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: real estate

  • The tallest residential building in the world

    Earlier this month, Extell Development Company announced the launch of sales for its Central Park Tower – which it is calling “the definitive New York skyscraper”, as well as the tallest residential building in the world. 

    The project is located on Billionaire’s Row in NYC and it will be 1,550 feet tall when completed. That puts it well into supertall territory.

    According to Curbed, the smallest apartments start at 1,435 sf and the largest will be an estate in the sky at around 17,500 sf. 

    The projected sellout for the project is, or at least was, $4 billion back in 2017. That will set all sorts of records upon completion. At the time of the above filing, the average price was pegged at $7,106 per square foot.

    If you’d like to read up on the project’s capital stack, you can do that here. And for those of us who are used to having to pre-sell condos before digging, you may find it interesting to know that this project started construction in 2014.

    I wonder how much a parking spot costs (assuming there is even parking).

  • Decline of children in some, but not all, parts of Chicago

    The Institute for Housing Studies at DePaul University recently published this overview of the “socioeconomic factors affecting demand for housing in Chicago.”

    Here is the change in population in the City of Chicago from 1950 to 2016:

    And here is a comparison between Chicago and the five biggest cities in the US. Note the “sun and sprawl” phenomenon. Also note that the list below is for city proper boundaries.

    One particularly interesting set of stats is the decline of children (population under the age of 18) in the city:

    Since 2010, the city has lost over 40,000 children and teenagers. 

    But, if you break it down by neighborhood market type, it is the low-cost and moderate-cost neighborhoods that lost the population. The high-cost neighborhoods were up.

    The study posits that the old trend of moving to the suburbs after you have kids may not be for everyone – provided, of course, that you have the means. And it goes beyond Chicago. DC is predicting a 25% increase in K-12 students within the District.

    For the rest of the charts, click here.

  • BIG’s IQON in Quito

    BIG just announced its first project in South America. It is a 33 storey residential building in Quito, Ecuador. When completed, it will be the tallest building in the city. The developer is Uribe and Schwarzkopf

    Here are a couple of other images:

    The building is made up of “concrete boxes” that, when rotated, create terraces for the apartments. On one corner of the building the apartments are “through-units”, meaning they have two exposures. In this case, it is north and south.

    While different, we are starting to see some similarities across BIG’s projects, which isn’t meant as a criticism. I am thinking of Telus Sky, Vancouver House, and even KING Toronto. 

    They are, at least partially, about expressing the individual apartments and creating opportunities for outdoor spaces. This also serves to break down the overall scale of the building.

    What do you think of the project?

    Images: BIG

  • Canadian minimalism

    I have one more note to share this week about Junction House and then I promise we’ll be back to regular scheduled programming. Below is a copy of the press release that went out yesterday afternoon. It includes a few more renderings for the project.

    ————————————

    October 11, 2018 (TORONTO) – After unveiling plans for a Studio Gang-designed tower at Yonge and St. Clair earlier in the summer, Slate Asset Management enters the fall market with a new mid-rise condo offering in the Junction. Designed by acclaimed Canadian architects, superkül, and emerging local interior design firm, Dialogue 38, Junction House further solidifies Slate’s approach of leading with design and city building when it comes to residential development.

    “We invest in designers because we believe in design innovation,” says Brandon Donnelly, VP of Development for Slate Asset Management. “For us, good design moves beyond aesthetics and actually solves problems and creates value for people. We want to empower each of our collaborators to come up with bold ideas, as well as think beyond our individual projects and consider the broader community.“

    Sited at 2720 Dundas St W, just as the road begins to bend, Junction House is conceived as a new gateway into one of Toronto’s most vibrant neighbourhoods. The ambitious design brief challenged superkül and Dialogue 38 to define a Canadian brand of minimalism that at the same time reflects the historic material palette and creative energy of the Junction community.

    “One of our inspirations was picking up on Scandinavian and Japanese approaches to minimalism, but through the lens of the Junction. What would that look like? How could we make sure our homegrown brand of minimalism is seen as approachable and in keeping with the neighbourhood?” says Donnelly. “We also really wanted to look at multi-storey suites – which eventually became The House Collection – and explore how we could replicate the single-family experience in a boutique mid-rise format,” he adds, citing the influx of families into the Junction and the need for new residential options in the city more broadly.

    “The building was designed from the inside out,” says Andre D’Elia, Principal at superkül. “We focused on the suites because, ultimately, that is where people are going to live and spend most of their time. We didn’t just design a nine-storey building, we designed 144 homes that occupy the same built form.”

    When it came to the exterior cladding, D’Elia says the focus was on reflecting the immediate context, while elaborating on the details. “We immediately thought of red brick, which is prevalent in the neighbourhood, and ended up cladding the first five storeys of the building with it. In order to add a sense of movement we staggered and angled the brick columns to play with light and shadow. We’re also introducing some old-world brick-coursing to add visual interest and mirror the local context.”

    Dialogue 38 was tapped for the interiors after Donnelly visited a café designed by the firm in the east end of downtown. “Their work is what motivated us to reach out, because it seemed to get the Canadian minimalist sensibility we were after,” explains Donnelly.

    Bennett Lo, Founder of Dialogue 38, says his approach was to focus on delivering design that would last. “We’re all influenced by trends and lifestyle, but our designs need to stand up against time. How do you produce something that is going to have immediate appeal and provide its own kind of interest, without feeling dated in a few years? The idea was to strip the design back and focus on the essentials, while at the same time incorporating aspects of the area. The suites and common areas will have smooth concrete ceilings and warm touches of wood throughout – and the lines are clean and open.”

    The nine-storey building will also feature an expansive lobby that doubles as a co-working space, as well as a gym that draws on the warm materials of the suites and common areas. Lo says the design of the amenity space is optimized to encourage active use. “We focused on the amenities that we know people use, and spent our energy crafting spaces that embody the spirit of the building. The benefit of a boutique mid-rise is the opportunity to extend your living space in to the amenity spaces, and provide moments of social engagement in the building.”

    “We’re a short walk to the UP Express station at Bloor, which can take you downtown in less than 10 minutes. That proximity gives us an opportunity to have a dialogue between the Junction and the rest of the city. The proposed sign marks the Junction’s location and lets you know where you’re going, but also, where you should be,” says Donnelly.

    Junction House offers 1, 2, and 3-bedroom suites, as well as its signature House Collection, ranging from 500 sq. ft. to over 1,500 sq. ft. and starting from the $400s. To register visit: JunctionHouse.ca

    Press Contact:

    Vakis Boutsalis, kg&a

    Vakis@kga-inc.com / 416 537 0954 / 416 578 1741

    About Slate Asset Management L.P.

    Slate Asset Management L.P. is a leading real estate investment platform with over $6.0 billion in assets under management. Slate is a value-oriented manager and a significant sponsor of all of its private and publicly-traded investment vehicles, which are tailored to the unique goals and objectives of its investors. The firm’s careful and selective investment approach creates long-term value with an emphasis on capital preservation and outsized returns. Slate is supported by exceptional people, flexible capital and a proven ability to originate and execute on a wide range of compelling investment opportunities. Visit slateam.com to learn more.

  • Battle of the Bungehuis

    image

    This past July, Soho House Amsterdam opened up in the storied Bungehuis building. Not really news, other than the fact that FT just published this article talking about the building’s history and some of the project’s hurdles, which I of course found interesting.

    Completed in 1934, the Bungehuis originally served as the offices for a prominent trading company. The architect was ADN van Gendt. When he died during the building’s construction, Willem Jacob Klok took over.

    Also noteworthy about the building’s construction is that, according to Wikipedia, twenty houses had to be demolished in order for it to be constructed.

    This underscores a point that I have made before on the blog. Cities are not static. Most of us probably look at the Bungehuis and consider it to be quite a handsome piece of architecture. Some of us may even go so far as to say that we don’t make buildings like they used to.

    Soho House is on record saying that they were “not very budget-conscious” during the renovation because of the sense of responsibility that they felt around the building and its history.

    image

    But I think it’s important to note that this building was initially built for a for-profit company and things had to be demolished in order for it to come to fruition. 

    I can’t say for sure whether this development was opposed in the 1930s, but it may have been. Cities and buildings have a way of ingratiating themselves over time.

    In any event, starting in the 1970s, the building became home to the arts faculty at the University of Amsterdam. And as recent as 2015, it became home to the Bungehuis occupations – a protest occupation started by students and staff of the University who were opposed to a slew of academic cuts.

    image

    Then in a state of poor repair, the building was ultimately sold to Aedes Real Estate, who now leases it to the Soho House Group for their private club and 79 room hotel. Above is a picture of the club’s rooftop pool and lounge.

    The big hurdle, or at least one of them, was the fact that Amsterdam currently has a moratorium on new hotels – as a way to try and mitigate “overtourism” – unless it can be demonstrated that it will represent “an extraordinary addition to the existing stock.”

    Since Soho House Amsterdam opened in July, I guess we know the answer to that test. But it sounds like it may have been a battle. That wouldn’t be a first for this building.

    Images: Soho House Group

  • Create things people love

    I just finished listening to this podcast about venture capital and consumer products. One of the underlying questions is whether we are currently in a “consumer downturn.” Rebecca Kaden of Union Square Ventures (USV) talks about the importance of “platform shifts” for venture returns. These are moments where a new technology hits the marketplace and there’s a corresponding mass consumer adoption. When and where will that next shift occur? Maybe it’ll be in real estate.

    I like the discussions at 10:00 and 13:50. The first deals with the importance of non-paid customer acquisition strategies for consumer products. Rather than relying on bought attention, you really need organic growth strategies, which is often an indication that people are passionate about your product. This is arguably more important when you’re fundamentally reliant on massive growth/scale, but whether we’re talking about software or a home, I still believe it’s paramount. Create things people love.

    The second point is about commerce, Amazon, and how USV avoids investing in companies that are unlikely to ever win against Bezos. Kaden’s position is that Amazon’s advantage is and has been more executional than structural. They are simply really good at doing things better. But Amazon wins at logistics, speed, and value. They are not as focused on experience, entertainment, and discovery. And people still want that.

    I’ll stop there. If you can’t see the podcast below, click here.

    [soundcloud url=”https://api.soundcloud.com/tracks/507691569″ params=”color=#ff5500&auto_play=false&hide_related=false&show_comments=true&show_user=true&show_reposts=false&show_teaser=true&visual=true” width=”100%” height=”300″ iframe=”true” /]

  • Reintroducing Junction House

    Today we released the above rendering for Junction House and announced that sales will begin this fall.

    144 condominium homes. A mix of 1, 2 and 3 bedroom suites, including our Two-Storey House Collection and our Laneway House Collection. Prices starting in the $400s.

    One of our partners also happened to serendipitously send me this Globe & Mail article today talking about the increasing demand for and shortage of mid-rise housing:

    “The market is substantially undersupplied in mid-rise,” said Mr. Hildebrand, who notes that mid-rise projects in the GTA [Greater Toronto Area] were just 31 of 2017’s new launches, accounting for 3,833 units (12 per cent of the total).

    Stephen Price, CEO of Graywood Developments, went on to say this in the article:

    “There’s a huge appetite for medium density in Toronto. Many don’t want to live in the downtown core, this buyer is more interested in being in a community and there is a greater propensity to buy larger more livable units.”

    Given the huge influx of inquiries we received today after the above announcement was made, I would say that feels right. And our focus at Junction House is very much on “larger and more livable.”

    If you’re at all interested in a new home at Junction House, I would encourage you to get on our priority list, here.

  • The rise of proptech

    A friend of mine flipped me this New York Times article today talking about the rapidly growing interest in proptech and about Opendoor – a topic and a company that I have written about many times before on the blog.

    Here’s a snippet about proptech:

    The hauls are part of a race by investors to pour money into technology for real estate, or what Silicon Valley now calls proptech. Having watched tech start-ups upend old-line industries like taxis and hotels, venture capitalists are casting about for the next area to be infused with software and data. Many have homed in on real estate as a big opportunity because parts of the industry — like pricing, mortgages and building management — have been slow to adopt software that could make business more efficient.

    On the Opendoor front, which is the largest/most valuable company in the proptech category, they have now raised over $1 billion. By the end of this year they plan to be in 22 cities across the United States.

    Interestingly enough, they have started experimenting with other business models, beyond just buying and flipping homes. They now circumvent agents and sell some homes directly to customers.

    But Eric Wu, the CEO of Opendoor, believes that you can’t automate proper advice and so that will remain. The role of agents is simply about to shift from “administration” to that of “advisory”.

    I have been arguing for years that the home buying and selling process is ripe for change. And what we are seeing today is really the start of that.

    According to the NY Times, real estate tech startups raised $3.4 billion in funding last year. Some firms, such as Fifth Wall Ventures, are entirely dedicated to the space.

    This is money betting on change.

    Photo by Grant Lemons on Unsplash

  • Introducing Stephen Avenue Place

    Today, the Slate Canadian Real Estate Opportunity Fund I announced a new name for its 40 storey tower at 700 2nd Street in Calgary: Stephen Avenue Place

    It also announced that it has partnered with Oliver & Bonacini Hospitality and Concorde Entertainment Group to create three new dining destinations at the property: a top floor restaurant, a food hall, and a high-energy restaurant/bar/patio at street level.

    Here are a couple of excerpts from today’s press release:

    Stephen Avenue Place offers 620,000 square feet of rentable space at the nexus of the historic Stephen Avenue Walk and 2nd St. This classic of the Calgary skyline will undergo a significant renovation – from its public-access ground floor to exclusive tenant amenities and top-floor restaurant – that will reposition it as a modern hub for energy, innovation, business, dining and shopping.

    The acquisition and renovation of Stephen Avenue Place is part of Slate’s growing investment in Calgary. In the past 18 months, Slate has increased its footprint in Calgary to 2.3 million square feet with the purchase of 21 office properties, including 12 downtown.

    “We are thrilled to acquire and develop such a high-quality property in downtown Calgary that offers businesses, diners and shoppers the very best in location, amenities and access,” said Slate founding partner Blair Welch. “Stephen Avenue Place will undergo an extensive renovation to fully reflect the way we work and live now, while respecting and celebrating its history and future as a Calgary landmark.”

    For the full press release, click here. And to learn more about Stephen Avenue Place, including leasing opportunities, click here.

    Disclosure: As many of you already know, I work for Slate Asset Management L.P. I am responsible for the company’s ground-up development efforts.

  • Rules are meant to be broken

    Things are busy right now as we get ready to unveil Junction House this fall and so I’m a bit behind on my news and reading. 

    I just finished reading Alex Bozikovic’s Globe article on BIG’s new KING Toronto project (official name). It is an interesting piece about creating villages and a sense of community in new developments – something that Bjarke Ingels has been focused on for many years. 

    Below are a few renderings of the project. I’m excited for this one. And as I said before on the blog, I am sure it will be precedent setting in a number of ways.

    One remark from the article that stood out for me is this one here:

    Still: The design breaks a lot of rules. Which is why it took two years of difficult negotiations with city planners to reach approvals. “We wanted it to be quieter,” says Lynda MacDonald, a senior Toronto planner who was involved in overseeing the project. “It’s a very large project, and we wanted to make sure it respected the character of King Street.”

    I am often asked why we don’t see more innovation in architecture and real estate. There are a number of reasons for that. One of them is risk. Development is in many ways a game of risk mitigation. 

    But another reason is that when you try and do something unconventional that disrupts the status quo, you also call into question the typical planning criteria used to evaluate projects. And that may slow you down.

    Alex accurately points out in his article that we are used to doing things around here in one of two ways:

    The King Street project is also an ambitious experiment with urban design. There are basically two species of tower in Toronto: a midrise slab of six to 10 storeys, which steps back at the top; and a “tower-and-podium,” a model borrowed from Vancouver that combines a fat, squared-off base (or “podium”) with a tall, skinny residential tower. Both can work, but can also create the big-box blandness that many people dislike about new urban housing.

    None of this is to suggest that we should ignore the character of a particular area. It is critical and I believe that KING Toronto has been mindful of that. 

    But I also firmly believe in ambitious city building and I think there’s no question that KING Toronto is doing exactly that.

    Images: Hayes Davison via Dezeen and courtesy of Westbank