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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  • Social and physical segregation in Singapore

    A recent study by the MIT Senseable City Lab has used cellphone data to map both social and physical segregation within Singapore. To start, they used residential sale prices as a proxy for socioeconomic status. They then used call and text records (presumably it was all anonymous) from 1.8 million cellphone users in Singapore (2011) to map who interacted with who. Pictured above is one of those mappings.

    What they discovered was evidence of a “rich club effect.” In other words, the richer the person the less likely they were to interact with people outside of their socioeconomic band. The study calls this their communication segregation index.

    A similar phenomenon was noted as people moved around Singapore. (This is the study’s physical segregation index.) People tend to spend time in spaces alongside people with similar socioeconomic attributes. However, they did notice that this tends to wane during the day as people move around the city — presumably for work and other such things.

    I think it would be interesting to get a bit more granular about the findings in order to try and see, among other things, if certain public spaces are more successful than others at encouraging a broader socioeconomic mix. And it’s probably only a matter of time before we start using tools like this to plan our cities. For more on the study, click here.

    Image: MIT Senseable City Lab

  • Making cities resilient to climate change

    This past fall, Goldman Sachs published an important report about “making cities resilient to climate change.” In it, they remind us that the scientific consensus is that the world has already warmed from the pre-industrial era (and will likely continue to do so) and that a great many of us live near water (and will likely be impacted going forward).

    About 40% of the world’s population lives within 100 kilometers of a coast, and about 10% of the world’s population lives in a coastal settlement that is less than 10m above sea level. Above is a list of some of those cities, along with their average elevation in meters. The cities with single digit elevations include Bangkok, Miami, Alexandria, and Amsterdam.

    Goldman’s prediction is that this need for “urban adaption” could lead to one of the largest infrastructure build-outs in history. And that cities all around the world should already be thinking about how they will finance and equitably execute on greater resilience (assuming they aren’t already).

    Click here to download a full copy of the report. The diagrams showing the average change in global mean surface temperatures against the pre-industrial period are something you should all look at it. The 2015-2019 change is pictured above.

    Charts: Goldman Sachs

  • Brutalism is fashionable again, kind of

    I think it’s time to make it official: Brutalism is fashionable again. Okay, kind of. According to this WSJ article, the appreciation for this style of architecture remains nowhere near universal, but the renaissance is certainly continuing. Some Brutalist structures are and have been torn down; while others are being repurposed.

    One recent example is the Balfron Tower in East London (pictured above). Designed by the Hungarian-born architect Ernő Goldfinger and completed in the 1960s as social housing, the tower is currently undergoing a £40 million renovation that will convert it to market-rate housing. Apartments start at £365,000 (USD 472,054) for a 450 square foot one bedroom.

    One notable feature are the “streets in the sky” that separate the building’s circulation (elevator core) from the actual suites. It’s a peculiar way to build and most never consider it today, but it’s very much a hallmark of the Brutalist movement. The idea was to express the building’s various functions — vertical circulation being one of them.

    I guess we just don’t build them like we used to.

    Photo: Walter Homann via the WSJ

  • Merry Christmas, everyone

    The frenetic run-up to Christmas has come to an end, and I’m looking forward to relaxing and taking it easy with family and friends. I hope that all of you are able to do the same, however you spend the holidays. This is the one time of the year when the email firehose completely shuts off and it’s a lot easier to do exactly that. I think that’s important for all of us.

    This past year I found it particularly difficult to disconnect. And 2020 is on deck to be an even bigger year. But I wouldn’t have it any other way. I am, however, going to take this time to slow down, read, write, travel, and likely drink a bunch of wine. As always, you’ll find me here on the blog every morning. Merry Christmas, everyone.

    P.S. The Toronto Raptors are hosting their first ever Christmas Day game.

  • Trade patterns in global cuisine

    In 2017, the US restaurant industry generated about $560 billion in annual revenue. By comparison, the movie industry generates some $30 billion a year. Food, and eating out, is a big business.

    A recent paper by Joel Waldgogel of the University of Minnesota has tried to estimate the “implicit cuisine trade” associated with this industry. To do this, he used restaurant data from TripAdvisor and sales figures from Euromonitor.

    Domestic consumption of a foreign cuisine was considered an “import.” And foreign consumption of a domestic cuisine was considered an “export.” Here’s what he discovered (graph from the Economist):

    Italy is, by far, the biggest net “exporter.” And the US is the biggest net “importer.” If you exclude fast food, the US “deficit” balloons to approximately $140 billion.

    I guess everybody does really love Italian food. For the full paper, click here.

  • SHARE NOW exits North America (and a few European cities)

    Last week, SHARE NOW — which was previously known as Car2Go — announced that it will be exiting the North American market entirely come February 29, 2020, and that it will also cease operations in London, Brussels, and Florence. A couple of reasons were cited, including the “volatile state of the global mobility landscape,” but that really translates into low adoption:

    Further, despite our best efforts and investments in Brussels, London and Florence over the years, we are unable to continue operations in a manner that’s sustainable for our business due to low adoption rates.

    Moving forward, SHARE NOW will focus on the remaining 18 European cities. We, along with our shareholders, believe these markets show the clearest potential for profitable growth and mobility innovation.

    There was a period of time when I used to use Car2Go here in Toronto. My network did as well. But that quickly stopped with the rise of Uber and Lyft. I mean, why bother finding a Car2Go and then parking it, when there’s a much lower friction option? I would imagine that’s how most people feel. (Maybe there’s a care share advantage for longer trips.)

    At the same time, companies such as Uber and Lyft have, as you know, not performed well as public companies. The market is nervous about their path to profitability. In my view, they’re largely an undifferentiated offering right now, and it’s pretty easy to switch across them. So yeah, I guess the global mobility landscape is pretty volatile.

  • A non-zero probability of copycats

    Software businesses are generally high margin businesses. But along with this feature comes some risks. Here’s an excerpt from a recent post by Scott Galloway (which is actually about FedEx):

    With any software start-up, there is a non-zero probability that you wake up the next day and find that a better-resourced firm (Microsoft, Oracle, Salesforce, Adobe) has deployed 200 engineers to copy your product, bundle it with their stack for free, or near free, and … welcome to zero. I believe this is happening to Slack, but more slowly than Netscape, as Microsoft’s General Counsel has likely coached Satya to charge a nominal fee for Teams and let Slack bleed out, instead of putting a bullet in its head and stirring the DOJ from a 3-Ambien slumber.

    Real estate, by comparison, doesn’t get disrupted in quite the same way. A location/city can lose its economic purpose (Great Grimsby is just one example), but as long as there are growth tailwinds the real estate should do well.

    Venture capitalist Fred Wilson has on many occasions written about how he (and his firm) made a fortune in the dot-com era, only to lose it all and have to remake it again over the subsequent decades.

    One the lessons learned from that experience (according to his blog), was to take some of that second tech fortune and invest it into hard assets — namely real estate. That feels right to me.

  • The power brokers

    The Nib’s recent comic about Jane Jacobs vs. The Power Brokers (i.e. Robert Moses) is a good little overview of her lessons and legacy. But I don’t understand the claim that developers co-opted her ideals in order to exploit and gentrify urban neighborhoods. According to the comic, gentrification is always a top-down affair by developers, and never a spontaneous emergence as a result of other humans and/or industry wanting to be in a particular place.

    I can think of many neighborhoods that have seen investment from groups other than traditional developers, including from individual homeowners. Take, for example, Cabbagetown in Toronto. There was never a top-down developer moment. It was individuals who saw beauty (and also opportunity) at a time when others were scared of the area. Is that acceptable? Perhaps more importantly, did these people wear black suits?

    The other missing piece is the fact that desirable urban neighborhoods are, today, in incredibly short supply. During the reign of Robert Moses, Jane Jacobs had a view of cities that was in opposition to the planning zeitgeist of the time. But over time, she went from controversial to enlightened, and alongside this we saw a return to cities.

    Combined with strict land use policies, this rising demand for Jacobian-style neighborhoods has meant that many/most dense urban centers operate with a perpetual housing supply deficit. There’s not enough cool urban housing to go around. Add in the current low interest rate environment, and you then have even more money searching for that perfect home in the West Village. That tends to do things to prices.

    Image: The Nib

  • Project connected home

    This week it was announced that Amazon, Apple, Google, and the Zigbee Alliance are joining forces to develop a new royalty-free connectivity standard for smart home products. The working group is called Project Connected Home over IP and the goal is to develop a “USB-like plug-and-play protocol for the home.” If successful, this standard would get applied to all smart home systems, including the Amazon, Apple, Google, and other “assistants” that you may already have in your home.

    The thing about smart home devices is that most of them are exactly that: a device. They’re something you buy and append to your home, as opposed to something that gets built into the core of your home. This, of course, makes sense, given how difficult it is to innovate within the real estate space. If you’re in the business of creating smart home products, you ideally want everyone to be able to buy it and quickly add it to what they already have. And as a consumer, you don’t want your permanent fixtures to become quickly outdated.

    But if/when a standard emerges, I wonder if that doesn’t make it easier to develop a more holistic approach to smart home products. That could be really interesting. If you’d like to learn more about the project, click here.

  • A story about architecture, interiors, and branding

    I was recently having a debate with one of our architecture partners about the interrelationship between architecture, interiors, and branding. This came up because, in New York City, you almost need a name brand architect attached to your project in order to sell luxury condos.

    But this raises an interesting set of questions: How much value is driven by the quality of the architecture versus the architect’s brand? (Though, presumably you need the former in order to build the latter.) And how much of the value is actually just driven by the finishes (interiors) and the branding that you layer on after?

    This latter scenario is a depressing thought for architects. It is architecture as a kind of “empty vessel.” One that just gets dressed up for today’s Instagrammable moments. And I am sure that you can think of some examples of this. Not everything can be capital A architecture.

    But what is clear is that the most successful design-driven projects don’t think in this way. They are thoughtful and deliberate about each component, and they all work together to strengthen each other. Marketing, after all, is about telling the right story. It is always helpful when you actually have one to tell.