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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Tag: laneway housing

  • Okay, fine, I support your laneway house

    This week, I received a notice in the mail that a neighbor to Mackay Laneway House is seeking variances for their own laneway house. I immediately thought to myself, “oh, the hypocrisy.” Here is a neighbor that vehemently opposed my Committee of Adjustment application back in 2017 and now wants to do something similar.

    It’s also not like you need minor variances in order to build a laneway house today. They are, as many of you know, permitted as-of-right. That’s how MLH was ultimately built. We went straight to building permit. But in this case, the request is for 7 variances to the current by-law. The build aspires to go above and beyond.

    As I’m sure you can imagine, there’s part of me that wants to be a real asshole here. But of course, that would run counter to many of the objectives that we regularly cover on this blog: more housing, revitalized laneways, and so on. So I can’t do that. It’s directionally the right city building move, and they have my full support.

  • 4 predictions for Toronto’s laneways

    Brigitte Shim (of Shim-Sutcliffe Architects) invited Gabriel Fain and I to the Daniels Faculty this morning (at the University of Toronto) to talk about Mackay Laneway House.

    It was for a class on laneway housing and, as it turns out, some of the students had been using MLH as a case study. That’s pretty cool, although the primary lesson is probably “don’t build next to large trees.”

    Following the presentation, we had a good discussion about laneways, and it reminded me of some of the things that I believe to be true. More specifically, it reminded me of what I think will happen in the future:

    • Bona Fide Streets: Laneways will become bona fide streets. Meaning, they’ll get real names (most don’t have one today) and they’ll get serviced. Today, laneway suites are typically serviced via the main/existing house.
    • Severable Lots: Laneway lots will become severable. Right now this is strongly discouraged, because the intent is to create new rental housing and not new for-sale housing.
    • Market Inversion: Once these lots become severable, the market will then be able to decide which frontage is most valuable — the current street side or the laneway side. Maybe some get split right down the middle (50/50) or maybe some get biased toward one frontage. Either way, I think it will become common for the laneway frontage to be more desirable given its intimate scale and pedestrian orientation.
    • Mixed-Use: Non-residential uses will become allowed.

    I have no idea when all of this might happen, but I believe it will happen. So I wanted to write it down publicly.

  • Rear-yard suites and secondary suites built in Toronto over the last decade

    Here is a mapping, from the University of Toronto’s School of Cities, showing the number of “closed” building permits issued in Toronto between 2013 and 2023 for both rear-yard suites (laneway houses and garden suites) and secondary suites (like basement apartments).

    A “closed” building permit probably means that construction is complete. However, it is not uncommon for a permit to inadvertently remain open. This happened to me with Mackay Laneway House. The permit was supposed to be closed, but it wasn’t.

    So here’s the same mapping with open (i.e. active) permits also turned on:

    Three things immediately stand out:

    1. Secondary suites seem to be somewhat evenly distributed across the city.
    2. Rear-yard suites are heavily concentrated in the older areas of the city, flanking the downtown core.
    3. North Toronto is wealthy and isn’t having either of these housing typologies.

    Looking at these mappings, it probably seems like a decent amount of new housing. But that’s not really the case:

    • From 2013 to 2023, Toronto issued 2,209 building permits for secondary suites (1,525 have been closed and 684 remain open as of December 31, 2023).
    • And from 2020 to 2023, Toronto issued 898 building permits for rear-yard suites (192 have been closed and 706 remain open, which does suggest some increased adoption). Rear-yard suites only became permissible in 2018, which is why the date range is shorter.

    To be fair, I would imagine that many secondary suites get built without a building permit. So I think the above number is probably underestimating actual supply. But even still, it doesn’t change the conclusion: A lot more needs to be done to increase the supply of new housing in Toronto.

  • What happened in 2023

    As per tradition around here, I like to bookend the new year with two posts: a post that revisits my random predictions for the year and a post that talks about what might happen in the year to follow. Today’s post is the former. So let’s see how I did:

    • I thought the interest rate hikes would come to an end in Q1-2023. But that didn’t happen until the summer. I also thought this would lead to a mild recession in Canada. Technically, we are not actually in one, but according to some, we kind of are.
    • I thought the real estate sector would start seeing some distress in the first half of the year, and that a new equilibrium would be found in the second half. This proved to be overly optimistic in terms of timing. A lot ended up being on pause for the entire year, and I now think that my forecast was at least a year too early. The sea change is still underway.
    • Given the overall slowdown in real estate, I felt that construction costs had to see some softening. This did, in fact, happen with some of the “earlier trades”, such as shoring and excavation, and we did see some specific trade pricing, such as concrete formwork, come down by as much as 30%. The smart cost consultants we work with now expect to see overall hard costs come down by a further 5-6% next year in Toronto. This makes sense given construction starts are way down.
    • With me expecting the interest rate increases to stop in Q1, I thought that pre-construction condominium sales would return in a meaningful way by the spring. While we did see some buoyancy around that time, it was short lived. Sales remained nearly shutoff for the entire year, but for maybe a handful of projects. The more successful projects tended to be outside of the Toronto core and at lower price points.
    • With respect to home prices in more tertiary/fringe markets, my sense then, as it is now, was that these prices would remain below the peaks for many years. In addition to the upward momentum created by low rates, my view was/is that some of this pricing was the result of a bet on urban decentralization. I don’t think that has played out as many expected it to, so that’s why I think it will be many years before the pricing we saw in early 2022 returns.
    • The momentum around “expanding housing options” in our low-rise neighborhoods is many years in the making. And a lot of progress was made in 2023. Here in Toronto, we adopted new multiplex policies that now allow fourplexes plus an accessory dwelling (so 5 homes in total) on an as-of-right basis. I continue to believe that this momentum is only going to grow. I also think we will see the arrival of more mixed-use opportunities.
    • I believed that, broadly speaking, urban transit ridership would remain below pre-pandemic levels for all of 2023. This proved to be the case for most US and Canadian cities. But things are improving. For Canada as a whole, it looks like we’ll see full recovery sometime in 2024 based on this trend line.
    • I thought 2023 was going to be the year I took my inaugural ride in an autonomous vehicle. Sadly, this didn’t happen. The sector as a whole also saw some setbacks. Hopefully I’ll get a chance next year.
    • I assumed that Apple would finally release its augmented reality device. And though they didn’t technically release Vision Pro, they did announce it. So I guess that counts for something. I also thought that 2023 would be a big year for “phygital” goods. Maybe it was. Or maybe it was more of a building year. A lot of people are curious to see how Vision Pro does in 2024. It’s not set up for the mass market, just yet, but I think it will do exactly what it is supposed to once it’s out in the wild.
    • Finally, crypto. I know that a lot of you like to skip over these posts, but it is something that I feel strongly about. A year ago, though, I was pretty bearish on Solana. Boy was I wrong. Solana ended the year as the best performing major crypto asset — up 933% at the time of writing this. Oops! However, Ether is also +91%, and I continued to dollar-cost average in all throughout the year.

    Next up: What will, or more accurately, what might happen in 2024.

  • Toronto’s laneways should be mixed-use

    Up until last year, non-residential uses within Toronto’s low-rise neighborhoods were typically legal non-confirming uses. Meaning, the use wasn’t technically allowed, but if it had been there for a long and continuous time, we would let it slide and say it’s legal.

    Then we decided that small-scale retail, service, and office uses might be kind of good in our neighborhoods. Especially if they empower people to perform their daily necessities without a car. So we agreed to allow these sorts of uses provided they don’t annoy too many people.

    But what about in Toronto’s laneways? Can and should they go there, too?

    Recently, we’ve spoken a lot about the case for bottom-up city planning, and the value of micro-spaces and micro-businesses (à la Tokyo). And my overarching argument has been that these are a positive thing for cities. They create opportunity by lowering the barriers to entry.

    But we need to get out of the way and we need small and affordable spaces. Which is why it’s hard to imagine a more ideal place than in our laneways, especially considering that there’s a long history of these spaces being used for exactly this. (Read this recent article by John Lorinc.)

    Fortunately, this idea continues to gain positive momentum, thanks to people like the late Michelle Senayah (co-founder of the Laneway Project) and Blair Scorgie (a partner at Sajecki Planning). So in my mind, it’s only a matter of time before we start getting out of the way.

  • Thank you for your service, Gregg

    It was bittersweet to learn last week that Toronto’s chief planner — Gregg Lintern — will be retiring at the end of this year.

    He accomplished a lot during his six-year tenure. Here’s an excerpt from a recent Globe and Mail article by Alex Bozikovic:

    “…he took the department through significant reforms: allowing new houses in back laneways, then garden suites; eliminating minimum parking requirements; even legalizing four-unit apartment buildings on any lot in the city.“

    All of this was not easy, as anyone in our industry will attest.

    I also got to know Gregg, a little, by way of our development projects. And I can say that he (1) genuinely loved our great city and (2) was always looking for ways to make things better, whether that be through planning policy or through processes internal to City Hall.

    Thank you for your service, Gregg.

  • Exactly how gentle does gentle density need to be?

    This proposal by Dubbeldam Architecture + Design, called Incremental Density, is both an obvious step in the right direction and a problem. It is directionally right because it is exactly the kind of “gentle density” that we need and that many of us hope to see in our cities.

    Four to six storeys, prototypically built on an as-of-right basis all across city, possibly by small-scale owner/developers. In fact, this approach is one of the things that Toronto’s new mayor, Olivia Chow, has been speaking about on her first day in the office:

    Further, Chow said she wants to make it “easy and fast” for those who want to “build up” their single-family, often detached, homes to address what is known as the “missing middle” due to a history of “red tape” around zoning.

    “What I’m saying is ‘build, build, build, build,’ up to four storeys if you want to have four units,” she said. “You can rent out three of them and some money right. Then you are creating more housing, and you’re earning some extra dollars,” she continued.

    “So I want to unleash the power of the homeowner and say to them, ‘go build it,’ because we need housing right here now.”

    Here’s the problem, though. I’m going to go out on a limb and assume that at least a few people will not want 6 storeys beside them and their backyard. I mean, I struggled with a 2.5 storey laneway house for many years. (11 to be exact.)

    So how do we get from where we are today to what you see above? It’s going to take some finessing. Maybe it’s only in specific areas and on certain sites to start, or maybe we need to gradually increase the massing over time. Either way, I too am ready to “build, build, build, build.”

    What do you all think of this proposal?

    Images: Dubbeldam

  • How to create narrow European-style streets

    If you’re a regular reader of this blog, you’ll know that I have a thing for narrow streets. Which is why when I travel I sometimes (okay, oftentimes) bring a laser distance measuring device with me. I like measuring things so that I have dimensions that I can feed back into our own development projects. But perhaps most importantly, it allows me to appear as nerdy as humanly possible while traveling. Walking around with just a camera in hand isn’t enough. You need to try harder than that. And so far the narrowest street that I have come across was in Noto, Sicily at just over 1.3m wide.

    If you also like to fawn over narrow European streets, you may enjoy this recent video by City Beautiful. In it, Dave Amos compares European cities, like Rome, to US cities, like Salt Lake City and Philadelphia, and then asks: Can the US build European-style street networks? His immediate answer is, “probably not.” And this is something that we have talked about before on the blog. Street networks tend to be really sticky. They’re hard to change. However, there is another possible solution: create new smaller mid-block streets. And that’s the focus of Dave’s video:

    But if you think about it, this condition already exists in a number of cities. Here in Toronto, we have somewhere around 300 kilometers of laneways, which tend to range in width from 4 to 6m. These are European-scaled streets and amazingly they’re already in place! The only difference is that, today, they mostly serve a back-of-house function. They provide access to garages. However, that is quickly changing with the introduction of laneway suites. And so over a long enough time horizon, our laneways are going to inevitably flip from back-of-house to primarily residential.

    Though maybe there’s even more we could do with this asset. European cities manage to fit retail, restaurants, patios, and more within 6m. Why not do the same with some of our narrowest streets?

  • I love narrow streets

    If you’re a regular reader of this blog, you’ll know that I’m a fan of narrow streets. It’s one of the reasons I have been such a supporter of laneway housing here in Toronto, and why I think they should ultimately allow for some non-residential uses.

    If you have narrow streets and reasonably decent buildings that frame them, you have a base condition that has worked remarkably well since the creation of cities. Almost by default, and even if you don’t have proper sidewalks, it is going to feel pedestrian-oriented.

    The challenge, however, is that it’s usually difficult to create these after the fact. Street networks are powerfully sticky; they generally don’t change unless you have someone like Haussmann rebuilding your city. So if you have these in your city, try and take advantage of them. You’re fortunate to have them.

    The above two photos/measurements are from Milan. Both streets are around 20 feet wide (or 6 meters), which happens to be the required width of a standard two-way drive aisle here in Toronto. It’s a good example of how differently cities can view and allocate space.

    You can do a lot with 6 meters.

  • Will fourplexes be actually feasible in Toronto?

    Last week I wrote about Toronto’s plan to make fourplexes as-of-right across the city, but also why this form of missing middle housing shouldn’t have a maximum floor space index.

    Today, let’s look at the numbers in a bit more detail.

    If you look at a zoning map of Toronto, you’ll see that many neighborhoods across the city have a maximum floor space index (FSI) of 0.6. What this means is that if you have a piece of land like this:

    • Lot width: 20′
    • Lot depth: 115′
    • Site area: 2,300 sf

    Your total allowable gross floor area would be 1,380 square feet (0.6 x 2,300 sf).

    If you build a laneway suite in this city, that won’t count towards your total allowable GFA (otherwise they’d be very challenging/impossible to build). But if you want to build something like a triplex or a fourplex, it counts.

    The one important caveat is that if you’re building a residential building — that isn’t an apartment building with 5 or more homes — you can deduct the floor area of the basement:

    This, of course, helps the situation. But it doesn’t solve all of our problems.

    If you assume that the basement can be one home, that still only leaves 1,380 square feet for the other three, technically permissible, homes. This equals: 3 homes x 460 square feet.

    Another option would be 2 homes x 690 square feet. But still, we’re not exactly making it easy to deliver more “family-sized homes” in the city.

    And herein lies one of the problems (plural, because there are others). We can say that fourplexes are allowed across the city, but it may not actually be technically feasible or practical to build them.

    Note: I am not a planner. If you are, leave a comment below.