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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  • People tend to prefer independent restaurants over chains

    I just came across the above chart from City Observatory showing the percentage of restaurants in each city that are part of a chain. (The data is taken from Yelp.) On the top is New York City, where only about 13% of restaurants in the city are a chain. And on the other end is Louisville, where more than 35% belong to a chain.

    The article also observes that there appears to be a correlation between restaurants per capita and the percentage of independents. In other words, the more restaurants you have, the higher the likelihood that more of them will be independents. New York City is once again at the top with 22 restaurants per 10,000 people.

    What is perhaps most interesting about this data is that Yelp ratings show a pretty clear preference for independent restaurants. Meaning that, on average, independent restaurants receive a higher rating compared to chain restaurants. At the same time, this spread seems to be widening. Here’s data from 2012 to 2017:

    This is maybe obvious; but it’s worth reiterating. As city builders, it’s good practice to encourage independent and small businesses. They are a competitive advantage. People, at least based on this Yelp data, seem to clearly like them more. So I guess Jane Jacobs was right: “The greatest asset a city can have is something that is different from every other place.”

    Charts: City Observatory

  • Thoughts on Dupont Street in Toronto

    This morning I spoke to the Globe and Mail about the evolving nature of Dupont Street here in Toronto. The impetus for the discussion was this: Dupont Street is now seeing a lot of residential intensification, but the street itself remains a bit of a crosstown highway. It’s not yet a “complete street.” And since Junction House is effectively on the west end of this midtown artery, John Lorinc asked to get my thoughts.

    The point I tried to make is that, in my opinion, this is first and foremost a zoning issue. Dupont Street is seeing intensification, but it is largely happening on the north side of the street, abutting the rail corridor (purple and red in the above Official Plan map). The south side of the street is, for the most part, a low-rise neighborhood (yellow in the above map).

    This kind of edge condition is somewhat unique in the city: low-rise on one side of the street; higher density housing, retail, and office on the other. But it is particularly problematic if you’re trying to create a great main street, because single-sided retail streets generally don’t work very well.

    We could certainly have a discussion about sidewalk widths, bike lanes, and other streetscape improvements; but in my mind, there is nothing inherently bad about the cross section of this street. The right-of-way width is 20 meters, meaning there are generally two lanes going in each direction. This is a dimension you’ll find all over the city, including on beloved streets like Queen Street.

    The problem here is what is abutting the street, and it is something that is systemic across the city: we have too many arterial roads that only allow for low-rise housing. So if you were to ask me what to do next, and I was asked this morning, the first thing I would do is up-zone the south side of Dupont and allow for non-residential uses at grade.

    And once this is done, I am certain it will snowball many other positive improvements.

  • Cream-colored walls and light-oak tables

    I don’t normally write about food on this blog. But hear me out. Yesterday was Bianca’s birthday and we had an incredible experience at Osteria Giulia. We sat at the bar, as we like to do, and everything was perfect: the food, the service, and the interiors.

    First, let’s talk about the food.

    Anchovies, grilled sourdough, and a lot of delicious butter:

    Endive, pear, burnt honey vinaigrette, toasted almonds, and ricotta:

    Ricotta filled pasta, mushrooms, and artichokes:

    Sea bass, leeks, artichokes, fava beans, and charred tomatoes:

    Now, let’s talk about the interiors. They were designed by Guido Costantino Projects. And to get a good feel for their approach, I suggest you first check out their Instagram and then move onto their website. They do really beautiful and calming work.

    Design always matters.

    And I’m pretty sure that the cream-colored stones and light-oak details made everything taste that much better last night. If you haven’t been and you get a chance, I would highly recommend you try Osteria Giulia. It’s now one of our favorites in the city.

    Happy birthday, Bianca!

  • Footings and foundations in Park City

    We poured the concrete footings/foundations for Parkview Mountain House this week. Above is a photo of the pour. We’re about two weeks behind schedule because of delays related to site works and excavation. (We’re building into the side of a mountain.) But I’m hopeful we can make it up once we finish concrete work and move on to wood framing next month.

    For those of you who like details, here’s a section showing the footing and retaining wall on the back of the property facing the slope of the mountain:

    Our tallest retaining wall is going to be 15 feet high, which, as I understand it, is more or less the maximum we could have done here without getting into more elaborate structural solutions (such as tiebacks). So the team spent a lot of time solving a design puzzle that involved the height of this retaining wall, the maximum allowable zoning height for the site, and our choice of established grade.

    Onward. More concrete to come and then we move to wood. It’s a race to get “closed in” before the snow starts up again.

  • Who should decide what new buildings look like?

    Is it the architect? The developer? Or perhaps the city? The correct answer, it would seem, is whoever has the most followers on social media:

    For the Norwegian branch of the social media movement Architectural Uprising, this revision was another feather in its cap. Founded in Sweden in 2014 as a public Facebook group, the Uprising is a collective of citizen design critics who object to what organizers call the “continued uglification” of developments in Nordic cities, and push for a return to classically informed design. With more than 100,000 social media followers across some 40 different branches, the group now serves as a significant platform for those who assert that the public, not just bureaucrats, architects, developers and property owners, ought to have a voice in the design of their built environments.

    As a developer and person who studied architecture, I find this frustrating. Imagine you’re a painter working in a busy public square. And every time somebody walks by and shouts a new criticism, you need to change your art. How would you feel about your work?

    Now assume that your painting is an expensive commission. Your clients just re-mortgaged their home to pay for it and they specifically asked you for a painting that looks like something from Henri Matisse’s “Blue Nudes” collection.

    Unfortunately, the crowd in the public square wasn’t a fan of the color blue or of abstract figures, and so you’ve instead rendered dozens of well-fed Renaissance figures sitting in a lively garden eating grapes. “Sorry, hope you like it. This is what the critics wanted.”

    Look, I may be stretching here. I fully appreciate that architecture is inherently a more public form of art than painting. I just think it’s important to give entrepreneurs, artists, and other creatives the freedom to experiment.

    If we force everyone to look toward the past, how will the misfits ever create the future?

    P.S. I have no issue with voting on publicly-funded architecture. I actually think that’s a good idea.

  • Geography of activity centers

    We need more “activity centers”. That is my takeaway from this report by Brookings.

    Activity centers are exactly what they sound like. But to be more specific, the definition used in the report is based on five categories of assets: community, tourism, consumption, institutional, and economic. And what the authors did was look at the relative concentration of each across the 110 metropolitan statistical areas (MSAs) in the US with at least 500,000 residents.

    They then came up with 3 different kinds of activity centers. Monocenters (blue in the above map), secondary centers (yellow), and primary centers (orange). Monocenters have, as you’d probably expect, a lot of one kind of asset. Secondary centers, on the other hand, have “some of at least two kinds of assets.” And primary centers have “a lot of at least two kinds of assets.”

    Looking at the above map, it is pretty clear — and not at all surprising — that Manhattan is, for the most part, one giant activity center. There is a lot going on. But this is not the typical condition. In the 110 metro areas looked at in the study, activity centers only occupy about 3% of land on average. The remaining 97% of land is, based on the above definition, a non-activity center.

    Why this matters is that activity centers punch above their weight. Despite representing a small land area, activity centers are home to 40% of all private sector jobs in the US. Supposedly, they also increase productivity (by an additional ~$1,723 per worker), yield higher property values (+26%), increase inclusivity, and reduce vehicle miles travelled.

    So yeah, more activity centers sounds like a good thing for our cities. Though as we have learned in recent years, we need to be careful with monocenters.

    Map: Brookings

  • Phase one of Montreal’s REM is now open

    The first phase of Montreal’s new Réseau express métropolitain (or REM) just opened it up. It is a 17 km light-rail line that includes five stations running from Brossard in the south (A1 above) to Gare Centrale in downtown Montreal. Eventually this network — which is distinct from but connected to the city’s existing metro network operated by STM — will span 67 kilometers and have a total of 26 stations. To put this into perspective, Montreal’s current metro totals 69.2 kms. So this is a near doubling.

    As with most big city building projects, Montreal’s REM is being and will continue to be criticized. Back in 2016, the project had an estimated total project cost of $5.9 billion. By 2021, this number had increased to $6.9 billion. Today, who knows what the number will be. But it will be more. The reality is that everything went up, by a lot, over the last five years. During the pandemic, we were seeing 30-40% cost increases on some of our construction line items.

    What’s perhaps most noteworthy about this project is its delivery model. It is being delivered through a partnership with the the Caisse de dépôt et placement du Québec (CDPQ):

    Under the pact, the Caisse’s infrastructure arm is assuming $3.5-billion of the project’s $6.9-billion construction cost while Quebec is committing $1.28-billion and the Canada Infrastructure Bank is providing a $1.28-billion loan. The balance consists of a $295-million payment from Hydro-Québec for the line’s electrification, while the Autorité régionale de transport métropolitain, the transit authority for the Montreal region, is pledging $512-million.

    Provincial and local governments will provide continuing operating subsidies for the REM to make sure the Caisse earns its required return on the project, currently pegged at 8 to 9 per cent. The pension fund manager will get 72 cents for each passenger-kilometre travelled on the light rail system. Without such a subsidy, fares would climb to a level few passengers could afford.

    It’ll be interesting to see how this approach stands the test of time. As I understand it, CDPQ wants to continue building and operating transit in other cities around the world. I don’t know any of the specifics other than what I have read online. But from the outside, things seem to be working. The first phase of the REM broke ground in April 2018, and the opening ceremony was held this month (July 2023). That’s basically warp speed in transit timelines.

    Map: Montreal REM

  • Junction House by Air Norm

    If you work in the development industry in Toronto, then you know, or know of, Norm Li. He runs one of the top visual content studios in the city and the country. But he (and the company) also do a bunch of other things like DJ at industry events and fly around in a helicopter taking incredible photos of the city from above. He invited me to join him in 2018 and I captured photos like these.

    This past week he sent me a text with the below photos of Junction House and a message saying, “new lock screen.” I, of course, immediately blasted them around to the team and then asked if I could post them online. I love how these turned out. And every time I see our placemaking sign, I am happy that we fought for what we all believed would end up looking pretty cool.

    Thanks for the photos, Norm.

  • Developing, operating, and owning lagoons

    Here is a company that I just discovered called, The Lagoon Development Company. What they do is develop, operate, and own large-scale lagoons for both swimming and water sports.

    From what I can glean from their website, they make money by selling access tickets to these lagoons and/or by partnering with other developers on master-planned communities.

    In this latter scenario, I would imagine this means fee revenue upfront, with the ongoing operations then getting funded, at least partially, by the communities where they are housed.

    From the videos they have online, these lagoons look very impressive. I think they’re some of the largest ever developed. But at the end of the day, these are artificial lagoons, and so I’m expecting there to be mixed opinions.

    Would you want to see something like this developed in your city? And if it did exist, would you pay to go? I would.

  • A worsening housing shortage is expected

    Last month we spoke about how our current economic environment is going to negatively impact housing supply in the short-term. Now here’s some further evidence for this argument (via Bloomberg):

    “As rates started ticking up, the faucet started to turn off,” says Jonathan Gertman, senior vice president for development at the NRP Group, one of the largest multifamily housing developers in the country. “The number of projects starting this year already has been cut significantly. Anything that started in 2022, in most of the country, comes online 18 to 24 months later. So by the middle of 2025, you see that new supply start to go down significantly.”

    This is also being reflected in Federal Housing Administration (FHA) loan applications for new multi-family housing:

    Or put another way: FHA multifamily loan applications are on track to total as much as $18 billion for FY 2023, compared with $29 billion for FY 2022, $51 billion for FY 2021 and $45 billion for FY 2020.

    The above article is specifically talking about a looming affordable housing shortage. But these exact same headwinds are also impacting new market-rate housing. Of course, there’s always a lag when it comes to development. So it’ll likely be a few years until we really feel the impacts.