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.
One of the things that you need to do when you’re constructing a building is arrange for new utility connections. Sometimes there’s enough capacity to support what you’re building and sometimes the capacities need to be upgraded (which usually becomes the responsibility of the developer).
But according to this recent Financial Times article, some new applicants in west London are now being told that there won’t be “sufficient electrical capacity for a new connection” until, oh I don’t know, maybe 2035. And it could affect all new housing projects with 25 or more units.
This is a pretty wild piece of news. And it certainly won’t be good for overall housing supply. The three west London boroughs that are being impacted by this capacity issue were responsible for about 5,000 new homes between 2019-2020. That’s about 11% of London’s total housing supply.
So what and who is to blame for this? The Greater London Authority is saying that data centers are at least partially responsible. Too many new data centers in the area with high electrical loads.
I don’t know exactly what is going on here (maybe some of you do), but now feels like a good time to turn our attention to solar power. I recently visited a large 3,000 panel rooftop installation here in the Greater Toronto Area, and so naturally there is a blog post in the works. Stay tuned.
It is obvious that Toronto needs to find new ways to increase housing supply. And I have written before about how I think our major streets are a good place to look.
The above proposal by Naama Blonder of Smart Density is one way to start thinking about how we could do that. Dubbed the “mini mid-rise”, the idea here was to show how a single lot might be intensified with a small multi-unit building.
This is a great idea. It was one of five projects that just won the Ontario Association of Architects’ annual design challenge. But for it to have a chance at working, we’re going to need to remove all of the friction associated with building this kind of housing.
These would need to be permissible as-of-right. No rezoning. No site plan control. Just straight to building permit.
We would also need to eliminate all parking requirements (which we are thankfully doing). The market will very quickly correct if these homes cannot be rented without parking.
We would need to ensure that these homes can be built without any cooperation from the adjacent neighbors. Because that cooperation may not always be there.
We would need to ensure that there are no funny code requirements that might serve as an additional obstacle.
And we will probably also need to look at subsidies and other incentives so that these homes are economically feasible to build. This might include development charge waivers and/or tax abatements.
None of this is, of course, impossible. It’s just a question of how bad we want this to happen.
Here in Canada, there is often a belief that Americans tend to be more mobile than Canadians. Don’t like the cold weather? Just move south. Taxes too high? Just move south. Housing too expensive? Just move south.
But just how mobile is mobile? A new study by the US Census Bureau and Harvard University found that by age 26, more than 2/3 of young adults in the US actually just live where they grew up, with 80% living within 100 miles, and 90% living within 500 miles.
Migration distances were also found to be impacted by both race and parental income (though these two things likely exhibit a relationship on their own). If you are a young white or Asian adult, the “radius of economic opportunity” tends to grow and you’re more likely to live further away from where you grew up.
The most popular destinations overall are New York, Los Angeles, Washington, and Denver (in this order). And while New York and Los Angeles remain at the top regardless of who you are, San Antonio and Phoenix are top destinations for Hispanics, and San Francisco is a top destination for Asians.
Regardless, home appears to be a pretty sticky place.
But what about Canadians? Are we less mobile? Looking at net domestic migration rates, Canada saw 254,143 interprovincial migrants between 2018-2019, whereas the US saw just over a million between 2020-2021. So on a per capita basis, Canada’s rate is actually higher.
Statistics Canada also estimated earlier this year that as of July 1, 2016, somewhere around 4 million Canadians were living abroad — or about 11% of citizens. This is a much higher percentage compared to Americans.
Of those living abroad, roughly half are believed to have received their citizenship through descent, meaning they were born abroad to Canadian parents. About 1/3 are Canadian citizens by birth. And about 15% are naturalized citizens.
So it turns out that Canadians are in fact pretty mobile. We also seem to like going further afield.
Okay, so maybe this isn’t an entirely definitive guide. But the intent is to make this post a kind of working post. As new ideas emerge (from my end or from your ends), I will endeavor to update it, so that maybe one day it will become a bit more definitive. I also think it’s important to keep it a little crazy. Because housing affordability is clearly a tough problem to solve, so unless we start thinking differently and acting boldly, we may not get there.
Here goes.
Encourage new housing at all scales (low, mid, high)
“Upzone” all major streets and transit station areas
Allow multi-unit dwellings in low-rise neighborhoods and ensure that any applicable codes and/or policies are not creating unnecessary obstacles to building at this scale
Work to make the largest possible housing scale permissible on an as-of-right basis — that is, remove the rezoning process wherever possible and allow builders to go right to a building permit (a lengthy rezoning process can cost millions)
Avoid the use of inclusionary zoning policies that do not provide an equal offset or subsidy (such as a density bonus)
Ensure that any development charges and levies are commensurate with the burdens created by new housing and that existing property owners are funding their fair share through property taxes
Identify the areas that are NOT seeing new housing and then create incentives to make development feasible
Search for underutilized land and other opportunities to add new housing — no land parcel should be considered too small
Incentivize small-scale prototypes as a way to test out new ideas and foster innovation — specifically with respect to climate change and construction productivity
Eliminate all parking minimums – no ifs, ands, or buts
Depoliticize the planning process as much as possible — local politicians are not generally incentivized to encourage new housing
Eliminate the ability for individuals to block or significantly delay new housing
Ensure that there are enough staff to expeditiously review and process development and building permit applications — if builders are hiring “expediters” in the hopes of moving these things along, it means something is broken
Put in place strict response and issuance timelines for building permits
Bonus city staff (and anyone else who touches housing supply) based on the number of housing units approved and permitted each year
Design smaller and more urban-friendly garbage trucks so that less space is lost in every new housing development
Back in 2014, Amsterdam became the first city to have what is called a “night mayor.” The role of a night mayor is what the name suggests. They are intended to be the chief executive officer of a city’s nighttime economy. And so it was and it continues to be recognition that the night can be an important economic development tool.
This seemed to work out well for Amsterdam, which is why many other cities quickly followed suit with their own night mayor elections. During this time, a number of us here in Toronto also started advocating for our own nighttime CEO. (FYI, here is a link to the current night mayor of Amsterdam.)
But fast forward to today and the tone seems to have changed in Amsterdam. The city’s daytime mayor, Femke Halsema, is now actively concerned about over-tourism and, in particular, the way that some tourists behave when they check-in to Amsterdam.
We have to tackle two problems. The first problem is what I’d call the London problem: Our city is becoming too expensive. That is also part of being an international city and having many expats living here. But it has consequences for the middle classes. It’s very difficult to find a house in Amsterdam except for the highest incomes, so our middle class — teachers, police officers, people working in health care — are leaving the city. We’re very alert about it. For a city to survive in the long run you need social stability and people from middle or lower classes to also feel at home.
Our second problem is the Venice problem: The people who live here become estranged especially in the city center, because it’s no longer part of their city. We have to find a new balance, in being a home for people from Amsterdam and at the same time welcoming international visitors and tourists.
More specifically, the Venice problem seems to be a problem of behavior:
It’s not a form of tourism we welcome or don’t welcome — it’s a form of behavior. What we do not welcome is people who come here on a vacation from morals. They express a form of behavior they would not express at home. People coming here to lose their morals is a problem for us.
It is for this reason that the city is hoping to relocate its red light district to outside of the city center. The intention is not to get rid of it, or for the city to turn its back on its long history of tolerance, but it does want to move it somewhere else in the hopes that Amsterdam will become more associated with culture than hedonism.
But does moving it actually change any behaviors? If one were to develop a purpose-built “erotic center” from the ground up, is it even possible to make it more integrated with the broader city (minimize the Venice problem) and, to use the mayor’s words, make it more chic than what currently exists?
These are all exceedingly tough city building questions that can’t really be untangled from questions of morality.
For the full Bloomberg interview with mayor Halsema, click here.
In 1973, 580,000 mobile homes (or manufactured home as they are now called) shipped in the United States. This represented about 50% of the number of single-family housing starts that year, and about 22% of total housing starts. So they represented a significant chunk of the overall housing supply.
But following the collapse of the US housing market in 1974, an interesting thing happened. Manufactured homes never managed to reclaim their position in the stack. See above chart. Brian Potter, author of Construction Physics, puts forward a number of possible explanations for this, over here.
Some have speculated that it was the result of new code changes that ended up increasing costs. Some have speculated that it was because of a new requirement to include a steel chassis on the bottom of every home, which also increased costs, but more importantly stigmatized manufactured homes. It made them seem transient, whereas previously they were installed on permanent foundations.
There are also some theories that manufactured home production was harder hit during the economic downturn given that they had more fixed plant costs (compared to site-built homes with their variable labor costs).
But Brian’s current working theory is that it comes down to capital flows. Manufactured homes tend to cater to lower-income buyers and so supply, as the argument goes, has largely depended on “lax lending” practices being made available to them.
I’m not so sure that this is the only reason though. For one thing, multi-family housing starts have followed a somewhat similar trajectory to manufactured homes. We’ve certainly seen an increase in supply over the last decade, but we’ve never gotten back to that early 1970’s peak.
And so I wonder: How much of this is actually just the result of the single-family home hegemony? This is arguably what the market has historically wanted (look at the split pre-1973 in the above chart), and so perhaps we simply refocused our attention there and worked to make this housing type as accessible as possible to the masses.
I just ordered a copy of this book. So I haven’t read it yet. But I did just read this Q&A with the authors (and it clearly piqued interested). The central idea is that Tokyo — which is a massive city that is famous for somehow being both massive and exceedingly livable — is the product of something that the authors refer to as emergent urbanism.
What they mean by this is that Tokyo’s order, functionality, and livability is actually largely the result of emergent bottom-up actions, rather than top-down central planning. This isn’t to say that some top-down planning isn’t required for things like parks and transit. You still need some of that. But this is to say that Tokyo’s approach to urbanism is very different from what you’ll find in cities likes Paris and many others.
Here’s an example of what I’m talking about (taken from the above Q&A):
This is going to sound wild to anyone who lives in the US, but for any two-story rowhouse in Tokyo, the owner can by right operate a bar, a restaurant, a boutique, a small workshop on the ground floor — even in the most residential zoned sections of the city. That means you have an incredible supply of potential microspaces. Any elderly homeowner could decide to rent out the bottom floor of their place to some young kid who wants to start a coffee shop, for example. When you look at what we call yokocho alleyways — charming, dingy alleyways that grew out of the black markets post-World War II, which are some of the the most iconic and beloved sections of the city now — it’s all of these tiny little bars and restaurants just crammed into every available space.
What’s fascinating about all of this is that we’re talking about a kind of self-organizing urbanism. One that goes against everything that traditional city planning stands for. Using the above example, instead of saying that retail should go here, bars should go here, and residences should go only over here, Tokyo is basically saying you can do whatever you’d like.
If you’d like to open a tiny 4-seater bar that only serves Long Island iced teas to people wearing cosplay outfits on neon pink plastic chairs, you are free to do that. Oh, and by the way, we’re also going to make it a lot easier and cheaper for you to get a liquor license. This might sound chaotic, but it works for Tokyo. And it’s evidence that maybe a lot of our cities would be better off if only we let them be what they want to be.
Venture firm a16z just announced that it will be “moving its headquarters to the cloud.” At the same time, it announced 3 new offices in Miami Beach, New York, and Santa Monica. These will be in addition to their existing offices in Menlo Park and San Francisco.
Part of their argument is that hybrid work is weakening the network effects and agglomeration economies associated with being right in Silicon Valley. So they’ve deiced to be virtual, but still have offices where they can “materialize physically” when needed.
They acknowledge that physical presence is important for developing a company’s culture, building relationships, and helping entrepreneurs (their core business).
What’s interesting about all of this is that it’s further validation for Miami (Beach). Here is one of the most important venture firms out there saying that when they quickly materialize in real life, they want to be able to do that in Miami Beach.
It also raises some interesting questions. Because even if the network effects of Silicon Valley are weakening when it comes to tech, this announcement still speaks to the importance of agglomeration economies. These three new office locations were chosen for a reason.
It’s one thing to have bike lanes. And it’s another thing to have really generous bike lanes. The above video by Streetfilms does a good job of comparing Paris to New York City, and showing just how far Paris has come in terms of cycling infrastructure. Some of you might remember that in the fall of last year, Paris announced plans to become a “100% cycling city.” This was a follow-on to their plan vélo 2015-2020, which saw a doubling of the city’s bike lanes. The current plan, which covers 2021-2026, includes 130 km of new bike lanes and 52 km of pandemic lanes that have been (or will be) made permanent. But again, it’s one thing to have a lot of bike lanes. And it’s another thing to have a lot of wide bike lanes that look like the ones in this video.
I was on a panel last month with Jamie Miller, director of biomimicry at B+H Architects, and he remined me just how much I am fascinated by the use of biomimicry in architecture and engineering. Nature is pretty impressive and I think there’s a lot that we can learn from her.
Here is a recently completed example of what I’m talking about.
The project is the new Pinal County Attorney’s Office in Florence, Arizona (designed by DLR Group). What the team did here was try and emulate the skin of the saguaro cactus. That ultimately translated into vertical self-shading fins on the envelope of the building.
Here is some evidence suggesting that the fins are truly helping performance (via Urbanland):
And here is the explanation for why it works and why nature does this (also via Urbanland):
Sit in front of a saguaro cactus for an hour and you will see the way it protects itself and thrives in the intense desert heat. Its vertical fins provide continuous self-shading and redistribution of heat. This ability to self-shade breaks sunlight up into smaller areas that shift continually, preventing any one area of the cactus skin from overheating. This adaptation not only makes the saguaro viable, but also gives it a beautiful and distinct character. Creating a 3-D computer-generated model of a saguaro cactus and using a daylighting simulation model confirmed that no part of the plant received more than 15 to 20 minutes of direct sun at any one time, avoiding the possibility of sunburn.
