is that if we truly want to create our own version of Paris, then we are going to need to be realistic with ourselves on what it is going to take to get there. It will require nothing short of massive change.

  If we want Paris and Paris-like densities (despite what Clive posits in his tweet, Paris is not the densest city in the world), we are going to need to be fully prepared to rip up and rethink our entire approach to zoning. Taller buildings are partially (largely?) a result of our cultural obsession with single-family houses. We restrict supply, codify low-densities, and then wonder why the remaining areas need to be so tall. We then grasp at out-of-context examples in order to justify our own selfish interests.

  If Paris is really what we want, then we must be prepared for everything that comes along with its pretty mid-rise buildings. Are you ready?

  Photo by Nil Castellví on Unsplash

  2022.08.28