Brandon Donnelly — Daily insights for city builders. Published since 2013 by Toronto-based real estate developer Brandon Donnelly. — Page 1404

Welcome to 2015!

To start off the year, I thought I would talk about something pretty geeky, but very forward looking: Bitcoin.

I wrote about Bitcoin just over a year ago when I was first starting to wrap my head around it, but a lot has happened since then. Many of you might know that 2014 was a terrible year for Bitcoin and that its price has declined significantly ( chart from Coinbase ):

But does that mean Bitcoin is a flop, or that the hype has just died down a bit?

If you follow what’s being discussed within the tech community, you’ll know that there are still lots of people who are bullish on Bitcoin. But more precisely, they are bullish on the underlying architecture behind Bitcoin and something that is called the Blockchain .

I’m not going to get too technical in this post (if you want that, go here ), but I do want to talk about three things (that I’ve mostly learned from the folks over at Union Square Ventures ): the Blockchain, why it matters, and what it could mean for specific industries such as transportation and real estate. I promise to make it relevant at the end.

The way to think about all of this is in layers.

The Blockchain is the foundation or base of Bitcoin. It’s essentially a decentralized public ledger that keeps track of all the Bitcoin transactions. Decentralized means that not one single person or company owns the database. It’s free for anyone and everyone to see. This structure is important because it enables peer-to-peer transactions across the internet, as opposed to going through a bank or other intermediary.

But the key takeaway is that Bitcoin is simply one example of a “protocol” built on top of the Blockchain. And there are many others in the works, including a protocol for realtime ride sharing ( Lazooz ) and a protocol for a decentralized peer-to-peer marketplace ( OpenBazaar ). And so the real innovation is the Blockchain, not Bitcoin itself.

Why does this matter?

It matters because these protocols are, again, not owned by a single entity, which is remarkably different than the way most things work today. Take for example the residential real estate industry. In the Greater Toronto Area, the data that emerges from home listings and sales is owned by the Toronto Real Estate Board.

And since this data is privately owned, a lot of it remains only accessible to “members” or real estate agents. The Competition Bureau has been fighting for more openness , but the Toronto Real Estate Board obviously wants to keep as much of this data as it can to itself. Who can blame them.

But what if somebody came along and created a new protocol for a decentralized peer-to-peer home marketplace? In that case no one would own the data, which means everyone would have access to it. And that would completely change the landscape. I’m fuzzy on what this protocol would even look like, but it seems entirely possible given what else is in the works.

And if this Bitcoin Blockchain revolution does actually take place, it wouldn’t be restricted to only non-tech legacy industries. Joel Monegro of Union Square Ventures believes that “decentralized protocols” such as Lazooz and OpenBazaar (mentioned above) could even have a big impact on companies such as Uber and eBay, respectively.

I’m still trying to wrap my head around all of this, but I want to understand it and I thought you all might as well. Because even though it seems very tech right now, the implications would also be very non-tech if it turns out to be true.

Today is the last day of 2014.

It felt like a frenetic year for me, and so I have to say that I’ve been really enjoying this holiday break. I needed the downtime. I needed the time to think and strategize. And I got all of that this holiday. (The only thing that would make this break even better would be some more snow on the mountains.)

I’m super excited for the new year and what’s ahead, but before getting into that, I thought it would be worthwhile to look back at what happened in 2014.

I was initially going to list out some of my thoughts, but then I figured that a better way would be to simply list out the most read Architect This City posts. That way it’s my (daily) thoughts, but curated according to what readers cared about most this past year.

Click here for the top 15 most read Architect This City posts of 2014 . I’ve listed them on a “topics” page that I plan to update every year.

If you’re looking for some other 2014 themed reading material, I recommend also checking out the best #cityreads of 2014 by CityLab ; the best articles of 2014 from ArchDaily ; and what just happened? by venture capitalist Fred Wilson.

Happy new year everyone! Thanks for reading. See you in 2015.

Image: Family and friends lunch at Pizzeria Libretto, University

I continue to be amazed by the unmet demand for real estate (development) education here in Canada.

Following yesterday’s post on the real estate development process , I received a few emails from readers asking about the best university programs (MBA, MRED, etc.) and the best approaches for becoming a developer.

I also had a good conversation on Twitter, which covered off some details that I had left out from my post (for simplicity) and which resulted in me suggesting that a real estate development school needs to be started here in Toronto:

@donnelly_b I’m game. The Donnelly-Hassan Institute for the Dark Arts.

— SymmetryDevelopments (@symmetrydevelop)

December 30, 2014

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@symmetrydevelop @donnelly_b would be your first student. damn! could’ve stayed in Toronto if there was a program.

— Kuok-Kei Hong (@KuokKei)

December 30, 2014

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Now, part of the reason things are the way that they are, I think, is because the real estate industry has been historically dominated by private rich families. People didn’t go to school to learn how to be developers. They learned by doing and that was then passed down to the next generation. All it took was chutzpah.

But as the real estate industry continues to institutionalize and become run by pension funds and large publicly traded companies, I think the point of entry will also become increasingly institutionalized. And that’s where dedicated real estate programs will continue to come in. 

I’ve spoken to a few people at the Rotman School – where I did my MBA – and there doesn’t seem to be a huge interest in a dedicated program such as a Master of Real Estate Development (they already offer real estate courses). It’s more of a “longer term” strategy. 

But I think that’s a mistake.

I’m confident there’s strong demand from the student side, so hopefully a wealthy donor will step forward to help make this happen. The University of Toronto has both a great business school and a great architecture school. That feels like a great recipe for a first-in-kind joint degree offering.

Image: Urban Learning (via Flickr )