Google Earth has a feature called Timelapse that combines millions of different satellite images to show you how the world has changed over the last 37 years — sometimes for the better and sometimes for the worse. It’s a feature that’s been out for a few years, but they just made it available in 3D. Some of you may have also missed the feature if you don’t normally use Google Earth. So here’s an overly wondrous video (also embedded above) showing off the new feature, and here is a dedicated site that allows you to quickly try out Timelapse in 2D. Dubai’s “coastal expansion” is one of the places you can quickly land on and its growth over the last few decades is always mind boggling to see. But of course, there are also many other important Timelapses that should be viewed. A number of them speak to our environmental impacts on the world.
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Essential food logistics
Blair Welch, co-founding partner of Slate Asset Management, was recently interviewed by Don Wilcox of RENX about the company’s recent acquisition of the Commercial Real Estate Business of New York-based Annaly Capital Management. As part of the deal, we also acquired $0.4 billion of grocery-anchored real estate assets across the US. These were purchased by Slate Grocery REIT (TSX: SGR.UN). What some of you maybe don’t know, though, is how we as a company view these kinds of assets as being essential food infrastructure, more so than as being retail assets. So here are a few excerpts from the article and quotes from Blair that explain why, in our view, this distinction matters.
“We started buying grocery-anchored real estate in a big way in the financial crisis and I think we always looked at grocery-anchored real estate as food logistics, rather than a retail play,” Welch explained. “In the pandemic it’s really proven the local food store, or the spoke in the hub, is just as valuable as the hub itself.”
Despite an increase in online grocery shopping (to about 10 per cent in the U.S.), people are still going to the stores. Or, at least, (are) getting their products from the local stores. Again, think “food logistics.”
“That (10 per cent bought online) means 90 per cent is done in store,” Welch observed. “Now, here’s the interesting thing. Over 90 per cent – probably closer to 95 per cent – of the online sales are done at the local store.
“So what we are saying is over 99 per cent of all the sales are done at the local stores, whether it is click and collect, or someone delivers. You are not changing the distribution pattern.”
Here are a few more words and a comparison to what Amazon is and has been doing when it comes to food logistics:
“If I’m Kroger or Walmart if I have to pay $10 (per square foot) for my warehouse what’s the difference if I’m paying $10 for my store? It’s the same cost, they just look at it as a distribution cost,” he said.
However, those stores are in the middle of most neighbourhoods. Exactly where Amazon wants to be.
“I think Amazon is an amazing company. I think their acquisition of Whole Foods and others is actually to get closer to the consumer. And the Whole Foods (acquisition) was just under 400 grocery stores in a market of 35,000 stores.
“If I am Walmart with 5,000 stores or Kroger with about the same under different banners, that infrastructure is extremely valuable.”
Slate will soon own more of it.
For the full article, click here.
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New York City rolls out contactless fare payment at every single subway station
I’m late to the party here, but I was reading this morning about how New York City recently completed the rollout of its One Metro New York (OMNY) fare payment system. What this does is allow you to use contactless payment systems, like Apple Pay, to get on the subway. ONMY is now available across the five boroughs on every bus and at all 472 subway stations (feel free to impress your friends at virtual parties with this stat).
Metrolinx here in Toronto is similarly piloting contactless payments on the Union Pearson Express. You now have the option of tapping a credit card, a phone, or a watch. Maybe this doesn’t seem like such a big deal, but I still remember when the PRESTO payment card was first rolled out — it felt late to me. Apple added near-field communication (NFC) to iPhone in 2014, and at that point I think it was fairly obvious that standalone payment cards wouldn’t be around much longer.
That time has arrived for New York City and will be hopefully arriving shortly for Toronto. And I think it will be particularly useful for tourists who may not have a Metrocard (NYC) or PRESTO card (Toronto) and just want to jump on a train. I’ve only taken the subway a handful of times during this pandemic, but I’ll be back at it once the world fully resumes. And I definitely can’t wait to take the UP Express to the airport again (and to the Junction).
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London super prime and the City Trifecta Index
The latest (15th) edition of Knight Frank’s annual The Wealth Report was published last month. I find these interesting because they give you a global view of how and where capital is flowing into real estate (specifically prime real estate). London, for example, did rather well last year despite the pandemic. Buyers from the around the world spent nearly $4 billion on what is commonly referred to as “super-prime properties.” This is real estate with a sale price of US$10 million or more. London saw 201 super-prime properties trade hands last year, with an average price of $18.6 million and with 31 of these transactions being at or above $25 million. This is an increase compared to the year prior (2019), which I suppose is something given that the UK’s housing market was more or less frozen between March and May of last year. These figures put London at the top, ahead of New York and Hong Kong, when it comes to super-prime real estate sales in 2020. (London figures via the Financial Times.)
Another interesting thing that you’ll find in the report is a city ranking that Knight Frank calls their City Trifecta. What this index does is take Knight Frank’s City Wealth Index (which considers where wealth is currently concentrated) and then adds in two other dimensions: innovation and wellbeing. The idea here is that innovation should drive future economic growth and wealth, and that wellbeing (quality of life) is pretty important when it comes to the future competitiveness of our global cities. When you look at the world’s top cities through this lens, the ranking starts to differ from what you may be used to seeing with cities like London, New York, and Hong Kong at the top (see above chart). Now you have Munich taking the number one spot; Boston and Toronto in 5th and 6th position, respectively; and cities like Zurich jumping up ahead of cities like Hong Kong. These kind of rankings always need to be looked at with a critical eye, but they can be interesting nonetheless.
Image: Knight Frank
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From back of house to front of house
Daniel Foch, Daniel Clark, and Adam Darvay recently stopped by Mackay Laneway House to film a last-minute video tour before the new tenants move in. They had quite the rig setup (see above). There was also a drone flying around that is not pictured here. The full house tour should be available in about two weeks and I’ll be sure to share here on the blog.
One of the things we talked about during the tour was the future of laneway housing in Toronto. Will we see strong adoption going forward and, if yes, what does that mean for Toronto’s laneways? I think we will continue to see a steady increase in the number of laneway suites that get built in Toronto each year. And so eventually this form of living will become a ubiquitous part of the urban landscape. It’s happening fast.
Now consider what this could mean for Toronto’s laneways. As garages and parking spaces get slowly replaced by new housing, it will mean that our laneways could at some point flip from being vehicle first to pedestrian first. Mackay Laneway House does not have any vehicular parking. The front door is off the laneway. You enter on foot. That’s how you experience the lane. And Gabriel and I thought it should be celebrated.
If or when this tipping point occurs, it will trigger a perception change. Slowly but surely we will start to think of our lanes not as back of house, but as front of house. And when that happens, it’ll almost certainly force us to rethink how we design them. Forget utilitarian. Our laneways have the potential to become some of the most pedestrian-friendly streets in the city, especially with a few streetscape and landscape improvements.
Pushing this idea even further, could you imagine a world where our laneways not only become more front of house, but where the laneway side becomes the more desirable side of the property? If we gave people the option, how many would prefer to build their main house on what is today considered to be the backside? (Remember how things once flipped in Paris?)
But for the fact that we have an entrenched built form that could make this “inversion” challenging, I think there are people who would prefer to have their front door on the quieter and more pedestrian-friendly side of their property. Either way, I continue to believe that we are in the early stages of an ADU/laneway housing revolution. And things are just getting started.
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Toronto condos on the rise again
CIBC Deputy Chief Economist Benjamin Tal was recently interviewed by Larysa Harapyn of the Financial Post about the state of the housing market in the Greater Toronto Area. The message he delivers is pretty clear: “If you think that Toronto is unaffordable now, you wait.” The long-term fundamentals in this market remain strong. Demand is outstripping supply and will likely continue to do so, which is why Tal also stresses the importance of delivering more purpose-built rental housing. If you can’t see the video above, click here. (And with that, I think it’s time to switch topics for tomorrow’s post. That’s enough Toronto housing for one week.)
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Penthouse at 388 Richmond Street West sells for $2.4 million
My friend Christopher Bibby — who is a real estate agent here in Toronto — is in the Globe and Mail today talking about how Toronto-area buyers have returned to downtown. The article is by Carolyn Ireland and in it Bibby cites two of his recent deals: A large 2 bedroom suite at 168 King Street East that just sold for $1.2 million and an even larger penthouse at 388 Richmond Street West that just sold for $2.4 million.
(Sidebar: 388 Richmond Street West is one of my all-time favorite buildings in the city and was developed by Howard Cohen nearly two decades ago. For more on Howard, check out this post I wrote back in 2016.)
These are two examples of buyers who want to live in the city. Of course, there are countless others who are making moves right now. As Bibby points out in the article, the mood has certainly shifted from what we were seeing last year in the condo space. Condo buyers today are even starting to comb through expired listings in the hopes of finding off-market deals.
I view this kind of real estate activity as a leading indicator for what’s to come in the the city. Rental activity is naturally going to lag until people starting returning to offices en masse and downtown life fully resumes. It’s more of a short-term “buying” decision. But as a condo purchaser, it’s easy (and probably better) to look through the short term.
I think that’s what people are doing right now and they’re saying to themselves, “yeah, I want to be in the city.” I know that’s how I feel.
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The new Miami
The last year has been challenging for the hospitality industry. But at the same time, it was a good year to renovate. The W South Beach recently unveiled a $30 million renovation project that includes all 357 rooms. Designed by local studio Urban Robot Associates, the project directive was an interesting one. The team was asked to reimagine the hotel for the “new Miami.” A Miami that is more grown up and cultured, but that, of course, still has a bit of an edge. With all of the attention that Miami and Florida are getting right now, this project feels timely and indicative of something broader underway. Indeed, it’s hard not to acknowledge that Miami is having a moment right now. This also happens to be one of the last hotels that I stayed at prior to last March’s lockdown. So I have a clear “before” in my mind. It’s fun to see how much it has changed over the last year while I was mostly sitting at home. (Shameless plug: I also love the pale wood herringbone floors, which, coincidentally, will also be on offer at One Delisle.)
Images: Urban Robot Associates
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Net domestic migration is still pretty suburban
For years, the data has been clear. Many Americans are moving from expensive cities, like Los Angeles, to less expensive metropolitan areas like Dallas-Fort Worth.
But Wendell Cox’s recent article over at New Geography is a good reminder that these data sets can be limited. The US Census Bureau currently tracks domestic migration at the county level only. This can be a bit of a problem as counties vary dramatically in terms of geography and population.
The New York metropolitan area, for example, is comprised of 25 different counties averaging about 750,000 residents. The Los Angeles metropolitan area, on the other hand, is compromised of two counties averaging about 6.6 million residents.
These sorts of nuances become important when you’re trying to figure out things like whether people are moving to/from urban cores or the suburbs. Case in point: The San Diego metro area is compromised of a single county. When people move there, the data says nothing about how urban or suburban they might be.
Dallas-Fort Worth is a lot easier to read. Since 2010, it has had the largest net domestic migration of any metro area in the US: +443,000 residents. But county data reveals that it is entirely suburban. The core (Dallas County) actually lost 57,000 people from 2010 to 2019. And this is not unique to the Dallas-Fort Worth area.
Photo by Gabriel Tovar on Unsplash
