Brandon Donnelly — Daily insights for city builders. Published since 2013 by Toronto-based real estate developer Brandon Donnelly. — Page 198

A friend recently asked me, "so, are you bullish on Miami yet, or are you still worried about the water?" And my response was that I love Miami , but that I do think about the risk of climate change.

Then today, another friend sent me this study by scientists at the University of Miami showing that 35 buildings along the Miami Beach to Sunny Isles Beach coastline experienced some degree of subsidence between 2016 to 2023. In other words, they sunk into the ground a little.

Here's how they measured this:

The study published December 13, 2024, in the open-access journal Earth and Space Science, of the American Geophysical Union, employed a satellite-based technique known as Interferometric Synthetic Aperture Radar (InSAR). By combining 222 SAR images from the European Sentinel-1 satellites, the research team created a surface displacement time series. The technique utilizes "persistent radar scatterers" as reference points for measurement. These scatterers include fixed elements on a structure such as building balconies, rooftop air conditioning units, and boardwalks, which reflect the radar signal back to the satellite antenna. Satellites flying at 700 kilometers above Earth can measure millimeter-scale displacements.

Now, some degree of subsidence is normal. But apparently, not this much:

“The discovery of the extent of subsidence hotspots along the South Florida coastline was unexpected,” said Farzaneh Aziz Zanjani, the study’s lead author, a former post-doctoral researcher and alumna of the Rosenstiel School. “The study underscores the need for ongoing monitoring and a deeper understanding of the long-term implications for these structures.”

So yeah, I'm still worried about the water. It's something I would need to get a lot smarter on in order to feel comfortable.

This year, 88 companies delisted or transferred their primary listing away from the London Stock Exchange. Only 18 new companies listed. This, according to FT , marks the biggest net outflow of companies since the financial crisis.

A lot of these companies are, of course, moving their listings over to the US. The New York Stock Exchange and the Nasdaq are, by far, the two largest stock exchanges in the world by market cap. And so many companies believe that they'll generally have a better time being listed over there -- better access to capital, greater liquidity, etc.

This is not a new trend. Last year, the FT also called out the London Stock Exchange as being the European stock exchange with the greatest risk of seeing companies depart for the US. Here's what's been happening since the financial crisis:

Some people may not think that this is a big deal, but it certainly undermines London's position as a pre-eminent global center. Most rankings of the world's best or most global cities have London and New York out front. But from an economic prosperity standpoint, the US hegemony is real and feels even stronger right now.

Naturally, this decline will also trickle through other parts of the economy. On the real estate side, prime central London is seeing the biggest buyer's market since the financial crisis. (Presumably this is true of other submarkets as well.) On the new construction side, sales and starts are falling, and unsold homes sitting as developer inventory are increasing:

It is tempting to say that London will always be London. But :

“The UK market does not have any god-given right to be a leading listing venue, [but] it requires nurturing and support to be successful in a market that is increasingly global,” said Hall, adding that “more companies will depart” unless action is taken.

This is true of every city and every industry. There are no guarantees. Cities need to compete, just as companies compete. I am also of the opinion that Brexit has and will continue to be a drag on the UK economy. Disclaimer: I'm not an economist. But the UK is a relatively small country. So intuitively, I would think that the way to compete with the scale and dominance of the US is through a more unified Europe.

Are you bullish or bearish on London right now?

Last year, Pew Research Center asked over 5,000 adult Americans whether they would rather (1) live in a community with smaller houses that are within walking distance of schools, stores, and restaurants, or (2) live in a community with larger houses, but where schools, stores, and restaurants are several miles away . The result:

On average, most respondents preferred the latter option -- the larger home. However, there are some demographic groups that feel differently. If you're young (under 29), highly-educated, Democratic-leaning, and/or Asian, this survey suggests that you have a preference for smaller houses in more walkable communities.

More specifically, in this chart, it's interesting to note that 62% of Asians (survey only counted English speakers), 55% of those aged 18-29, 54% of those with a post-graduate degree, and 65% of liberal Democrats prefer denser places that allow you to walk to more places.

A lot of this isn't surprising, but I don't think I've seen data supporting such a strong leaning from Asian adults before. What makes this even more interesting is that White and Asian households are by far the two richest ethnic groups in America . And here, when it comes to built form preferences, they're on opposite ends of the spectrum.

Another important consideration is the cost of living in walkable versus car-oriented communities. Generally speaking, the latter is less expensive on a cost per square foot basis for homeowners; though, this obviously doesn't include the indirect costs of transportation and the additional time it to takes to commute places.

It is also more expensive to service and bring infrastructure to more spread-out communities. There are real economies to density . Despite this, higher-density living tends to be more expensive. Part of this has to do with higher build costs and more restrictive zoning, but it could also be a scarcity of supply (most of the US is car-oriented).

Indeed, there is a well-established premium to living in walkable communities, which creates an interesting dynamic. The thing that the majority of people reportedly don't want or don't prefer is actually more expensive. This always makes me wonder: What if this wasn't the case? What would happen if we didn't have this cost-of-living differential?

Charts from Pew Research Center ; cover photo by Dmitry Tomashek on Unsplash