Brandon Donnelly — Daily insights for city builders. Published since 2013 by Toronto-based real estate developer Brandon Donnelly. — Page 1288

Last week was developer Urban Capital’s 5th annual “Naughty or Nice” party. It’s obviously a holiday tradition of theirs and it has become a tradition of mine to attend. Judging by my vast collection of photo booth photos, there’s a chance I may have been to all of them. It’s easily one of the best holiday parties in the business.

One of the things that Urban Capital does at its annual party is release its annual magazine. And this year I was fortunate enough to be invited to write a piece for it on the highs and lows of mid-rise development. Put differently, it’s about the challenges facing developers who want to build mid-rise, but also why they’re pretty great for cities.

If you’d like to have a read, you can do that online by clicking here . And if you’d like to receive a hard copy of the magazine, I can make that happen as well. Tweet at me . Alternatively, you can also pick up the magazine at any Urban Capital sales office.

I deliberately tried to make it so it wasn’t your typical real estate puff piece: condos are great, yada, yada, you should buy one from us. I tried to make it an intelligent piece on some of the real challenges facing mid-rise developers. And that’s what Urban Capital wanted as well. I hope you enjoy it :)

https://500px.com/embed.js

When I was in Miami at the beginning of this month I missed an interesting event that I normally would have attended. It was a conversation between the Chief Planner of Toronto, Jennifer Keesmaat, and the former commissioner of the New York City Department of Transportation, Janette Sadik-Khan .

Sadik-Khan was appointed under the Bloomberg administration and quite famously oversaw a huge number of urban changes in New York. Projects such as the addition of hundreds of kilometers of new bike lanes and the creation of 60 new pedestrian plazas across the city – including the one in Times Square.

I was bummed I couldn’t attend, but thankfully  Keesmaat wrote a post on her blog following the event and the Metcalf Foundation shared videos of the conversation. 

Here’s a piece that I liked from Keesmaat’s blog post:

“But she also pointed out that when they demonstrated what could be done, when they quickly mobilized around action, residents clamoured for similar changes in their neighbourhoods. Not surprisingly, this is why her book is called Streetfight – because it is a fight. City building is often the battle of ideologies, and when you’re trying to change the status quo, there is always a significant demographic of the population that is fully committed to maintaining business-as-usual.”

If you have some time, you can also click here to watch the videos. There’s about an hour and a half worth of video, so you might want to open up a bottle of wine or something.

One aspect of the Toronto housing market that I’ve been paying close attention to is the adoption of multi-family dwellings by both long-term end-users and families. 

I’ve written about this before ( here and here , over a year ago) and have argued that here in Toronto we are at an inflection point. Multi-family dwellings – both rental and condo – are evolving to now target these new customer segments. Whereas previously, the new construction multi-family housing market was heavily geared towards investors and first-buyers. And often it was simply a stepping stone towards a single family home.

Now, every city and real estate market is different. And I have heard many people in U.S. cities say that Millennials are simply deferring what we saw with previous generations. At the end of the day they (or we, I’m a Millennial) are going to move to the suburbs and buy that car. The current trends we are seeing around city living and reduced driving are just that – short-term current trends.

But I think it’s worth reiterating: I do not believe that the status quo is what’s happening right now in Toronto. And I’m sure it’s also happening elsewhere. Time and time again I speak to developers in this city who are starting to shift at least some, and in some cases all, of their focus towards end-users, families, and larger units – particularly for new mid-rise product in the “neighborhoods.”

And if you think about it, this makes perfect sense. 

The average price of a detached single family house in Toronto is well north of a million dollars. So when a developer brings to market a 1,200 sf family sized apartment at $600 psf ($720,000) or even at $700 psf ($840,000), that home now becomes a relatively “affordable” option in many desirable areas of the city. Particularly if you value location amenities and your time (i.e. shorter commutes) over raw quantity of space. I know I certainly do.

I know this isn’t going to appeal to everyone. But there is a big market here. Get ready.

What are you seeing in your city? Let us know in the comment section below.