Tag: athiscity

• Will parking spaces in cities become more, or less, valuable in the future?

  

  https://500px.com/embed.js

  Lately I’ve been having discussions around the future value of parking spaces in urban centers. So yesterday I tweeted out this poll:

  Will parking spaces in cities become more, or less, valuable in the future? 💸 #AThisCity

  — Brandon G. Donnelly (@donnelly_b)

  November 4, 2015

  //platform.twitter.com/widgets.js

  The sample size is very small, but for what it’s worth, there are some/many people who believe that urban parking spaces will become more valuable in the future.

  This is a reasonable assumption. 

  Over the last couple of decades here in Toronto, I would guess that parking ratios for new multi-family developments have probably fallen by more than half. It used to be that you had to build 1 to 1.5 parking stalls for each unit and now we seem to be sitting somewhere close to 0.5. Although, there are also exceptions and some projects today are getting built with no parking.

  So given that the supply side of urban parking spaces seems to be getting constrained and many cities are actively trying to encourage other forms of mobility, it’s not unreasonable to believe that parking stalls will only become more valuable. That’s why a new underground spot in Toronto might cost you $60,000 today and why some spots in New York can even fetch a $1 million. 

  But this assumes that the demand for parking will remain more or less the same. What if it doesn’t stay the same? What if we were to experience a tipping point that rearranged urban mobility? What if the cost of driving became so high that people stopped driving at scale? In these scenarios, the demand side of the equation would change.

  If you’re a regular of this blog, you probably know what I’m going to say next. But already I can think of two innovations that would contribute to the above scenarios: Uber and driverless cars.

  Uber’s goal is to continually drive down the cost of transportation and eventually get you to no longer own a car. They know very clearly that the demand for transportation services is highly elastic and that the cheaper they get the more you will use them. And the way they get cheaper is by continually increasing the utilization rate of their drivers/cars. An idle driver/car is the enemy.

  Of course, the other way to drive down fares is to remove the driver all together. And once you’ve done that, there is, in theory, no reason that a car should ever sit idle – like they do today. (The utilization rate for my car is around 2%.) And if a car is never sitting idle, then why would you ever need to park it? Certainly you wouldn’t need to park it as often as you do today.

  All of this isn’t going to happen tomorrow, but I believe – despite the supply constraints – that we are going to end up with excess parking spaces in our cities. And that will mean that they are going to be perceived as less valuable than they are today. I also believe that it will eventually seem silly to drive your own car. 

  What do you think?

  2015.11.05

• Throwing butts

  For whatever reason, some of the people living in high-rise buildings believe that if you flick a cigarette butt off a balcony that it will magically disintegrate on the way down. It’s either that or they don’t give a shit about anyone else.

  Because if you happen to live in or manage a building which has patios or terraces at the base of tower, I bet you have this problem:

  

  Above is a picture of a Belmont cigarette burning through the tarp covering the wooden harvest table on my patio. 

  It’s a destruction of property, an environmental concern (many butts end up in stormwater drains), and a pretty scary fire hazard. I know of many incidences where thrown cigarette butts have started fires in a high-rise building. It happened last year in my mother’s building.

  However, the frustrating thing about this problem is that it’s exceptionally difficult to stop. I know this because I sit on the board of my condo building. The typical response is for management to send out notices to all the residents asking them to stop doing this. But frankly, that does nothing.

  So if any of you know of a company or service (or have a product idea) that can help with this, please contact me. But if no such company or service exists, I am positive that you could create it today and sell to almost every condo corporation and property management company that have a condition where terraces or patios sit below a tower. Because inevitably, there will be someone upstairs throwing butts.

  Many buildings have a similar issue with dog poo. People simply don’t pick up after their dogs. So some property managers have started taking stool samples of every dog who lives in the building. That way they can easily determine which residents aren’t picking up after their dogs. I guess that’s what it takes to get some people to give a shit.

  Of course, this isn’t a problem just in buildings. Cities in general are always fighting litter. That’s why you see ideas like this pop-up:

  #neatstreets, idea geniale per ridurre i mozziconi sulle strade pic.twitter.com/udbV7IH9AW

  — Else Project (@ElseProject_)

  October 14, 2015

  //platform.twitter.com/widgets.js

  This particular one (in London) was designed to stop people from throwing their cigarette butts on the street. Instead, you use your butt to vote. In this case: England vs. Australia.

  We talk a lot about big ideas here on Architect This City. What driverless cars will mean for cities, how laneway housing could help with housing affordability, and so on. But the smallest ideas can also matter a lot for city building. Sometimes we forget that.

  2015.11.04

• The impact of Chinese buyers on Vancouver’s single family home market

  I have a new favorite blog that I think you might all enjoy as well. It’s called BT | A | Works and it is the “architectural and urban research and development division” of Bing Thom Architects in Vancouver. 

  I think it’s it’s important to have people in a firm who are researching and experimenting with ideas beyond the day-to-day tasks of a job. So I was excited to discover their work this morning.

  Their most recent post is a look at ownership patterns of single family homes sold in 3 west end neighborhoods in Vancouver from September 2014 to February 2015 (a 6 month period). These are some of the most expensive areas in the city and, collectively, they found 172 properties sold with an aggregate value of around $520 million.

  

  Given the presence of foreign buyers in Vancouver’s real estate market, one of the things they then did was identify “non-anglicized Chinese names” on the title records. This means names like “Li Xian”, but not names like “Andrew Shui-Him Yan”, because the anglicized first name suggests that they are probably not a new immigrant or probably not living abroad.

  Here’s what they found:

  

  In total, 66% of the properties in the sample (172 properties) were associated with a non-anglicized Chinese name. And for properties over $5 million, the percentage jumps to 88%. The other interesting thing worth noting is that 23% of the registered owners declared their occupation as “homemaker/housewife.”

  I thought this would serve as an interesting follow-up to the post I wrote about a month ago called, Is Hongcouver better off than Vancouver? If you’d like to see the full BT | A | Works presentation, click here.

  2015.11.03

• Los Angeles seeks Creative Catalyst

  

  https://500px.com/embed.js

  We all know that city building is a multi-disciplinary endeavour. That’s why I was incredibly interested to learn about a new “Artist-in-Residence” program that Los Angeles is launching:

  The Honorable Mayor Eric Garcetti, is pleased to announce the first collaboration between two City of Los Angeles departments to place an artist in residence in a department to serve as a Creative Catalyst who will develop creative intervention strategies to achieve department specific goals. The Creative Catalyst Artist in Residence Program will serve as a model to stimulate creative thinking and innovative projects, while supporting Mayor Eric Garcetti’s Back to Basics priority outcomes: to make our city livable / sustainable, prosperous, safe, and well-run.

  Cities are complex organisms. And some of you might be wondering how artists can help city build. But this is about bringing different minds together, thinking across disciplines and, hopefully, leveraging design thinking to solve urban problems. And LA is not the only city to try this approach.

  In my view, it’s not that dissimilar from the trend around “Designer-in-Residence” programs at venture capital firms and startup incubators. Cities, businesses, and many other organizations are recognizing that the way artists and designers think can be of tremendous value.

  So if you’re an artist who lives and/or works in LA, this might be something worth considering. You have until this Friday, November 6th, 2015 to apply.

  2015.11.02

• Living minimally

  

  “The wisdom of life consists in the elimination of non-essentials.”
  – Lin Yutang
  

  Yesterday I posted the above photo on social media with the caption: 

  “This year I decided to go ALL OUT for Halloween.” 

  A friend then responded and said: 

  “A minimalist does Halloween. Love it.”

  I’ve been called a minimalist many times before. And it is certainly something that I think about. Oftentimes I feel like life is a constant battle against physical and mental clutter. But that the more you can rid yourself of that clutter, the happier and freer you will feel.

  It’s why I scan most of my paperwork into Evernote and then throw out the hard copies. It’s why I tend to wear a lot of white dress shirts and black t-shirts – it keeps life simple and reduces decision making. And it’s one of the reasons I’m so attracted to laneway houses and small spaces. I don’t think most of us need as much home as we think we do.

  If this is something that also interests you, I recommend checking out a blog called The Minimalists. I just recently subscribed to them.

  2015.11.01

• How we perceive commuting

  

  https://500px.com/embed.js

  Wharton real estate professor, Mariaflavia Harari, recently published a paper that looks at the relationship between urban geometry (specifically compactness) and inner city commuting efficiency across 450 cities in India.

  Consistent with previous research done in this space, she finds that people generally prefer compact cities and that they are willing to pay a premium for it. It increases overall welfare. Here’s an excerpt from her paper:

  “My findings are broadly consistent with compact city shape being a consumption
  amenity. All else being equal, more compact cities grow faster. There is also evidence that
  consumers are paying a premium for living in more compact cities, in terms of lower wages and,
  possibly, higher housing rents.”

  So her recommendations for the Indian cities she analyzed was that they should relax land use restrictions to allow for more vertical / compact development and that they should focus on improving urban transport in order to offset some of the negatives externalities associated with sprawl. This is no different than the approach that many cities in the developing world are adopting or looking to adopt.

  One of things that really stood out for me in her paper though is the way people perceive commuting:

  “The loss associated with non-compact
  shape appears to be substantial: a one-standard deviation deterioration in city shape, corresponding
  to a 720 meter increase in the average within-city round-trip, entails a welfare loss
  equivalent to a 5% decrease in income. This is considerably larger than the direct monetary and
  opportunity cost associated to lengthier commutes. Less compact cities also appear to attract
  fewer low-income immigrants, as captured by the share of slum dwellers.”

  What this is saying is that we tend to overvalue the negatives of commuting, beyond the direct costs of gas, insurance, car payments, our time, and so on. We hate it so much that we also want to be compensated for the mental anguish. Here is that same idea said differently:

  The estimated welfare loss from longer commutes appears to be large, relative to the immediate
  time and monetary costs of commuting. This is consistent with the interpretation that
  commuting is perceived as a particularly burdensome activity. The behavioral literature has
  come to similar conclusions, albeit in the context of developed countries. Stutzer and Frey
  (2008) find a large and robust negative relation between commuting time and subjective wellbeing,
  using German data. They estimate that individuals commuting 23 minutes one way
  would have to earn 19 percent more per month, on average, in order to be fully compensated.

  So I guess I’m not the only one who thinks commuting and driving sucks.

  2015.10.31

• City-to-country colonization

  

  Lately I’ve been feeling that we’ve been having some pretty serious conversations here on Architect This City. Everything from condominium reserve funds to housing/tax policy. So today I thought we could change it up and talk about something a bit more fun: farmhouses.

  Last weekend when I was in Prince Edward County, one of the places that I visited was the Drake Devonshire Inn. It’s been on my list for awhile, so I’m glad I finally got to experience it. It’s an outpost of the Toronto-based Drake Hotel (no relationship to Hotline Bling Drake) and they refer to it as their “contemporary farmhouse.” 

  It was stunning.

  As soon as I walked on the grounds, I couldn’t stop looking around, taking pictures, and examining all the art that they have sprinkled around the inn. Those are the sorts of things I do when I get excited by a building or place. I’m like a kid in a candy store.

  I was so impressed that after I left I had to message my friend – who worked on the project and who I went to architecture school with – to tell her that she did an amazing job. Want to see for yourself? Click here for photos of the farmhouse. And click here for information on the design firm behind the farmhouse (+tongtong).

  But beyond just a great space, the Drake Devonshire is also symbolic of something greater than seems to be taking place. Almost everybody I met in PEC seemed to be a Toronto transplant. They were done with life in the city and decided take off for the country. But along with them is coming pieces of the city. (The Hayloft Dancehall is another example.)

  I used to think that this kind of city-to-country colonization was bound to happen in Niagara-on-the-Lake, which is only about an hour west of the city. But it turns out I was wrong. It seems to be happening to the east of the city in Prince Edward County.

  2015.10.31

• Should condo reserve fund balances be made publicly available?

  

  https://500px.com/embed.js

  I’ve been thinking a lot lately about condominium governance and how things might be improved.

  If you own a condominium, you pay a monthly maintenance fee. Let’s say, for example, you own a 833 square foot condo and your maintenance fee is $500 per month. That works out to be $0.60 per square foot.

  For a lot of people, this fee probably feels like a bit of a black hole. The money goes out every month and that’s the end of it.

  But as I explained here, a portion of that fee goes into the condo’s reserve fund to cover future capital expenditures. This is basically an investment you are making for the future benefit of the building.

  As an example, if you’re paying $500 per month, somewhere around 25% could be going towards your condo corporation’s reserve fund. That’s $125 per month. $1,500 per year. $7,500 over a 5 year period. And $15,000 over a 10 year period.

  Now this is an investment that you’re obliged to make, but one that you might not be around to directly benefit from if you decide to sell before capital expenditures are made using the money you’ve invested.

  Of course, if you’re a savvy buyer, you’re going to scrutinize the reserve fund and the corporation’s overall financials before you buy into a building. And sometimes the unit valuations do get deeply depressed by out of control maintenance fees and/or special assessments. So you could maybe argue (as an owner) that your reserve fund investment ends up getting recaptured in an eventual sale.

  But what I wonder is to what extent a properly funded reserve gets accurately reflected in the valuation of the individual units. I suspect not that well. And as far as I know, there isn’t great data on this metric. (If you know of anything, please share it in the comments.)

  It’s certainly important information to have and consider. Again, when you buy a condo unit you’re not only buying the unit itself, you’re also buying the future investments (and liabilities) that others have left before you.

  So what I really want to know: Why aren’t reserve fund balances and building studies made publicly available? This is not easy information to get today.

  But imagine what would happen if the market had full transparency. Imagine if you could see a map of every condo building in your city and sort by age and reserve fund balance. In theory, unit pricing would become more accurate. But even more than that, there would be significant opportunities for collective intelligence.

  Now all of a sudden buildings would be able to benchmark themselves against other buildings to see if their reserve fund is sufficient, as well as learn from other buildings with respect to their history of capital expenditures. It would also hold the building’s management more accountable and allow owners to easily see if the contracts in place are competitive with the overall market.

  I know that a lot of people get nervous when it comes to sharing information like this. I mean, what would happen if your building is underfunded relative to its peers? Would that pull down property values? It certainly could. But if you’re underfunded and you get stuck with a special assessment in 5 years, then your property values are going to drop regardless.

  So I would love to see a lot more condo information made available to the public for free. In my view the benefits outweigh the potential negatives, particularly if this were to be done at scale. Condo corporations are also non-profit entities, so it’s not as if their balance sheets and income statements are filled with sensitive trade secrets.

  But what do you think? Would you feel comfortable if your condo’s reserve fund balance was made available online to the public? Do you even know off the top of your head what the balance is for your own building? I would be curious to know.

  2015.10.29

• Sam Zell’s Equity Residential sells 23,000 suburban apartment units

  Earlier this week it was announced that Sam Zell – the billionaire who initially made his money in real estate – is selling over 23,000 apartment units to Starwood Capital Group (Barry Sternlicht) for $5.4 billion. The units are all controlled by Zell’s company, Equity Residential.

  This is interesting for a number of reasons, but I’d like to point out two of them today.

  Firstly, Zell is famous for selling another one of this companies, Equity Office Properties Trust, to Blackstone for $23 billion in 2007. This was right before the market fell out and so some people are asking whether this signals the end of the apartment run. Average apartment rents in the US have increased roughly 20% over the last five years.

  But at the same time (and this is my second point), it might not be that at all. Instead, it could simply be a rebalancing of the portfolio. Here’s an excerpt from the Wall Street Journal:

  …Equity Residential has become “less aggressive as buyers of assets” in recent years, Mr. Zell said in an interview late Friday. Instead, it is getting out of suburban markets and into downtown urban centers, where young people are moving and where it is more difficult to build, he said.

  Most of the 23,300 apartment units in the deal, roughly a quarter of Equity Residential’s total, are low-rise and mid-rise units in suburban markets in and around southern Florida, Denver, Seattle, Washington, D.C., and Southern California. Analysts expect a significant amount of new supply to be concentrated in those markets in coming years.

  Of course, Sternlicht is buying these suburban properties and so he clearly has a different investment thesis. (The purchase price works out to be $230,600 per unit at a cap rate of roughly 5.5%.) But that’s what makes these deals so interesting to scrutinize. Nobody really knows what the future holds.

  2015.10.28

• Somewhereness

  

  For over 10 years I have been a big
  supporter and proponent of Ontario wines. It’s almost the only kind of wine I
  buy. When I go to a restaurant I will always look to see what wines they have
  from Ontario, because I would much rather support a local winemaker.

  This past weekend I was in Prince Edward County visiting Norman Hardie. They are one of my
  favorite wineries in Ontario and if you haven’t yet tried their wines, I would
  encourage you to give them a go. They also have a great wood pizza oven if you
  decide to visit them in person.

  One of the things I appreciate about Norman Hardie’s wines –
  besides obviously the wines themselves, though the two aren’t mutually exclusive – is his philosophy behind the wines.
  Here’s a snippet from the website:

  I’ve chosen Southern
  Ontario to grow and vinify cool climate varietals, because I truly feel that
  these soils are unlike any other in the New World. As the worldwide market
  grows, the majority of wines available to us have been carefully manufactured to
  fit a flavour profile as opposed to smell and taste like the region they came
  from. I strongly believe in the importance of crafting wines that tastes of the
  place they came from. The French know this notion as “terroir”. Matt Kramer
  (Wine Spectator) calls it “Somewhereness”.

  I like this approach because I feel exactly the same way
  about architecture and cities. Who wants a city that looks and feels like every
  other city in the world? That’s boring, bland, and banal (couldn’t resist the
  alliteration).

  In my opinion, the best buildings respond to their local
  context and the best cities create a unique sense of place. They create
  somewhereness.  

  2015.10.27