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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  • My new gig…

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    So this is interesting.

    Earlier this month, Travis Kalanick – co-founder of Uber and its former CEO – formed a new venture fund called 10100. According to the WSJ, it was funded with his own money after he sold 30% of his position in Uber for a cool $1.4 billion. 

    Ten-one-hundred’s spartan website explains that the goal of the fund is “large-scale job creation, with investments in real estate, ecommerce, and emerging innovation in China and India.” On the non-profit side, the initial focus will be on “education and the future of cities.”

    Then this week, Travis tweeted out “My new gig…” and disclosed that 10100 had entered into an agreement to buy a controlling interest in a real estate holding company called City Storage Systems (CSS) for $150 million. 

    He also announced that he would become CEO.

    The focus of CSS is on the redevelopment of distressed real estate, particularly parking, retail, and industrial assets. He goes on to say: “There are over $10 trillion in these real estate assets that will need to be repurposed for the digital era in the coming years.”

    This whole series of events is a big bet on some significant changes in the real estate space.

    Photo by Martin Reisch on Unsplash

  • What are the most important condo and rental building amenities?

    Last night I casually asked the

    Twittersphere

    what the most important condo amenity is, besides a gym. 

    That tweet got quite a few responses – everything from rock climbing to a proper facility for realtor lock boxes.

    Given the response, I thought it would be worthwhile to be a bit more rigorous in this analysis. So I have created an online survey that you can very quickly fill out by clicking here. 

    Here’s how this is going to work:

    – You have to enter your email address. Sorry, some friction. I figured that would make the data a bit more reliable. Don’t worry your email is safe.

    – You can select a maximum of 3 amenities. One of them can be “Other”, in which case you would then enter in an amenity not already found on the list.

    – The order of the amenities in the survey is being randomized so as to avoid any possible it’s-near-the-top-and-I’m-too-lazy-to-scroll bias.

    – You’ll be able to see the results of the survey after you’ve responded. I’ll also post the results to this blog so that it’s public and people learn things. Individual emails will, of course, never be published.

    Developers should be building what people actually want and will use. Now is your chance to tell us what that is. Click here for the survey.

  • It Will Never Work

    On March 31, RIBA North (Royal Institute of British Architects North) in Liverpool will be opening the doors on a new exhibition that explores 25 years of award winning work by the developer and self-described “regenerator”, Urban Splash. I love the name of the exhibition. It’s called: “It Will Never Work.”

    Here is a short description of the exhibition:

    Urban Splash profess to have started without a plan, purposefully ignoring advice and routinely rejecting accepted development processes. At every step ‘it will never work’ has been a call to action rather than a discouragement.

    The company’s maverick presence on the development landscape of the North has changed the way we live, work and play in our cities, and their continued success as ‘established innovators’ is helping to shape urban futures.

    If you aren’t familiar with the work of Urban Splash, I would encourage you to check them out. When I was first starting out in development and scouring the world for developers that actually cared about design and cities, these guys were on my shortlist.

    So I have been a longtime follower and I have developer friends here in Toronto who I know also admire their work. Sadly, I have no plans to be in Liverpool anytime soon. But maybe some of you do.

  • Crypto networks and top-down urban planning

    Taylor Pearson recently compared crypto networks to cities and argued that the best crypto networks, much like the best cities, are formed from the bottom up. 

    The example he gives is that of Paris (bottom-up) vs. Brasilia (top-down). Paris is the hugely successful city and Brasilia is the failure of high-modernism.

    I appreciate the argument he’s making and I do agree with him on the potential of decentralization, but I couldn’t help but dig into his city example a bit further.

    The Paris we all know and love today is the result of an enormous centrally planned urban renewal exercise. Baron Haussmann carved, among many other things, long straight boulevards through Paris’ medieval fabric in order to modernize and rationalize the city.

    What makes this top-down exercise different from that of Brasilia’s? Is it simply that Haussmann was constrained by Paris’ existing and decidedly urban fabric?

    Because then we could turn our attention to New York City’s gridiron plan of 1811, which laid out – before the island of Manhattan had even fully developed – a relentless and orthogonal street network from Houston Street all the way up to 155th Street.

    Is the difference that Brasilia was planned with suburban sensibilities in mind and Manhattan was not? Or was it the restrictive Euclidean zoning that did it in for Brasilia? 

    Whatever the case may be, history suggests that some top-down planning exercises may have worked out just fine. Though to be fair, each of them was not without their share of critics.

    Photo by Rafael Leão on Unsplash

  • Neighborhood depopulation

    Recently we’ve been talking about California’s Proposition 13 and how it may be creating a disincentive for longtime homeowners to move. They’re enjoying below market property taxes, and so they stay put, even if they may have too much house.

    But this concept of “overhousing” isn’t unique to California. The Globe and Mail just ran a piece talking about how Toronto’s designated “Neighborhoods” are losing people as the nests empty out, seniors remain put, and the broader city booms.

    The rate of depopulation that created the spare bedrooms in Toronto’s low-rise neighbourhoods is stark: “Since 2001, about 52 per cent of the land mass of Toronto has reduced in density of population by about 201,000 people,” Mr. Smetanin says. “Other parts of Toronto have grown by 492,000.”

    The irony of this phenomenon is that the city’s Official Plan considers these Neighborhoods to be “physically stable”, as well as “one of the keys to Toronto’s success.” However, things are clearly changing behind that physical stability.

    Photo by Verne Ho on Unsplash

  • UNStudio announces new tech architecture company (and thoughts on the smart home)

    Dutch architecture firm UNStudio has just launched a new company called UNSense, whose purpose is to explore and develop “new sensor-based technologies that are specifically designed to positively impact people’s physical, mental and social health.” They are calling the new business an “arch tech company” and it is their belief that, at some point, all architecture firms will become arch tech companies. You can learn more about UNSense, here.

    This announcement got me thinking about the state of smart home technologies, which, of course, is this massive buzzword that everyone is throwing around these days. Many of us have smart thermostats, voice assistants (that may be listening to our every word), wifi lights, and so on. And you can do some pretty neat things with software like IFTT, such as program your lights to come on at sunset or when you walk in the door.

    But as cool as they may be, these smart home devices have always felt like patchwork add-ons to me. I understand that this is partially driven by what customers can easily adopt and I don’t mean to discredit the value that they bring, but today’s post is about reminding us to also think more fundamentally, as opposed to just incrementally.

    Smart thermostats, for instance, give us the functionality to adjust our heating/cooling from our phone. But at the end of the day, they still control the same underlying system, which, by the way, is a fairly simple one. When it gets cold (because of our R-3 windows), the heat turns on. When it gets warm enough, the heat turns off. Zoned systems certainly add another layer of sophistication, but are we optimizing for the right variables?

    UNSense works at three scales: Cities, Buildings, and Interiors. And if you look at what they are trying to do at the building scale, it is around the interface between inside and out. Designing transformable facade systems and buildings that can respond to their environment and our changing needs. These are not new ideas, but in today’s tech-driven world, the timing may just be right.

    If you think about the climate we have here in Toronto, it is actually an incredibly difficult design problem. We have cold winters and hot humid summers, which means we have to solve for two different extremes. Mechanical systems have made that a lot easier to do, but if we’re going to meet the energy and greenhouse gas emission targets that we’re all talking about, we’re going to need a hell of a lot more than just smart thermostats.

    Image: UNSense

  • Would it be insider trading if Kylie Jenner traded on her tweets?

    Lately I have really gotten into Matt Levine’s daily newsletter about “Wall Street, finance, companies and other stuff.” Maybe that’s how I should describe this blog: Cities, real estate, design, and other stuff.

    If you aren’t familiar with Matt’s writing, here is an article that he wrote about Kylie Jenner’s recent tweet concerning Snapchat. You know, the one that wiped out $1.3 billion of market value because she revealed – using only 88 characters, I might add – that she was no longer using the app.

    https://platform.twitter.com/widgets.js

    The article was spurred on by this question:

    “Would it be insider trading for Kylie Jenner to buy short term out of money put options on Snap and tweet out that she’s no longer using Snap?”

    And this is the start of his answer:

    Insider trading, as I am constantly saying around here, is not about fairness; it is about theft. It is not illegal to trade on your own nonpublic knowledge of your own intentions. Warren Buffett can buy stocks before he announces that he’s bought them, even though that announcement will predictably make the stocks go up. 

    If I did describe this daily blog like Matt describes his daily newsletter, this post would clearly fall into the “other stuff” camp. But maybe you too will find it interesting. If you do, you can subscribe here. 

  • Thoughts on housing in the Bay Area

    I was out for drinks recently with a friend of mine who is a developer in California and she mentioned a few things to me that I thought were really interesting. 

    First, she talked about how virtually nothing gets built in the Bay Area “as of right.” And so the market is hugely supply constrained. She said, you’re lucky if you can get your entitlements in 2 years. It’s starting to take longer. I immediately said: “That’s Toronto.”

    Second, we talked about Proposition 13, which was timely given this recent post. One of the consequences of Prop 13, beyond helping golf clubs survive, is that longtime homeowners seem to be highly incentivized not to move. 

    Their property taxes are so below market that it can be more cost effective for them to stay put as opposed to downsize – even if they have too much house. This means far less turnover in the housing market.

    Third, there really does seem to be a feeling in the Bay Area that it’s at a breaking point in terms of affordability. When a successful software engineer making $200,000 a year can’t afford housing, people naturally start to look to other cities.

    We hear this refrain all the time in the media, but because I’m not active in that market, it was far more impactful hearing it from a friend.

  • The City as a Place for People

    The City of London Corporation recently published a report called “The City as a Place for People”, which talks primarily about itself and how great London is as a magnet for talent. 

    But as self-serving as it may be – the report is timed to be ahead of this year’s MIPIM – there appears to be some data and interviews backing up the claims.

    58% of “institutional investors” said that London is the best European city for business. Dublin was next at 22%. 

    A separate survey of 2,568 “corporate decision makers” in Europe revealed that 21% of respondents felt that London was the best European city for business, followed by Paris (13%) and Frankfurt (7%). When asked which city had the best talent pool, the responses were fairly similar.

    Also included in the report is a rendering of the City’s skyline by 2026. These are always fun to see. Here is a screen grab:

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    It is showing all towers under construction and all towers with their planning permissions in place. If you’d like to download the full report, you can do that here.

  • The density delusion

    Joel Kotkin and Wendell Cox recently published a piece in the Orange County Register called, “California’s housing crisis and the density delusion.” I’m sure you can guess where this is going, even if you don’t follow the work of Joel Kotkin. But if you do, you will know that he is an ardent supporter of suburbia and the single-family home.

    Here is an excerpt from the article:

    In reality, the YIMBY’s suggestion that new, dense housing will improve affordability for all is patently absurd. Decades of densification in Los Angeles has seen ever higher rents, displacing low-income, especially minority households. Many former transit customers have been driven to lower-rent areas with less transit service, precipitating a massive decline in ridership, even as billions continue to be spent building new rail lines. The Wiener Bill [my link, not theirs] could exacerbate this trend, and likely increase the need for low-income housing, already well beyond the capability of public coffers.

    I fully appreciate the argument that high-density housing isn’t for everyone and that we shouldn’t be “forcing everyone back to the ‘glory’ days of the city of tenements.” But I disagree with many of their points, including the argument that density doesn’t encourage transit ridership. Density isn’t everything, but it’s an important something.

    The article is definitely worth a read, particularly if you disagree with their positions. That’s how you avoid confirmation bias. I was trying to keep that in mind as I read it. Maybe it worked.