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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  • A new 15-minute city is being developed near Salt Lake City

    In 2018, the Utah State Legislature passed a bill creating a new land authority to guide the future development of 600 acres of state-owned land in Draper, Utah (just south of Salt Lake City). It’s near an area called The Point of the Mountain and so that’s what’s this project is now being called — The Point. Here’s a map to help you get situated:

    In addition to this being a big and meaningful development opportunity with an estimated 7,400 new households being contemplated, the land authority also wants this to become an innovation hub and a model “15-minute city.”

    There has been a lot of talk about 15-minute cities over the course of this pandemic, but the idea is simply to have all/most of your daily needs within walking distance of where you live and to not have to always rely on a car. This is a difficult thing to achieve in many cities, but I think it’s one the greatest urban amenities out there.

    A big part of this is creating the right street network and planning for enough density, which is why this can be so challenging to do after the fact. Street grids, in particular, tend to be extremely sticky and mostly immutable. In this case, the plan is to create car free zones (or limited vehicle zones) across the various centers of the development.

    Developing walkable communities from scratch is a lot harder than slotting into existing urban fabrics, particularly when you have a contrasting context all around it. You have to get a bunch of different things right for it to be successful. But we continue to see lot more of these urban-focused masterplanning efforts and I think the trend will only continue.

    If you’re a developer who would like to participate in The Point, the RFP door is currently open.

  • Brampton is building a ton of secondary suites

    Here is an interesting housing chart from Ryerson University’s Centre for Urban Research (CUR) using data from CMHC:

    What it shows is (1) the number of new housing using created through the addition of secondary suites, such as basement apartments and laneway suites; (2) the number of housing units lost to demolition or “deconversions”, such as when a duplex or triplex gets converted (back) to a single-family home; and then (3) the net new units added over the last three years.

    In looking at the chart, you’ll see that the City of Toronto actually lost about 2,000 units from its existing housing stock between 2019 and 2021. Again, these numbers only consider what’s happening in the city’s existing low-rise residential housing stock. They don’t factor any of the housing supply being delivered through new condominiums and multi-family apartments.

    Still, it’s evidence for something that is perhaps already well known: many of Toronto’s low-rise neighborhoods are losing people. They are losing people because the existing structures are housing fewer residents and they are losing people because we make it difficult to build new housing. We want them to be “stable.” But stable built form doesn’t necessarily mean that things aren’t changing on the inside.

    Now compare this to what’s happening in Brampton (a suburb of Toronto). CUR is calling Brampton the land of secondary suites. Over the last three years, it added nearly 11,000 housing units and was on pace (at the time the data was published) to create nearly 6,000 last year alone (most of which are basement apartments). This is all within its existing housing stock.

    With all of this, I think there’s an interesting question about about how much of this is being driven by market demand and how much of this is being driven by land use policies. There’s obviously demand for expensive single-family homes in Toronto, which is why “deconversions” are happening. But to what extent does this change if/when we become more permissive around multi-unit dwellings?

    I think it depends on how we craft the policies.

  • Buy and hold

    I know that this is supposed to be a blog about building cities, but it’s also a blog about real estate and I have heard that people sometimes do things like invest in real estate. So here is a terrific memo by Howard Marks (of Oaktree Capital Management) about when to sell assets (and when not to sell assets). His overarching argument is that, most of the time, staying invested is ultimately the most important thing. But that it can be difficult to do.

    Here’s an excerpt:

    When you find an investment with the potential to compound over a long period, one of the hardest things is to be patient and maintain your position as long as doing so is warranted based on the prospective return and risk. Investors can easily be moved to sell by news, emotion, the fact that they’ve made a lot of money to date, or the excitement of a new, seemingly more promising idea.

    Howard is talking about the stock market and his words of advice are particularly important in that context given how easy it is to be a “trader.” I can, so maybe I should. But the same lessons hold true for real estate, even though it is a less liquid asset. A lot of wealth has been generated over the years by those who simply bought well and held for the long term. One good decision and patience can go a long way.

  • What is a beautiful place?

    The UK has something called the National Model Design Code. The purpose of this national code is to provide guidance to local authorities and communities on the production of policies that promote successful design. More specifically, it is intended to help people determine what “good quality design looks like in their area.”

    So as part of this, the code wades into subjective things like beauty, attractiveness, and distinctiveness (see above chart). This is an interesting discussion — and a topic in this recent Monocle radio episode — because, at the end of the day, is there really such a thing as universal beauty? Can we all agree on what the most beautifully designed places in the world are?

    At the same time, and architect Félicie Krikler points this out in the Monocle episode, there are countless examples of ugly places that are still wildly successful by all other urban measures. Is that okay or should they also be beautiful? And if budgets are tight (they always are), is it better to be a beautiful building or to be a more affordable one? Uh oh.

    There is also a temporal consideration. Sometimes the things that were once thought to be ugly are now actually thought to be quite beautiful. Beauty can take time, and places sometimes take time to settle in and find their best uses. This is something that I have written about a few times before on the blog.

    All of this being said, I believe wholeheartedly in the importance of beautiful places. And I don’t think we talk enough about it. Too often we get hung up on esoteric planning stuff, even though so many of the places that we love would never meet these same tests. However subjective as it may be, more beauty is rarely a bad thing.

    Image: National Model Design Code

  • 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?

  • Informal settlements are the desire lines of housing

    Toronto’s new garden suite (accessory dwelling unit) policies are headed to Planning and Housing Committee this week for approval. If you’d like to leave a supportive comment, you can do that over here by clicking “submit comments” at the top of the page. I just finished doing exactly that.

    Given that this is happening, I figured I would share this related article from the New York Times talking about ADUs and informal housing in Los Angeles. I discovered it through this Strong Towns article by Jay Strange. And I love how he refers to informal structures as the “desire paths” of housing.

    Desire paths, for those of you who may be unfamiliar, are the naturally formed paths and lines that get created when people just walk where they want to walk. Usually these are the shortest and/or most logical routes and, by definition, they don’t align with any designed paths or walkways.

    Jay’s point with informal housing is that it is similarly what people actually want to do, but maybe can’t, usually because of restrictive zoning and/or building codes.

    The New York Times gives the example of a family that illegally built an accessory dwelling unit at the back of their house in the 1990s. It was rented to friends and family, and it helped them get through some difficult financial times. But again, it wasn’t lawful.

    According to some researchers at UCLA, Los Angeles County is estimated to have some 200,000 informal units. Many are forced into demolition, but many, like the above example, manage to sneak under the radar because lots of other people are building them and nobody in the community wants to disrupt things.

    Of course, Los Angeles now allows backyard cottages. And so what was once illegal is now not only permitted, but encouraged. Funny, isn’t it? I don’t know if it was the “desire housing” that ultimately made it happen. But it is clear that many people wanted it and they were voting with their actions.

  • The century of gasoline vehicles is coming to an end

    Chrysler announced last week that it will become an all-electric vehicle company by 2028. This is a pretty big deal and, as I understand it, a first for the legacy US automakers. At this point, it now feels difficult to argue that this shift isn’t going to happen. Though I remember lots of people in the past asserting that the masses would never ever switch over to electric.

    I guess that’s the status quo bias at work. Because if you flip the script and assume that the status quo is already electric (that is, we all come home after work, plug in our cars, and charge them up at low rates), it would be pretty hard to argue for a switch to gasoline-powered cars. Here, try this new thing. It’ll cost you more to fill up and you get to pollute the environment more. But hey, it sounds cool when you do a cold start.

    Do we have Tesla to thank for exposing this?

    Here’s some further evidence from the Exponential View.

    In the UK last month (December 2021), 41% of new car registrations were electric or some kind of plug-in electric hybrid. That is up from 29% for the same period in 2020 (see above). Pure EVs also make up about 2/3 of these registrations and look to be picking up momentum. That’s certainly what I would expect to see when we revisit these numbers next year. The century of gasoline vehicles is coming to an end and it’s going to happen well inside of this decade.

    When I was buying a new car back in 2018, I wanted to buy an electric vehicle. I don’t have a charging station in my parking garage, but I would have gotten one. The problem is that I couldn’t find the kind of car that I wanted in an electric version. And the ones that were available were pretty expensive. That has changed and is no longer the case. If I were buying today, it would certainly be an EV. The car would also have to change colors at the push of a button.

    But, of course, the other element of change here is autonomy. And if/when that arrives, it will be far more disruptive than this shift to electric.

  • Robotic furniture startup Ori partners with Marriott Hotels

    Space-saving transformational furniture isn’t necessarily a new thing. We’ve all seen a murphy bed. And people like Graham Hill (of LifeEdited) have been designing and building out small urban apartments that magically transform for what seems like a decade. Perhaps it’s even longer than that.

    But I wouldn’t say that robotic and transforming furniture has hit the mainstream yet. There is, however, an argument to be made that it’s kind of inevitable. As the price of construction and housing continues to increase, there will be a continued push to do more with less space.

    Enter companies like Ori, which offer robotic and tech-enabled furniture for both end-users, as well as developers. Ori is already in 57 buildings across the US and, at this year’s Consumer Electronics Show (CES), it was also announced that they have partnered with Marriott to start rolling out their furniture in the hotel space.

    This to me feels like a perfect use case.

  • Toward more multi-family housing

    This recent article by Brookings is a good reminder of the all too important link between land use policies/patterns and GHG emissions. Because electric vehicles are cool and all, but they’re still not as efficient as just walking around and/or taking transit.

    As has been argued before on this blog, we need to not only electrify our transport network, but we also need to change how we get around. And probably the best way to encourage a modal shift, is to plan and build our cities differently. Something that is simple, but not easy.

    It also turns out that people who live in multi-family buildings tend to consume less energy (on a per capita basis) than those in single-family houses. So there are numerous benefits to encouraging denser housing on top of transit and within mixed-used communities.

    With all of this in mind, here are some interesting charts from the above Brookings article.

    This first one shows new housing permits in the metro areas of Atlanta, Chicago, and Washington DC, according to their urban, suburban, or exurban status. Here, Chicago is an outlier, with the “urban core” (defined as Cook County) now making up about half of all new housing.

    If you look at the entire study period, the number is less. The urban core accounted for about one-third of new housing permits in Chicago, and only 15% of permits in Atlanta and DC. But in all cases, housing permits in the urban core have been increasing since the 2008 financial crisis.

    But here’s the other thing. Looking at these next two charts, there appears to be a clear trendline toward more urban housing typologies. The first of these next two is showing single-family housing permits as a percentage of all new housing. And the second is structure type over time.

    Atlanta is still building mostly single-family housing, but less of it. And based on these charts, Chicago has already passed its inflection point. DC is not far off. Every city region is of course going to be different, but it does look like there is some kind of broader housing shift underway.

  • Neighborhood retail in residential Calgary

    I have written, many times over the years, about small-scale commercial uses in residential neighborhoods. Here in Toronto, they are generally not permitted. The small convenience stores and bodegas that remain are often legal non-conforming uses.

    Today I came across a great example from Calgary. I don’t know if it was done on an as-of-right basis or if variances were needed, but it is an example of small-scale commercial on a site that used to be low-rise residential.

    Here is the before (from street view):

    Here is the after:

    And here are a few more photos from the developer:

    Developed by RNDSQR and designed by FAAS Architecture, the project houses three street front commercial units that are now leased — according to their website — to an ice cream shop, a coffee shop, and a pizza + wine bar. The second flour houses office space.

    Congratulations to the team behind this development. It looks like a terrific project. And in my view, being able to leave your home and walk to things is one of the greatest urban amenities out there.