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: new york city

  • Airbnb’s S-1 is now public

    Airbnb’s IPO documents recently went public.

    Not surprisingly, their business as a travel company has been heavily impacted by COVID-19. Last year, the platform saw 326.9 million nights and experiences booked, with 251.1 million being booked in the first nine months of 2019. This year, nights and experiences are down to 146.9 million for this same nine month period. Revenue is correspondingly down from $3.7 billion for the first nine months of 2019, to $2.5 billion for the first nine months of this year.

    But what is also clear from their data is that people still really want to travel and have new experiences. As soon as April passed and the Northern Hemisphere entered the normally busy Q3 travel season, domestic travel began to quickly ramp back up. For many, this likely took the place of international travel. See above chart.

    Of greater concern might be all of the regulation that now surrounds short-term rentals. As of October 2019, about 70% of the platform’s top 200 cities (by revenue) had some form of regulation impacting short-term rentals. But at the same time, no one city accounts for more than 2.5% of the platform’s revenue. So there’s strong geographic diversification.

    If you’d like to take a look at the company’s S-1, you can do that over here. And for those of you who might be curious, these are Airbnb’s top 10 cities based on revenue:

    1. London
    2. New York City
    3. Paris
    4. Los Angeles
    5. Rome
    6. Barcelona
    7. Tokyo
    8. Toronto
    9. San Diego
    10. Lisbon

  • Counties won by Biden generated 70% of America’s GDP in 2018

    Here is an interesting look at the economic geography of the recent US election. Similar to what they did for the last presidential election, Brookings has just analyzed each candidate’s aggregate share of US GDP broken down by the counties that they won. That’s what the above diagram represents. The blue and red tiles are showing the relative size of each county’s economy.

    In 2016, Clinton won 472 counties with nearly 66 million votes. These counties accounted for about 64% of US GDP at the time. Trump, on the other hand, won 2,584 counties with nearly 63 million votes. But these counties represented only about 36% of US GDP. (Note that Trump won the election with fewer total votes. This is the electoral college at work.)

    When Brookings published the above findings, votes were still outstanding for 11 counties. Most of them low-output. Still, Biden has won 477 counties with well over 75 million votes. These Democratic counties now account for about 70% of overall US GDP. Virtually every big economy county went to Biden in this last election. Los Angeles, New York City, Chicago, and so on.

    This is a big deal because it shows the great economic divide that exists in the US, as well as in many (most?) other countries around the world. This is the urban vs. rural divide. Places with very different economic bases and, therefore, very different sets of priorities.

    Diagram: Brookings

  • CloudKitchens has spent more than $130 million on property over the last two years

    According to a recent Wall Street Journal review of property and corporate records, Travis Kalanick’s ghost kitchen startup, called CloudKitchens, has spent over $130 million over the past two years buying more than 40 properties in about two dozen cities.

    Travis is co-founder and the former CEO of Uber and this latest startup provides commercial kitchens to restauranteurs who are looking for a low-cost way to launch delivery-only food concepts.

    In some ways, it can be compared to coworking spaces for delivery-only restaurants. Instead of renting a full restaurant space, you lease 200-300 square feet of real estate at a lower cost address. CloudKitchens then handles all of the distribution and fulfillment, effectively lowering the barriers to entry for food startups.

    Some of the properties that they have been buying include a vacant restaurant space in Miami Beach for $9.2 million (May 2020) and an industrial property in Queens, New York for $6.6 million (March 2020). They’ve also bought in cities like Portland and Las Vegas.

    As you might imagine, now is a pretty good time to be buying some of these properties. And if you think about it, there are some real cost advantages to what they are doing, not to mention some co-working-style arbitrage on the real estate.

    The company is apparently going to great lengths to conceal what and where they are buying. But what is perhaps more interesting is their asset-heavy approach. They’re buying lots of real estate, which is inline with what companies like Opendoor are doing, but is distinct from Uber’s asset-light approach.

    It is also different from what many other ghost kitchen startups are doing. It seems that most are leasing their spaces. There has to be a reason for this difference.

  • The Map: Geometry vs. geography

    A friend of mine sent me this video today in a brief email that basically said, “you’re gonna love it.” Naturally he was right. It’s great. The 10-minute video is about how creative agency Work & Co rethought and redesigned New York City’s subway map for today’s digital age. Rather than a static map, which is historically how all cities have communicated their transit networks, they created a digital map that changes both as you interact with and as the network itself changes (closures, time of day, etc.). This means that they no longer had to make certain design compromises. They no longer had to choose between geometry (clarity of representation) and geography (accuracy of representation). The system does both.

  • The WRLDCTY 2020 Virtual Festival

    This Thursday is the launch of a brand new city event called the WRLDCTY Virtual Festival (vowels, clearly, suck). Presented by Vancouver-based Resonance Consultancy, the “host cities” are New York, London, Hong Kong, Los Angeles, and Toronto.

    The idea is to bring together thought leaders and city lovers from all around the world on a virtual platform for three days. The speakers include people like Richard Florida, Bjarke Ingels, and Dan Doctoroff.

    The other thing they’re doing is offering up over 20 virtual urban experiences. Think yoga on Santa Monica Pier, burlesque in Brooklyn, and graffiti art tours in Toronto. It’s clearly no substitute for actual travel, but this is the best we’ve got right now and we’re all trying to adapt.

    A general admission ticket is free, but some of the headline events require a pro pass and if you’d like to do some virtual networking and chat with other guests in the “Community Center,” you’ll also need that same pass. Here’s the full agenda.

    Photo by veeterzy on Unsplash

  • Tech and New York City

    Tech:NYC has just launched a new podcast called Talk:NYC. The first episode is with venture capitalist and blogger Fred Wilson. (Though, it should be noted that Fred and his wife, Joanne, are also involved in the real estate development space.) In this episode, Julie Samuels and Fred Wilson talk about why he came to New York, how to manage through a downturn, where working spaces are going, and why the magic of New York is still there — among a bunch of other things. Click here if you can’t see the embedded podcast below.

    https://soundcloud.com/user-212806065/talknycep01fredwilson

  • New York City makes outdoor dining permanent

    New York City just made its “Open Restaurants” program permanent. Originally set to expire at the end of the October, the al fresco dining program — which allows restaurants to use sidewalks and curb lanes adjacent to their business — is now being thought of as something that will permanently reshape public space in the city.

    Along with this announcement, the City also provided clarity on how heating and enclosures may be used throughout the winter months. Electrical heaters can be used anywhere. But propane heaters can only be used on sidewalks and you’ll need to get a permit from the fire department. Prior to this announcement, there was an outright ban on propane heaters.

    Tents and other enclosures are now permitted, but at least 50% of the side walls needs to remain open for ventilation. Otherwise it gets classified as indoor dining and those rules would then apply. However, fully enclosed structures, such as cool looking Instagrammable domes, are allowed for individual parties provided there’s “adequate ventilation.” Whatever that means.

    This is yet another example of how COVID-19 is forcing us to reconsider the way we think about and use public space within our cities — perhaps forever. And in this particular case, it’ll be interesting to see to what extent cities embrace dining outside in the winter. Some of us already do it when we, for example, après ski. Could the same thing work in our cities?

    Photo by Aleks Marinkovic on Unsplash

  • New York City isn’t dead

    I was speaking to some friends in New York City over the weekend and they said to me, “you know what Brandon, we don’t really go out at night anymore. It doesn’t feel safe. There are homeless people everywhere and they’ve started to get very aggressive, particularly against Asians.”

    They live in a good neighborhood in Manhattan.

    I was somewhat surprised to hear this, but at the same time, I don’t think for one minute think that New York City is dead. But some do, including James Altucher. James moved to Florida because of the pandemic and recently penned an article in the NY Post called, “New York City is dead forever.”

    That didn’t sit well with Jerry Seinfeld and so this morning he published a rebuttal op-ed piece in the New York Times. It has been making the rounds online today with people responding from both sides of the fence. Richard Florida responded with this tweet thread.

    If you’re a regular reader of this blog, you’ll know where I sit on this topic. I love technology, but sitting at home all day going from Zoom meeting to Zoom meeting is not the kind of life I aspire to live. I agree with Jerry. There’s no energy. In fact, it sucks the energy right out of me.

    With that, I’ll leave you with some more words from Jerry Seinfeld:

    There’s some other stupid thing in the article about “bandwidth” and how New York is over because everybody will “remote everything.” Guess what: Everyone hates to do this. Everyone. Hates.

    You know why? There’s no energy.

    Energy, attitude and personality cannot be “remoted” through even the best fiber optic lines. That’s the whole reason many of us moved to New York in the first place.

    You ever wonder why Silicon Valley even exists? I have always wondered, why do these people all live and work in that location? They have all this insane technology; why don’t they all just spread out wherever they want to be and connect with their devices? Because it doesn’t work, that’s why.

    Real, live, inspiring human energy exists when we coagulate together in crazy places like New York City. Feeling sorry for yourself because you can’t go to the theater for a while is not the essential element of character that made New York the brilliant diamond of activity it will one day be again.

    Photo by Florian Wehde on Unsplash

  • How local is local, really?

    Real estate, as they say, is a local business. Every market has its local nuances. For example, once of the first things that Studio Gang asked us when we started working together was, “does Toronto do PT?” What they were referring to was post-tensioned concrete and our answer was, “not really.” There are certainly examples of localized applications within buildings (such as for a specific transfer slab) and there are examples of buildings that have used it throughout (see Pier 27 Tower below — it’s how they managed to get such deep balconies). But for the most part, it’s not widely used and it’s certainly not as common as it is in markets such as New York. This subtle difference has an impact on how you design, which is why Studio Gang asked it from the outset.

    Despite some of these local differences, there is a criticism out there that we have descended upon a kind of bland global design sensibility. No matter where you’re building, every building now looks the same, which, at the end of the day, was kind of the point of the International Style of architecture. One design approach applied universally. This recent article by Edwin Heathcote takes things even further by saying that our interiors have also been sterilized to look more or less the same as a result of “digital aesthetic seepage.” The article is called, “The curse of the Airbnb aesthetic.”

    One the one hand, there is something inevitable about this outcome. We — including our supply chains — have become more interconnected than ever. And because of the high cost of labor, the way we build today is centered around as much factory automation as possible. Minimize what needs to be done on site. And given that I would expect more, rather than less, automation going forward, one has to assume that this trend is destined to continue. At the same time, local places matter and one of the reasons why so many of us love to travel is that we want to see places that are different than our own. I for one don’t want that to change.

  • The global effort to build more bike lanes

    I received an email this week from a senior real estate executive who was sharing the fact that, in response to COVID, he had decided to give up driving completely. He was now cycling everywhere — whether for work or for personal errands. And it was doing wonders for his health and his overall well-being.

    Indeed, this feels like some sort of golden era for urban cycling. Back in May I wrote about how Toronto City Council had just approved the largest ever one-year expansion of bike lanes. Some 40 km. When have we ever moved this quickly and without months (okay, years) of painful debate? Probably never.

    Of course, it’s not just Toronto. This is happening all over the world. Here are some of the numbers (taken from this recent Journal article):

    • Paris added 400 miles of pop-up bike lanes across the region — all of which didn’t exist before the pandemic – some of the streets being tracked have seen a doubling in usage
    • Oakland closed almost 10% of its streets to cars
    • Montreal is adding an additional 70 miles of pedestrian and cycle paths
    • Bogota is the midst of planning for 47 miles of temporary bike lanes
    • The UK has fast tracked over $315 million in capital spending for bike infrastructure — referring to this as a “once-in-a-generation” opportunity
    • New York’s bike share service (Citi Bike) saw year-over-year usage surge 67% in the first 10 days of March alone — before any shelter-in-place rules were even imposed

    There are obvious reasons for this rush to build out cycling infrastructure. We’re in the midst of a global health crisis and people are staying away from public transit in big numbers. But I think it’s also important to keep in mind that in many / most cases, there is really no other viable mobility solution. You cannot take all the people that used to ride the tube in London and plop them into cars. There isn’t enough space.

    So cities all around the world are doing the sensible thing and acting fast to make sure that it’s safer for people to move about on bikes. But as we all know, humans tend to have a bias toward the status quo. And so when this is all said and done, I suspect that many of these pop-ups will end up sticking around. And that will be a good thing for cities.