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

  • HQ2 isn’t coming to Toronto

    So I was wrong. Amazon didn’t pick Toronto for HQ2. It instead picked Crystal City, Virginia (Washington) and Long Island City, NY (New York City). More on that, here, in the NY Times. Confession: My prognostication was at least partially about trying to create a self-fulfilling prophecy.

    In any event, it’s interesting to consider the locations that they did pick – as well as the fact that they ended up picking multiple cities. This was not part of their RFP. Though, many have convincingly argued that this process was over before it even began. HQ2 was always going to end up on the east coast, near one of Bezos’ homes.

    Nevertheless, urbanists such as Aaron Renn took the announcement as a direct repudiation of the American heartland. He believed that Amazon would be far more cost conscious in their decision making and ultimately elect for a lower cost locale in the middle of the country. Instead, the coastal hegemony won out. 

    Joe Cortright of City Observatory correctly predicted that Amazon would, for a few reasons, parlay their HQ2 search into multiple smaller locations (HQ2, HQ3, and so on). One of the reasons for this is that it gives the company more leverage when it comes negotiating subsidies on a go-forward basis. If NYC doesn’t want our next round of hires, we’ll take them to Washington.

    Looking at the locations, one of the first things I noticed is that both are just outside of their respective “downtowns” (across a body of water), as well as adjacent or on the way to an international airport. Crystal City is across the street from DCA and Long Island City is a 15 minute drive from LGA. Both are situated on top of higher order transit. Makes sense to me.

    Now, who wants HQ4?

  • Average age of a first-time mother

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    According to a recent study in the New York Times, the average age of a first-time mother in Manhattan is 31.1 years old. In San Francisco County, the number is nearly 32. And in the US as a whole, it was 26.3 in 2016.

    This is what the national distribution looked like in 1980:

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    And this is what it looked like in 2016:

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    Perhaps not surprisingly, the biggest factor influencing the age of a first-time mother is education. Becoming educated and building a career takes time. First-time mothers tend to be older in big cities (particularly on the coasts) compared to rural areas.

    The concern that researchers have with all of this is that it is symptomatic of growing inequality. Scrolling over the NY Times’ map, it would appear that there’s nearly a 10 year gap between the coasts and many parts of the country.

    On the one hand you have people who are finishing high school and having kids fairly soon after. And on the other hand, you have people going to college, establishing their career, and waiting, in some cases a decade, to have kids.

    This is significant because it can create a virtuous circle (excerpt from article):

    “A college degree is increasingly essential to earning a middle-class wage, and older parents have more years to earn money to invest in violin lessons, math tutoring and college savings accounts — all of which can set children on very different paths.”

    Unequal childhoods can lead to unequal outcomes.

    Images: New York Times

  • The Trump family real estate empire

    He is tall, lean and blond, with dazzling white teeth, and he looks ever so much like Robert Redford. He rides around town in a chauffeured silver Cadillac with his initials, DJT, on the plates. He dates slinky fashion models, belongs to the most elegant clubs and, at only 30 years of age, estimates that he is worth “more than $200 million.” 

    –Judy Klemesrud, New York Times, 1976

    Last week the New York Times published a special investigation looking at the Trump family’s real estate empire and the suspect tax schemes that they allegedly employed over the years to preserve, grow, and pass it down. 

    According to the Times, all of which has been rebuked by a lawyer for the president, Donald Trump received at least $413 million in today’s dollars from the family empire. 

    I just finished reading the investigation in its entirety. It’s a long one. But if you’re interested, you can do the same here. If you’d prefer the Coles Notes version (Cliff Notes for you Americans), have a scroll through the headlines in this article instead.

  • A more distributed startup geography

    The Economist recently argued that Silicon Valley’s innovation hegemony is waning and that it is a product of two factors: there appears to be more innovation happening elsewhere (good news), but that innovation in general also seems to be harder to achieve (bad news). Here is an excerpt from the article:

    Other cities are rising in relative importance as a result. The Kauffman Foundation, a non-profit group that tracks entrepreneurship, now ranks the Miami-Fort Lauderdale area first for startup activity in America, based on the density of startups and new entrepreneurs. Mr Thiel is moving to Los Angeles, which has a vibrant tech scene. Phoenix and Pittsburgh have become hubs for autonomous vehicles; New York for media startups; London for fintech; Shenzhen for hardware. None of these places can match the Valley on its own; between them, they point to a world in which innovation is more distributed.

    Part of the problem, of course, is rising costs in the Bay Area. Everything from the cost of living to the cost of operating a business. The article cites a recent survey where nearly half of all respondents said they are planning to leave the Bay Area in the next few years. This is up from 34% only two years ago.

    I don’t doubt that rising costs are causing some people to look to other cities, as well as other countries in the case of draconian visa policies. But I am suspect of the claim that we’ve heat peak “innovation” – however you want to define that.

  • Building height fallacy

    Studio Gang has a project currently under construction in New York City called 40 Tenth Avenue. It is also known as the “solar carve tower.” Here are a couple of progress photos taken by Timothy Schenck. The glass is beautiful. (If you can’t see the embedded tweet below, click here.)

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    This is one of my favorite buildings by Studio Gang and one that we all studied when we were kicking off One Delisle. 

    The geometry of the building is a result of carve outs that maximize the amount of sunlight that is able to reach the adjacent High Line (public space). It is form driven by functional logic. Here is a diagram from Studio Gang showing the carve outs that result from the sun’s rays.

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    The other thing I like about this project is that it is a clear proof of something that I’m going to call the “building height fallacy.” There can be a tendency to overfocus on building height, which I have argued against before on this blog. 

    In this case, a shorter and squatter building without these solar carve outs, would have actually been worse for the High Line and the surrounding environment in terms of access to light and air.

    The building is responding to site-specific criteria – which is what great architecture should do.

  • Toward a Concrete Utopia: Architecture in Yugoslavia, 1948–1980

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    A new exhibition on postwar architecture in (the former) Yugoslavia opens up today (July 15) at the Museum of Modern Art in New York. It’s called, Toward a Concrete Utopia: Architecture in Yugoslavia, 1948–1980, and it runs until January 13, 2019.

    Here is a bit more about the exhibition:

    Situated between the capitalist West and the socialist East, Yugoslavia’s architects responded to contradictory demands and influences, developing a postwar architecture both in line with and distinct from the design approaches seen elsewhere in Europe and beyond. The architecture that emerged—from International Style skyscrapers to Brutalist “social condensers”—is a manifestation of the radical diversity, hybridity, and idealism that characterized the Yugoslav state itself.

    And here is a panel discussion about the exhibition (click here if you can’t see the video below):

    [youtube https://www.youtube.com/watch?v=M2S0bBTHu-8&w=560&h=315]

    Architecture tells you a lot about a place and what was happening at the time in which it was built. I would love to see this exhibition and I hope to do exactly that if I’m in New York City before the new year.

    Image: MoMA

  • How New York City became boring

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    On the cover of the July 2018 issue of Harper’s Magazine is a picture of New York City – with Rafael Viñoly’s 432 Park Avenue as the focal point – and the title: Death of a Great American City. New York and the Urban Crisis of Affluence.

    The long-form article is by Kevin Baker and it is an account of how New York City has transformed itself over the past few decades from a place of culture and character (and of cockroaches and discarded crack vials) into a place for the ultra-wealthy to buy ultra-luxury real estate that may or may not sit empty for more often than it is occupied.

    “As New York enters the third decade of the twenty-first century, it is in imminent danger of becoming something it has never been before: unremarkable. It is approaching a state where it is no longer a significant cultural entity but the world’s largest gated community, with a few cupcake shops here and there. For the first time in its history, New York is, well, boring.”

    This narrative and/or phenomenon is of course not unique to New York City, though it is surely more pronounced when you are one of, if not the, preeminent global city. In fact, I was sent this article by a reader who was wondering about the possible parallels here in Toronto. Thank you Natasha.

    The desire, which is how Baker ends his article, is that New York City should be a city of “workers and eccentrics” as well as “visionaries and billionaires.” It should be a place for “street photographers” and “hedge fund operators.” That sounds like a pretty cool place to me.

    But we all know how challenging this has proven to be for cities.

    Photo by Dean Rose on Unsplash

  • Shift toward the center

    The New York City Department of City Planning has a very cool “metro region explorer” online that allows you to explore population, housing, and employment trends in the tri-state NYC Metropolitan Region. Start here and then click on “Learn More” to cycle through the slides and data.

    One interesting takeaway is that population growth continues to centralize in the region’s core. Since 2010, 60% of the region’s population growth has taken place in the five boroughs of New York City, and in particular it has occurred in neighborhoods with strong rail transit.

    There has also been a slowing in terms of the number of residents leaving New York City. Historically, people moved to the city in their 20′s and left in their 30′s. That trend is slowing.

    I suspect this has to do with a combination of factors, including the shift toward a city-centered knowledge economy; the desire for walkability and urban amenities; the phenomenon of people getting married later in life (if at all); and so on.

    The people who do leave the city are also more likely to leave for other parts of the U.S. than other parts of the region. This has led to a decline in the number of prime age (25-54 years old) workers in the suburbs.

    Check out the Metro Region Explorer, here. There’s a lot of good stuff in there.

  • What’s Manhattan worth?

    I like looking at real estate values over longer periods of time because it helps to put things into perspective. 

    Below is a land value index for Manhattan running from 1950 to 2014 that was recently created by economists out of Rutgers University.

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    The study was also cited in this recent article by Richard Florida.

    Here are some of the highlights from their study:

    We find three major cycles with land values reaching their nadir in 1977, just after the city’s fiscal crisis.

    Since 1993, land prices have risen much faster than population or employment, at an average annual rate of 15.8%.

    We estimate the entire amount of developable land on Manhattan in 2014 was worth approximately $1.74 trillion.

    We estimate the long run return to Manhattan land values [since the island was first inhabited by Dutch settlers in 1626] to be about 6.4%.

    What’s fascinating to me is the accelerated appreciation. The index starts at 100 in 1950, ends up slightly above that by 1993, and then simply takes off.

  • New York City’s retail vacancy problem

    The New York Post has some interesting articles, here and here, on the growing retail vacancy problem in NYC. (Thank you Michael for the link in the comments this week.)

    The vacancy rate on Amsterdam Avenue in the Upper West Side is said to be around 27% and it is said to be around 20% on a stretch of Broadway in Soho. It has become such a problem that Mayor Bill de Blasio wants to implement some sort of retail vacancy tax:

    “I am very interested in fighting for a vacancy fee or a vacancy tax that would penalize landlords who leave their storefronts vacant for long periods of time in neighborhoods because they are looking for some top-dollar rent but they blight neighborhoods by doing it,” he said on WNYC. “That is something we could get done through Albany.”

    But this is based on the assumption that greedy landlords are simply holding out for exorbitant rents. It doesn’t consider the fact that, maybe, there is simply too much retail space:

    Only a few grasp the true scope of the problem. Vornado Realty Trust titan Steven Roth said we can only cure the national plague through “the closing and evaporation” of up to 30 percent of the weakest space — which would take five years.

    All of this, of course, has me thinking about the future of ground floor main street retail. What are your thoughts?