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.

Tag: public transit

  • Rail + property — let’s try it again, okay?

    The Eglinton Crosstown line is going to open, here in Toronto, sometime next year — I think. And I’m sure that it is going to be a massively beneficial addition to Toronto’s transit network. But at the same time, we should be talking about this:

    Urban transit stations shouldn’t look like this. It’s a missed opportunity, both in terms of the foregone housing (and other uses) that could be on top of these stations and the additional value that could have been captured from these air rights. Transit is a crucial lever for land values and development overall, and so it’s no wonder that many of the best transit authorities around the world think in terms of “rail + property”.

    So what happened here?

    I don’t know exactly. But I do know that nearly a decade ago I called up Metrolinx and said, “Hey, so I’m a developer who can build things. I see that you’re building a number of exciting transit stations along Eglinton. Want me to build on top of them for you?” Now obviously Metrolinx wasn’t going to be able to sole-source to Brandon, but regardless, I thought it should happen and I just hoped to be in the mix.

    In 2015, things did start to happen. Avison Young, on behalf of Metrolinx, issued a request for proposal to developers for 4 sites/stations along the line. There were two at Keele Street, one at Weston Road, and one at Bathurst Street. And at the time, it was thought that these sites could generate somewhere between $14-22 million (speaking of reasonable).

    I think it was also being viewed as a bit of a pilot. If things went well with these 4 initial sites, then this same approach was going to be rolled out across all suitable sites on the line. I’m not sure what happened with the RFP or the broader intent — maybe some of you know — but it clearly didn’t pan out as planned.

    That’s too bad. But I suppose done is better than perfect. Plus, now we’re building the Ontario Line and so we have another opportunity to get it right. And right means lots of density on top of stations — both directly on top and all around it.

  • Why so few people drive in Tokyo

    Daniel Knowles, who is a correspondent for the Economist, recently authored a book called Carmageddon: How Cars Make Life Worse and What to Do About It. I haven’t read it, yet, but I did just read this excerpt about Tokyo, and it was jam-packed with interesting stats.

    Here are some of them:

    • Among developed cities, Tokyo has the lowest car use in the world. About 12% of trips are completed with a car, whereas 17% of trips are done with a bicycle. Most people walk and/or take transit. Tokyo has the most-used public transit system in the world — about 30 million people each day.
    • Car ownership across Japan is about 590 vehicles per 1,000 people. This is comparable to many European countries. In the US, it’s about 800 vehicles per 1,000. However, this figure drops in Tokyo. Here, the average is about 0.32 cars per household, which was interesting to see because most new housing projects in downtown Toronto have parking ratios that are much lower than even this figure.
    • The average size of a home in Tokyo is 65.9 square meters of usable area. By comparison, the average size of a home in London is 80 square meters. But given that according to Knowles, the average household size in London is 2.7 people, whereas it’s 1.95 in Tokyo. So per capita, Tokyoites actually have more space than Londoners.
    • 35% of streets in Japan are not wide enough to fit a car. If you add in streets that are wide enough to fit a car but not wide enough that a car could stop and not entirely block traffic, this figure jumps to 86%. This to me is a massively significant statistic, because if you want people to walk places you need small streets.
    • 95% of streets in Japan do not allow any sort of street parking — day or night.
    • The average Japanese car owner drives around 6,000 kilometers per year. This is about a third of what the average American does. In my case, it looks like I have averaged about 8,868 kilometers per year over the last 5 years. Though a big chunk of my kilometers would be from longer one-off snowboarding trips. In other words, I don’t drive all that often in the city.
    • Japan has some of the most expensive road tolls/prices in the world. Meaning, Japan does not actively subsidize driving and instead just charges drivers accordingly. Apparently the average is about 3,000 yen per 100 kilometers, which is about CA$30 per 100 kilometers.
    • In addition to not subsidizing cars, Tokyo is also one of the few cities in the world where their public transit does not need to be subsidized. A big part of this has to do with high ridership, but the other important part is that its transit authorities also develop real estate. Shockingly, this means that it tends not to build standalone and single-storey transit stations (ahem, I’m looking at you Crosstown LRT). Instead, they build lots of density where it always belongs: on top of transit.

    I may just have to read Knowles’ book.

  • US public transit ridership since March 2020

    Consider the following stat: 65% of all transit trips across the US in 2019 came from just 6 metro areas: New York, Boston, Chicago, San Francisco, Washington, DC, and Philadelphia. Not surprisingly, these are all places with dense and walkable urban centers. In other words, they have built environments that are conducive to the use of public transportation.

    While we know that more people working from home has been bad for transit and that agencies across the world are facing deep holes in their budget, I continue to come back to two things. One, we have not yet reached a post-pandemic equilibrium. We are still making our way back to the office. And two, the single most important thing when it comes to transit ridership is land use.

    If we want more people to take transit, then we need to build our cities accordingly. That means streets people actually want to walk on, and a lot more density.

  • The most expensive new subway line in the world

    In other New York City news, they apparently have the most expensive new subway line in the world:

    At $2.5 billion per mile, construction costs for the 1.8-mile Phase 1 of the Second Avenue Subway were 8 to 12 times more expensive than similar subway projects in Italy, Istanbul, Sweden, Paris, Berlin and Spain, according to a report from New York University’s Marron Institute of Urban Management.

    This is an important problem because public transit is good for cities:

    It is not possible to outdo the subway in capacity per amount of land consumed— and in a high-demand city, 12-lane freeways are prohibitively land-intensive. Hook (1994) argued that Japan focused on rail transportation in its largest cities because it had high land values in the postwar era and such strong property rights that widespread land condemnation for freeways based on the American model was impossible.

    If this is a topic that interests you, I would encourage you to check out the report, as well as their Transit Costs Project website. It allows you to compare transit project costs for 159 different cities.

  • San Francisco’s transportation agency doesn’t love autonomous taxis

    Cruise, the autonomous taxi service owned by GM, is working toward offering 24/7 service in San Francisco. I wrote about that here. And so it recently came out with some supportive data suggesting that between September and November of last year, it completed 2,800 rides covering some 27,000 miles, and that it did so without a major collision or injury.

    The San Francisco Municipal Transportation Agency, however, disagrees. They are opposing Cruise’s service expansion plans, and have reported 92 incidents where Cruise’s autonomous taxis have obstructed traffic, caused delays to transit, blocked lanes and, apparently in two cases, driven over firehoses.

    These two things are not all that surprising. Firstly, autonomous vehicles are still in their infancy and they are known to do silly things. Part of this, I’m sure, is because they’re programmed around road and life safety. And so if they don’t know what to do, they’re going to default to what is deemed safe, even if it means blocking a lane or obstructing traffic.

    Secondly, transit agencies are suffering in our post-pandemic world. So this is an obvious and understandable case of self-interest. And it’s not new. But at the same time, we’ve all seen this movie many times before, from Napster to Uber. Progress is disruptive. But does it really make sense to stop?

  • Our current public transit problem/opportunity

    Over the past few years, I have been writing about the fall off in public transit ridership that we have seen as a result of the pandemic. Most recently, I mentioned it in my predictions for 2023.

    This topic doesn’t seem to get a lot of air time, but it is a problem. Because the standard way to operate a transit system in North America is at a loss.

    According to this recent WSJ article, the average fare recovery ratio across the US is somewhere around 1/3, with the remaining 2/3 of operating costs being covered by public money.

    (Somehow Japan has figured out a way to make money on rail.)

    During the pandemic, federal aid was disbursed in order to maintain service levels. The MTA in New York, for example, received $15.1 billion. But these aid packages will eventually run out, and ridership has yet to fully return:

    New York’s subway system has regained about two-thirds of its pre-pandemic ridership with about 91 million trips in November, according to the MTA. But that is about 50 million fewer rides than in November 2019. Officials worry usage has stalled out at that level.

    In San Francisco, the Bay Area Rapid Transit, or BART, recorded 3.7 million trips in November—a little more than one-third of the ridership before Covid.

    The obvious answer is likely to be a combination of service cuts and/or more public money. But an even better answer would be to use this opportunity to figure out how to make our transit systems a little more Japanese.

    That is, let’s make them more financially sustainable. And yes, that is going to necessarily involve looking at how we build around and on top of transit.

  • Warren Buffet doesn’t like crypto and streetcars

    I have a great deal of respect for Warren Buffet. Much of what I know (or think I know) about investing has come from listening to and watching him and his partner Charlie Munger. Surely they have got to be the most successful investors living today.

    But there are some things that I don’t always agree with them on. The first and most obvious one is crypto. Warren thinks it is speculative rat poison and I think it is the future of the internet. I understand where he is coming from in that it does not produce cash in the same way as say a farm or an apartment building. But that doesn’t mean it won’t have value.

    The second one, as I have learned today, is maybe streetcars. As a rule, Warren doesn’t typically engage in local politics. But he recently decided to break that rule through a letter he wrote to the editor of the Omaha World-Herald, lobbying against a new $306 million project that I believe is going ahead regardless.

    Here’s an excerpt from the letter:

    “Residents can be far better served by extended or more intensive service by the bus system,” Buffett wrote. “As population, commerce and desired destinations shift, a bus system can be re-engineered. Streetcars keep mindlessly rolling on, fuelled by large public subsidies. Mistakes are literally cast in cement.”

    I should, however, be clear that (1) I know nothing about Omaha and this streetcar project, and (2) “streetcars” can be nuanced. There are streetcars that compete with car traffic and have short station spacing, and there is light rail transit on its own dedicated tracks and with farther station spacing. One size does not fit all.

    Here in Toronto, we have lots of the former and they generally move you around at the slowest possible speeds. Sometimes it is faster to just walk. But we are also getting a new light rail line next year and that should move much faster. I can also tell you that when I worked in Dublin many years ago, I took their Luas to the office every day and loved it.

    Again, I don’t know the specifics of Omaha’s streetcar project. Maybe Warren is right or maybe he is wrong. And that’s why I was careful to say “maybe” above. But I do know that in the right urban contexts and when done well, I am a fan of light rail transit.

  • Agenda-setting headlines

    I am so tired of sensational headlines:

    The Ontario Line will zip across the core and up to Eglinton, easing gridlock and alleviating TTC misery. It will also plow through peaceful Toronto neighbourhoods, displacing homes, businesses and everything in its path.

    I know exactly what business model it is serving and why it is done, but I’ll ask the question anyway: Why do we need to make everything out to be a problem?

    In this case, we’re talking about a new and important piece of city building infrastructure. A subway line that will run through the densest parts of this country and alleviate congestion at key interchanges, as well as broadly across the city.

    It is something that we, as a city, have been griping about for many decades. And now, it is finally happening! Will it involve constructing things? Yes. Will it actually displace “everything in its path?” No.

    But as we all know, this is the way media works today. They set the agenda (i.e. tell us what we should be terrified and/or pissed off about) and then they sell our attention. And an effective way to do that is to make sure that the headlines get us really worked up.

  • 10 years of contactless payments on London’s public transport

    I was having coffee this week with a self-described luddite and, after we ordered our coffees, he surprised me by pulling out his iPhone and initiating ApplePay. Knowing him and his general views on technology, I said, “I’m surprised that you of all people are now using ApplePay.” To which he responded, “I can’t believe it took me this long to start using it. It’s so convenient! I now barely ever pull out my wallet.” Yup, it is very convenient.

    It also just so happens that this month marks the 10 year anniversary of contactless payments on London’s public transport network. This meaning payment via a bank or credit card, and not via an Oyster card. In fact, part of the reason why London did this was because bus drivers were struggling with both having to give change and having to deal with people who didn’t have enough funds on their Oyster cards.

    So Transport for London (TfL) decided to spend £11 million, design and code the entire thing in-house, and then roll it out across the network starting in 2012. Apparently, adoption started off relatively slowly. At the end of 2013, only about 6 million journeys were made using contactless payments — this is against an initial projection of 25 million. But fast forward to today, and around 70% of all bus journeys are now contactless.

    What is also interesting about this is that TfL now licenses their contactless technology to other cities around the world. Here is a £15 million deal that was announced in 2016, which suggests that they could be generating a fairly respectable return on their initial investment. But aside from this, contactless payments are an obviously good way to onboard people onto public transport. There’s no special card. No lining up at a ticket kiosk. And yes, you can even use your phone.

    Photo by Tomas Anton Escobar on Unsplash

  • Why traffic fatalities are lower in Canada than in the US

    We’ve talked about this before. If you live in New York City, you’re probably about a third as likely to die from a transportation-related accident as compared to the average American. And if you live in Paris, you’re probably about a third as likely to die from a transportation-related accident as compared to the average New Yorker.

    These stats might feel a bit intuitive to you. Both New York and Paris are big and dense metros with high public transit ridership. And that usually translates into less car accidents. As for the divide between these two cities, Paris is in Europe. It’s old. Most of its streets were built before the car had been invented. And all of these things are generally good for pedestrians. Makes sense.

    But David Zipper asked a good question today: So what’s going on with Canada? Canada is not in Europe (though some might argue that it sits culturally somewhere between the US and Europe). It’s not that old. And it generally has a car-oriented landscape just like the US. So why is it that in 2020, Americans were 2.5x more likely than Canadians to die in a car crash? The trend lines are also diverging between these two countries. Between 2010 to 2020, US road deaths increased 19% on a per capita basis, whereas Canada’s rate declined by about the same rate, according to David.

    Ultimately, we are probably going to need Malcolm Gladwell to write a book about this so that we can really figure out what’s going on. But in the interim, David does propose a few possible explanations ranging from Canadians buying slightly smaller vehicles to Canadians being slightly more law-abiding than Americans and so less likely to run people over. But one of the most persuasive explanations for me is that maybe our urban landscapes aren’t actually the same.

    More than a third of Canadians live in our three biggest cities: Toronto, Montreal, and Vancouver. And this number would be even higher if you looked at the full urban catchment areas of each. Either way, this is a significantly higher concentration than in the US, where about 13% of Americans live in the metro areas of New York City, Los Angeles, and Chicago.

    Part of this difference is because the US has almost 9x more people and has many more big cities to choose from. But it doesn’t change the fact that, despite our reputed love for things like forests and beavers, Canadians are actually quite urban. And as we have discovered, that’s a good thing for pedestrians.

    Photo by Jamshed Khedri on Unsplash