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How much of an impact does zoning/planning have on housing costs and development?

Memph

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For all the talk of a housing bubble and housing in Toronto being unaffordable, one of the things I find odd is the type of housing that gets built in response.

The two most common types of housing being built right now are:

Highrise condo. Usually small units of 400-800sf, most commonly in downtown but with a significant amount being built elsewhere too. The combination of the need for big underground garages, and highrise construction being inherently more expensive than lowrise means this type of housing usually costs at least $400/sf, often up to around $600/sf. For a single yuppy that doesn't have anyone else to support, this makes a small 1 bed manageable, barely, or at least sometimes... but that's more or less it. For a family, which needs more space, it's really pushing it.

Large suburban house. The average single family home being built nowadays might be around 2500sf, and then have garage and basement space on top of that. Obviously that's going to be expensive, there's no way around it, so usually they're $600,000+ in the GTA. Smaller houses, semis and towns might be around 1500-2000sf (not including basement/garage), and be around $400-500,000. But even 1500sf is not that small.

I would say that for an average family making $70,000, they can afford maybe a little over $200,000. Clearly there seems to be a mismatch... Even in these newly built suburban areas, where incomes are higher, the homes are about 5x the average household income.

You would expect that more affordable forms of housing, small modest houses, townhouses and lowrise apartments, mostly in the 500-1500sf range would be getting built in greater quantities, catering to retirees and empty nesters, families and young singles. I would think that it should be possible to build this kind of housing and sell for around $150,000-$350,000, depending on the size and location, but it isn't happening.

First of all, the $50,000 development charges some suburbs have for new SFH are pretty surprising and definitely add to costs. I believe you have to provide evidence that the impact is in fact that high to charge so much. Go to places outside the GTA and the charges are much lower, in Waterloo, I think it's around a quarter of that. Is it just a matter of other cities subsidizing new development, or are the impacts that much higher in the GTA?

Anyways, I think there's two main reasons why the housing being built is more "luxury" than you'd expect. First, there's few places where you can build multi-family, especially in the city. There's "stable neighbourhoods" where zoning prevents it from being built, limitting multifamily to just expensive to remediate brownfield sites, and a limitted number of other sites, mainly on commercial streets and in downtowns/centres. Because these sites are limitted, and there's so much demand to live in Toronto, the response ends up being to build tall.

In the suburbs, there's quite a bit of new infrastructure that needs to be provided. This includes both infrastructure built within the subdivision, and outside (covered by development charges). I would think one cause is the relatively low densities and high car use requiring lots of space and infrastructure. There's also the fact that streets have to have a 50-60ft ROW, with ~30ft of pavement for one lane in each direction plus required space for on street parking on both sides. This is despite every house being required to have off street parking and curb cuts making easily half of the added street width for on street parking unusable. You also have underground storm sewers, instead of the ditches you see in some older suburban neighbourhoods, and of course sidewalks. Then there's the cost of providing all that required off-street parking, and land that gets consumed by front setbacks, much of which just ends up being driveways rather than yards. With all this pavement, you also need more high capacity storm sewers, and storm water ponds. You'll also need a lot of space dedicated to parks to make up for the rest of the public realm, and also because despite low densities, everyone still wants a park within walking distance.

If you're going to consume so much land per capita on setbacks, ROWs, parks and storm water ponds, and spend the money building these, plus the driveways, garages and storm sewers, the developer is going to have to make up the money somehow, and it's not going to be by building little 2 bedroom houses on 1000sf lots. Much better to built 5 bedroom houses on 4000sf lots and selling them for an accordingly higher price. And from the point of view of the home buyer, it makes sense too. If you're going to have to spend $200,000 per house on all that land and infrastructure, you're going to want more than a 1000sf house, you're going to want a big house with all the trappings. Also because the public realm sucks, you don't want to be too close to it (setbacks) and have a nice retreat (big house, backyard).

If you look at London, which also has a housing affordability problem, one that's even greater than Toronto's, they are responding rather differently. The affordability problem there is largely caused by a major lack of new supply, despite rapid population growth. The response is to subdivide housing into smaller units, convert carriage houses and backyard sheds to new units, and the new suburban housing outside the greenbelt... is actually pretty modest, mostly 1000-1500sf. This seems like more of the kind of response you would expect to high prices (aside from upzoning).

So what if things were done different? If streets were designed as shared space and narrower, much narrower (ie 20ft ROWs). If you didn't require on street parking, but rather just small community parking areas for that one time when you have a party and 2 off street spots aren't enough. If front setbacks weren't required?

How radical would the change be in terms of what new greenfield development would look like?

Would it look more like this?
http://goo.gl/maps/Jd9OQ
Or have an element of this?
http://goo.gl/maps/c3qPw

I think there's a general rule among developers, that the value of the house has to be a certain number of times the value of the land and infrastructure associated with it. If you decrease the later, it will become viable to decrease the former. Would we see a lot more modest greenfield housing?

And what if lowrise infill was allowed to be built throughout the city of Toronto, and with more lenient parking requirements? How much would that affect the type, cost and quantity of infill being built?



As for why 1920s-1960s housing being more modest... I think they didn't need as much regional infrastructure. Part of it was that the city was smaller, so people weren't going to commute 10-20km like they often do in new developments. Infrastructure might have been more subsidized too. And people weren't as wealthy of course, plus land was probably cheaper since the automobile had just opened up tons of land previously considered too remote. And you did have at least some neighbourhoods that had "lighter" infrastructure
http://goo.gl/maps/Lz2eR
 
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I was looking at the Toronto zoning code... I expected that it was probably going to be quite restrictive but I didn't think it was going to be this bad.

It looks like these SFH lots are still zoned for SFH detached only? They're between Sheppard W and the condos going up near Bayview Station.
https://www.google.ca/maps/@43.7667...ata=!3m4!1e1!3m2!1sORnLicjwN_kwz9arURz0Bg!2e0

Much of Bathurst, Dufferin, Ossington, Harbord is zoned residential. Basically the only lots where you can create commercial uses are lots that already have commercial uses. That goes for the whole city it seems. Like the stretch of Sheppard West that's urbanizing still has sections that look like they don't allow commercial. I think neighbourhoods like Jane-Finch would benefit from allowing retail on apartment and even single family/semi-detached properties rather than just in existing strip malls. So basically 2-3 mall owners get to control the retail of a neighbourhood of tens of thousands. If you want to build your own retail space tailored to your needs there, then too bad. And I'm guessing that the parking requirements prevent the mall owners from developing under utilized park (the part of the Jane-Finch Mall parking area near the J-F intersection seems underutilized).

Of course small scale light industrial uses are limited only to existing industrial areas.

Multi family seems to be limited also to just areas that are already multifamily (or commercial, I guess I should at least be grateful that you can build mixed use on just about all existing commercial properties).
 
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Reading The Death and Life I think it supports my views, especially regarding "stable residential neighbourhoods" designed for stasis.

Most would agree that Kensington Market is one of Toronto's most interesting neighbourhoods. I think there's a few reasons for this.

1) Relatively high abundance of land zoned to allow retail like Augusta, Kensington and Baldwin, in close proximity to other streets that allow retail (Spadina, College, Dundas) means there isn't really a lack of potential spots to start a business, allowing for a wide variety of independent businesses.

2) Having a lot of buildings that are not new also helps contribute to relatively inexpensive rents. I say not new rather than old or historic, because I include not just the Victorians but also the small modernist buildings from the mid 20th century that are quite abundant here and I would say actually play a more significant role than the Victorians. Pretty much everything more than 50 years old will probably have relatively inexpensive rents, and even 25-50 years old should be a fair bit less expensive than rents in a brand new building.

3) Retail spaces can more easily be customized. Since the buildings are small, the retail space will be a more significant component, and the building owner will be more likely to work with the business the tailor the retail space to their needs, put up unique signage etc. Especially if the business owner and building owner are the same person, which is more likely with small buildings that could be purchased by small businesses. With large buildings, concerns over how it will affect the residents and the value of their units are more likely to dominate. I'm not sure how retail in condos works, do you have to deal with the condo board? That would be especially complicated.

4) Buildings with narrow frontages make for a diverse streetscapes

5) Fluid interface between shops and sidewalks. What I mean by this is open air display of products (like all the fruit stands) and restaurant/cafe patios mostly. This has two main advantages, first it increases the visibility of the products/services sold by the business, but also it increases vibrancy, both by just having products displayed, and because you'll get people stopping at the food stands and sitting at the patio tables visible to people walking on the street. Also not just visible but audible and smell-able too.

I'm not entirely sure why so few commercial areas are like this, but I have a few theories. First, maybe zoning/regulation related? Second, maybe the setbacks the original buildings had contributes to making space for these sorts of activities (since they're not allowed on the sidewalk). If you look at old pictures of cities (namely Lower East Side) they were often similar, but either had the display of goods on the sidewalks, which were wider, or from vendor carts on the street next to the sidewalk. And if that left insufficient space to accommodate pedestrians on the sidewalk, they could just walk on the street since there weren't many cars. Also, I think it might partly be related to the greater flexibility businesses get with small buildings - see 3).

6) Narrow streets. First, the streets of Kensington get little traffic, and because they're narrow, and also because of the bustling nature, you get great traffic calming, so less noise and more of a feeling of safety for pedestrians and also bicyclists. Not just that, but it's also very easy to cross the street wherever you want, which is very important for commercial streets. Notice an interesting shop display on the other side of the street? Well then just go ahead, cross right where you are and check it out. If you have to go to the next intersection, wait for the pedestrian signal and come back, odds are you won't bother, because you weren't really sure if what you saw is that interesting... especially if the street was wide and it was hard to see the other side from your side. Which is another advantage of narrower streets, you can not only make out people better but retail displays too. In places like Kensington, you can even walk in the middle of the street a lot of the time, which I sometimes like to do since you can see the buildings on both sides better without having to crane your neck (if you're walking next to a building (ie on the sidewalk next to it) you can only see the ground floor really, often even the sign is a bit high).
 
Now for how I think infill can create more Kensingtons, but how the current way infill is done may cause Toronto to head in the opposite direction.

First of all, density is important. The moderate densities you see in streetcar suburbs are often enough to support the basics within walking distance, but just the basics can be a little boring. If you have the density to support not just the basics but all the extras, from big department stores to small specialty stores, I think that's so much better and this is what I think makes for a great city.

It's been mentioned on UT (and elsewhere) that Toronto is not that interesting for people coming from cities like New York, Chicago, Boston, San Francisco, Berlin, Paris, etc and that even Montreal is more interesting. Although there's not much that can be done to get architecture (especially historic) and the great museums that come from a period wealthy cities for centuries. However, if Toronto can get denser and more diverse, with dozens of Kensingtons and Yorkvilles throughout the core, connected by high quality transit, while it might still be behind New York and Paris, I think it can certainly rival Montreal, San Francisco and Boston.

I would say that most of the downtown adjacent neighbourhoods are not dense enough for this. Neighbourhoods like Dovercourt Park and Cabbagetown, and even Little Italy, Seaton Village and The Annex, while they have densities relatively similar to Kensington Market, have quite a bit less retail. They have enough to be walkable neighbourhoods, but they're not on the same level as Kensington Market.

However, there is a downside with how we're doing intensification. It's mainly concentrated in a few small areas, which means low supply of infill land combined with high demand = very high density buildings, ie highrise condos, which are not very likely to host small independent businesses (for the reasons listed above). Plus it's likely that virtually all the land zoned to allow redevelopment will be redeveloped, leaving few smaller older buildings that could potentially accommodate small independent retail. This goes not just for downtown development but the Avenues too. While the buildings on the Avenues are supposed to be midrise rather than highrise, for these purposes, a new 150 unit 8 storey condo building with 150ft+ of street frontage has all the drawbacks for vibrant streets with small independent retail that highrise condos do.

Either way, the kind of retail you'll get is mostly the starbucks-LCBO-big 5 bank-loblaws/metro/sobeys-subway-dry cleaners-nail salon combo. Having these sorts of businesses is fine and can add to a neighbourhood, but you should still have a place for independent businesses too.

The other part of the problem is retail is zoned out of currently residential areas. When Bloor street got more expensive with the subway, a lot of the smaller independent shops moved to Yorkville and Cumberland streets, which I'm pretty sure were previously mostly residential. But now, this kind of "spilling over" can't really happen. Like not anywhere at all.

So basically, the problem is retail is only permitted in a limited number of places, and intensification is also only allowed in the same limited number of places. I think either retail should be allowed to spread to more areas, or infill should be allowed to spread to more areas, or both.
 
As for how the intensification would occur.

You don't want to see neighbourhoods get obliterated by a sea of blockbusting highrises, that's perfectly understandable and there are alternatives.

You can designate architectural significant properties as heritage or something equivalent, as long as there are tax deductions.

You can avoid upzoning certain neighbourhoods like The Annex with very high concentrations of attractive and unique homes, although you should still be able to allow backyard/laneway housing.

You can limit residential intensification to just small portions of a neighbourhood, but allow retail is more widespread sections.

That's mostly for neighbourhoods with architecturally significant buildings. There are neighbourhoods that are still on a street grid, like Willowdale, Glen Park, Keelesdale, East York, Birch Cliff, New Toronto, The Junction, even parts of Little Portugal where it's mostly modest plain looking homes (or new suburban style homes). I would say this applies to easily half of street-grid Toronto.

In those cases, you can have height limits to avoid out of scale buildings and discourage blockbusting lot consolidation, keeping new developments to the size of just 1-3 lots for the most part. For example, you could say that a building cannot be more than 50% taller than the average height of the adjacent buildings. That would allow intensification to continue indefinitely without ever being too out of scale.

And regarding blockbusting, you can't build a highrise on much less than 1/4 acre especially if it is to have underground parking. If you're looking to build a highrise in a lowrise neighbourhood, you might look for a house for sale, and buy it for market price, and then knock on neighbours doors and offer to buy their homes at a premium. That premium will probably be a drop in the bucket compared to other costs. Say you buy six 1/20 acre houses for $800k for the market rate one and $1.1m for the other five. Lets say you build a 30 storey 15 FSI tower, at $300/sf for construction, development charges, marketing and financing costs (is that realistic? I'm getting this value mostly from back-calculating), that's $59million compared to $6.3 million for the properties including $1.5 million for the premium portion. The premium is a drop in the bucket, to the tune of 2-3% of total costs.

Now if you went lowrise (4-5 storeys), say 2.5 FSI, would it be viable to consolidate? If you do, lets say it's again $6.3 million for the 6 lots, then the other costs are maybe $175/sf since lowrise construction is less expensive. So $5.72 million in construction costs, $12.02 million total, with the "premium" being 10-15% of total costs so there's a much stronger incentive to consolidate no more than absolutely necessary, even if it means the cost of construction is a bit higher.

You can also have form based codes guiding things like setbacks. A few simple rules could even lead to the complex network of courtyards you see in certain cities like Paris. Like "you can't build within 10ft of a window of a neighbouring building and you can't build a window facing a side/rear lot line within 5 ft of those lot lines". Maybe increase those to higher values (10ft and 15ft? 10ft and 20ft?) for neighbourhoods that have a more low density/suburban character. Maybe have rules that allow neighbours to get compensation for shadowing and such.

Also I think parking requirements in downtown areas should be abolished since on-street parking is already a small part of the supply and should probably just be metered to address shortages. Or at least the requirements should be reduced and unbundled. So right now I think demand is around 0.3-0.5 spots per unit, but buildings have been built with 1 spot per unit, so maybe an adjacent building could be built with 0 spots if it buys parking spots in an adjacent building that has more of an oversupply. And while neighbourhoods like Beaconsfield Village or The Danforth might need some new off-street parking built, as they become denser and transit improves (DRL?), parking requirements can be reduced, and you can have the initial new buildings sell parking rights to the later new buildings. Or maybe you can have a large brownfield/greyfield redevelopment site with space for a big parking garage sell parking spots to developments on small sites that have less space.
 
Now for pictures of what kind of infill I have in mind.

First of all, I think infill should happen not just in downtown adjacent neighbourhoods but throughout most of the 416. Scarborough, North York and Etobicoke are increasingly home to pockets of poverty, so they would benefit from more density to support better transit and amenities within walking distance, even in places like Rexdale, West Hill, Eringate, Jane-Finch or Highland Creek. Trinity Bellwoods can become more like the Plateau Mont-Royal, Old East York more like Trinity Bellwoods, Birchcliff more like Old East York, Dorset Park and Downsview more like Birch Cliff, etc.

Lets start with buildings with side setbacks, which would fit in well in neighbourhoods that are currently mostly detached SFH.

So you can have something like this, I call them "mansion apartments". They contain multiple apartments, but look like a mansion, so they would fit in in places where a lot of mansions are being built like Glen Park or Central Etobicoke, or in places like Downsview where unlike Glen Park, there's little demand for 6000 sf mansions, but there might be demand for small to mid-sized apartments, but not at the high construction cost of highrises. They're very common in Los Angeles.
IMAG1246.jpg

http://momentumrg.com/property/2520-5th-ave-los-angeles-ca-90018/

Toronto has a few "mansion apartments" too, as does Montreal, like these in Cote-des-Neiges
https://www.google.ca/maps/@45.4948...ata=!3m4!1e1!3m2!1s6CweSsiPXYvgg_O1D87fVg!2e0

You can also have semi detached homes on larger bungalow lots. There is strong demand for ground related single family homes in central locations, and since you can't create more land, you can always take larger lots and turn them into smaller lots. So again, as an alternative to the 4000-6000 sf mansions being built in Glen Park, Bathurst Manor, Willowdale and Ledbury Park for the wealthy, you could also build narrower 3000sf homes like these in Calgary. The phenomenon of taking larger bungalow lots and subdividing them into semi-detached and townhouse lots is very common in Calgary but strangely almost non-existent in Toronto. It would provide more housing for the upper middle class as an alternative to just pricing out the middle and lower middle class from the Junction, Little Portugal, Corso Italia, Old East York, etc.
south_calgary_real_estate.jpg

http://www.justinhavre.com/blog/jus...-stunning-3-storey-home-in-south-calgary.html

You can have small apartments like the ones all over Toronto's streetcar suburbs from the mid-20th century.
sold-triplex-for-sale-toronto-ontario-big-2710012.jpg

http://comfree.com/triplex-for-sale-toronto-ontario-378233

Or maybe something with balconies might be nicer
BeachApartment.jpg

http://www.torontorealtyblog.com/archives/converting-a-multi-plex-back-to-single-family/8676

You have the Vancouver Specials...
36516.jpg

http://www.jefffitzpatrick.com/Blog.php/the-vancouver-special

Chicago has loads of 2-4 unit walkups
DSC07443.JPG

http://www.ericrojasblog.com/2010/03/deal-of-week-majestic-ravenswood-three.html

New England's equivalent would be the triple deckers
Building_brown_and_blue_tri_tcm3-31351.jpg

http://www.cityofboston.gov/3D/gallery.asp

More detached plexes from Montreal
https://www.google.ca/maps/@45.5558...ata=!3m4!1e1!3m2!1sTu-uwCk3QiwnShcXZErdPA!2e0

You've also got semi detached duplexes like these in Montreal.
https://www.google.ca/maps/@45.4848...ata=!3m4!1e1!3m2!1s5yOEESyCghovJpc_Sna06Q!2e0

In Seattle, you have four-packs, a pair of semi detached homes in front, and another pair at the back of the lot, with a driveway in between.
145964917_4eadc72f79_z.jpg

http://seattletransitblog.com/2013/02/13/15-15-affordable-transit-friendly-housing/

In streetview, they look like this
https://www.google.ca/maps/place/Ba...2!3m1!1s0x549015d57a5da881:0xd07680ac0ad3f49c

You could just take all those bungalows, semi detached or detached and add a second floor.
Get something like these in Montreal (for second floor over semi-detached, think like the ones in Jane-Finch)
https://www.google.ca/maps/place/Sa...2!3m1!1s0x4cc9180faceface3:0xb28b84ea5ee62835
Although in Jane Finch parking is mostly front-loaded so if that remains the same I guess it would look more like this.
https://www.google.ca/maps/place/Sa...2!3m1!1s0x4cc9180faceface3:0xb28b84ea5ee62835

Or backyard cottages. Or laneway housing if there's a laneway.
 
It's been mentioned on UT (and elsewhere) that Toronto is not that interesting for people coming from cities like New York, Chicago, Boston, San Francisco, Berlin, Paris, etc and that even Montreal is more interesting. Although there's not much that can be done to get architecture (especially historic) and the great museums that come from a period wealthy cities for centuries. However, if Toronto can get denser and more diverse, with dozens of Kensingtons and Yorkvilles throughout the core, connected by high quality transit, while it might still be behind New York and Paris, I think it can certainly rival Montreal, San Francisco and Boston.

That's quite an amazing vision. Very interesting series of posts. It does seem impossible or difficult for new developments to be as nice as Kensington Market or places like Little Italy or Queen West in terms of both retail and housing, in terms of vibrancy and aesthetics as well as how interesting it is.

I agree with your vision for infill housing to increase density. I love places like the Plateau in Montreal which have housing split into double & triple deckers, as you mentioned. Backyard & Laneway houses are great too.

Shops at Don Mills is an interesting attempt, and I like it better than the typical mall, but I would still choose Kensington or St Lawrence or Distillery over it any time.

Also, I don't have data to support this, but anecdotally there does seem to be demand for smaller, denser houses which are not necessarily condo towers. Things like townhouses or low-mid rise apartments.
 
How does the Shops at Don Mills compare to Kensington?
I've only been once, but I'd say while Shops at Don Mills is nice for what it is, with attractive streetscapes and landscaping, it's rather different from Kensington Market. Right now it's mostly brand name stores and restaurant chains right?

I'm not really familiar with the development but it's basically all owned by one company right? It makes for a more rigidly controlled environment. That means that while it might go downmarket as it ages (unless it renovates to renew itself again), it is unlikely to be changed and customized incrementally and organically the way a place like Kensington Market might. While it might get some more independent businesses especially if it goes downmarket, it's never going to have the dynamism of Kensington Market.

It's also in a more suburban setting of course. Although there are some apartments nearby, and they're building condos too, the catchment area is still quite a bit bigger, so much of the customers are going to arrive by car.

I guess a place like that has its appeal too. Some people like brand name stores. I would probably go occasionally too if I had a place like that close by. If you have enough density, you can have both types of retail nearby. I don't think it's an acceptable substitute for places like Kensington Market though. You still want to have lower cost customizable spaces where people can start new local businesses, which is good for the economy, since the profits stay in-town, and those profits can be quite significant for those few start ups that grow into something big.

Also from the tourism point of view that UTers were talking about here I think you want shops and restaurants that are unique to Toronto and not just international brands. Although I guess in the case of NYC, a lot of tourists who go there for the shopping go for the brand name stores, it's just that it has basically all the brand names concentrated in one place.
 
I've only been once, but I'd say while Shops at Don Mills is nice for what it is, with attractive streetscapes and landscaping, it's rather different from Kensington Market. Right now it's mostly brand name stores and restaurant chains right?

I'm not really familiar with the development but it's basically all owned by one company right? It makes for a more rigidly controlled environment. That means that while it might go downmarket as it ages (unless it renovates to renew itself again), it is unlikely to be changed and customized incrementally and organically the way a place like Kensington Market might. While it might get some more independent businesses especially if it goes downmarket, it's never going to have the dynamism of Kensington Market.

It's also in a more suburban setting of course. Although there are some apartments nearby, and they're building condos too, the catchment area is still quite a bit bigger, so much of the customers are going to arrive by car.

I guess a place like that has its appeal too. Some people like brand name stores. I would probably go occasionally too if I had a place like that close by. If you have enough density, you can have both types of retail nearby. I don't think it's an acceptable substitute for places like Kensington Market though. You still want to have lower cost customizable spaces where people can start new local businesses, which is good for the economy, since the profits stay in-town, and those profits can be quite significant for those few start ups that grow into something big.

Also from the tourism point of view that UTers were talking about here I think you want shops and restaurants that are unique to Toronto and not just international brands. Although I guess in the case of NYC, a lot of tourists who go there for the shopping go for the brand name stores, it's just that it has basically all the brand names concentrated in one place.

Yeah, I would describe it as a mall that's made to try to look like a traditional downtown retail area, with streets and storefronts.

Another example would be this development in Leaside:
http://goo.gl/maps/kXBvQ

It kind of tries to mimic a street grid with buildings, and some of the buildings are restored historic industrial buildings, but it still feels like a big box area with big parking lots since the "street grid" is only connected to the regular streets at certain entry points.

It's interesting because developers of suburban malls and big box shopping centres seem to be trying to mimic genuine urban areas. Both are good places to shop, but they mostly have the same stores as (upscale) malls or shopping centres, and probably not a tourist draw like Kensington or King West. Having said that, I do hear Shops at Don Mills has better restaurants or retail than most malls.
 
That's quite an amazing vision. Very interesting series of posts. It does seem impossible or difficult for new developments to be as nice as Kensington Market or places like Little Italy or Queen West in terms of both retail and housing, in terms of vibrancy and aesthetics as well as how interesting it is.

I agree with your vision for infill housing to increase density. I love places like the Plateau in Montreal which have housing split into double & triple deckers, as you mentioned. Backyard & Laneway houses are great too.

Shops at Don Mills is an interesting attempt, and I like it better than the typical mall, but I would still choose Kensington or St Lawrence or Distillery over it any time.

Also, I don't have data to support this, but anecdotally there does seem to be demand for smaller, denser houses which are not necessarily condo towers. Things like townhouses or low-mid rise apartments.
Well when you look at the commercial parts of Kensington Market, it's not something that requires that designs of a great starchitect, nor is it highly ornamented buildings built by an army of highly skilled stonemasons. Most of the buildings look like this:
https://www.google.ca/maps/@43.6548...!3m5!1e1!3m3!1speWN1GXLByyYObSKIZV0Kw!2e0!3e5
IE very modest architecturally. It's all about how the buildings interact with the street. Also very important is the wide variety unique ideas of a wide variety of actors concentrated into a small area. Each business owner or building owner has customized their spaces in their own way, with their own style of signage with different fonts, sizes, shapes, logos, different building cladding, colour schemes, balconies, no balconies, awnings, patios, fruit stands, benches, murals music... It's very complex and diverse, which makes for a less predictable environment, so you never what surprise is around the corner.

If you have a big chunk of land built by one developer, it will be standardized according to a single vision. And if they try to make it diverse it will just seem contrived.

While some might argue that the attractive historic architecture plays a role in the appeal of Queen West or Little Italy (although I would say that there's only a minority that are really stand-out buildings), I think it's very difficult to make that case with Kensington Market (especially the retail streets). That show that you don't need ornate historic architecture, it's nice to have and worth preserving where it exists, but you can still have one of the top neighbourhoods in the city without it.

Tokyo is more proof of this. Despite having been utterly destroyed during WWII and been rebuilt merely with modernist boxes, I think most people would agree it's one of the most vibrant and interesting cities in the world. Much of what makes it what it is is narrow streets with relatively small tightly packed buildings that have been customized by their unique owners, and there too, you often have a lot of the fluid interaction with shops "spilling out onto the street".
tokyoRNS1.jpg

http://www.newworldeconomics.com/archives/2014/041314.html

The Lower East Side used to look like this.
tumblr_n4gv6zhSgz1s7e5k5o1_500.png

While it was poor and crowded, it was still very vibrant. With the crowding, it was about 10-12 times denser than Kensington Market today, but even without the crowding it would have been about 4 times denser.

With Venice, while the canals and the grand architecture of the palaces on the grand canal are part of the appeal, I think streets like these are part of what makes Venice what it is too.
venice_street.jpg

http://bojinov.org/munich_venice/
These are basically just narrow 4 storey boxes with punched windows on a narrow street. The ornamentation is not in the form of stone carvings but awnings, patios, unique signs, flowers, etc... same as Kensington.

Venice and Tokyo have streets that are narrower than Toronto's, even the narrower residential streets. But Toronto's currently residential streets are still relatively narrow, the residential streets that are potential future commercial (or partially commercial) streets are relatively similar in width to the Yorkville Avenues/Augustas/Baldwin Streets. It's narrower and more intimate than Bloor or Dundas, and definitely narrower than suburban arterials like Sheppard.

I think the way we experience an urban neighbourhood, including our own, is disproportionately defined by the commercial streets. When you walk to the store or restaurant, or to transit (usually on a commercial street), I think most people take the shortest path to the commercial street so maybe they spend 50% of their walking time on the commercial street and 50% on a residential street even though 90% of the neighbourhood's streets are residential. And the more interesting part of the walk is probably the part on the commercial street.

That's why I don't really agree with the protectionist attitude towards residential parts where it's not ok to build condos or anything really in the residential areas, but it's ok to build condos on the commercial streets. It's important to make sure you still have vibrant commercial streets.

Now probably 80% of Toronto is narrow (<60ft in the suburbs, <30ft in the core) lots, but only about 5-10% is retail. So it's not that you can't have any development on the commercial streets. That new condo on St Clair can be where the neighbourhood LCBO goes. But you still want to have space for small scale independent businesses. If you're going to reduce the space available on avenues like St Clair, you should make up for it by allowing retail on currently residential "arterials" like Dufferin, Rogers, Oakwood and Bathurst, minor through streets like Brock, Argyle or Hallam, or even random locations on street corners, side streets near subway stations, etc.

Intensification in residential areas isn't going to displace independent retail. Although the massing needs to be at least a bit bigger than neighbouring lots for it to be intensification, as long as it's not too much bigger, and still relatively narrow (doesn't have to be 15-20ft like some rowhouses, but ideally not much more than say 40ft) I think it should be fine. And I think you should be able to go a bit taller on street corners and wider streets. That's basically the current setup with the streets and avenues of Manhattan. Avenues are wider with more street corners and also have taller buildings than the streets. And in places that already have tall buildings (or at least nearby) or that are buffered from lowrise areas, like many brownfield and greyfield redevelopments (although taller buildings are already allowed in most such places).
 
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You're right, it's not about the architecture of the buildings, at least in terms of ornamentation or style.

It's the width of the storefronts, the width of the road, the stores facing the street, the street wall & height. Also things like having patios, open storefronts & windows facing the street to create a sense of the stores mixing in and being part of the street.

Kensington Market has character, vibrancy, and is an interesting place to visit with retail & restaurants you don't find anywhere else. In the age of suburban big box stores having the same stores everywhere (Chapters, Starbucks, Boston Pizza, Kelsey's etc), this is especially valued.

In terms of turning residential areas into retail, I was very happy to see that in Eglinton Connects, they change some areas on Eglinton between Mt Pleasant and Bayview into retail/commercial zoning, where currently it is apartments only.

I think the difficulty in reproducing these "authentic" & walkable retail streets like you'd find in downtown (ex.. Queen st W), or some places outside downtown (Yonge st in midtown, Avenue road north of Lawrence, Bayview in Leaside), has probably increased the value of neighbourhoods that have the remaining ones. Hopefully areas like that can be re-created in more places in Toronto, somehow.

I do wish there were more narrow commercial streets in Toronto. It does create a more intimate atmosphere as you've shown in those photos. Having said that, the tall building on a wide road big-city feel can be cool too, like in Manhattan. I think if the height of the buildings form a wall that is taller when the road is wider, it creates the closed-in "room" feel that makes a place feel urban and nice to be in.
 
A recent article in the Star on the skewed infill development going on throughout the area.
The great Toronto rebuild
Realtor John Pasalis has watched the rebuilding boom sweep whole pockets of the city, making the postwar bungalow an endangered species in areas like East York and Scarborough’s Hunt Club area near Kingston and Birchmount Rds.
These new builds have a domino effect, turning affordable areas like Leslieville into new urban hot spots where everyone feels the heat: A $650,000 home that is flipped post-reno for $1.1 million becomes the new comparable for every future home that goes up for sale, and also drives up area taxes.
But they are going to remain a major force in Toronto’s single-family home market, even as they continue to decimate the supply of more affordable housing.
“What’s driving a lot of this is people’s desire to live in the city, but they want some of the same amenities as in the suburbs. East York bungalows just aren’t practical by today’s standards, even for a couple,” says Pasalis.
“Builders have to build these houses to cater to that demand.”
Burlington-based real estate consultant Ross Kay worries that city officials haven’t thought through the implications of okaying rebuilds with whole new floors or massive additions that are actually changing the character of streets.
“The City of Toronto is decreasing affordability across all of Toronto because of the trickle-down effect caused by seemingly innocent decisions they are making around infills and renovations,” says Kay.
He argues that the city has the power through its building permit approval process to limit the scope of rebuilding and focus more, instead, on encouraging multiple houses, where possible, on single-home building sites. Creating two semis, rather than one $2 million mega-home, would open the door to more first-time buyers, he argues.
Professor McKellar knows that argument well. A developer is now facing stiff community opposition in McKellar’s Midtown neighbourhood for seeking to raze two bungalows and replace them with four townhomes.
Approval is almost inevitable, says McKellar, given the province’s Places to Grow legislation, passed in 2006, that makes intensification a top priority, with some 40 per cent of all new growth aimed at infill sites.
“It would be silly for the city to step in and say, ‘We want Toronto to look just like it did in the 1940s.’ People have said: ‘We don’t want to live like this any more, in little bungalows with tiny closets.’ ”
The bigger issue is that Toronto’s zoning bylaws, dating back to the 1950s, are desperately in need of an update. That’s lead to what McKellar calls a sort of “let’s-make-a-deal” juggling of developers’ demands and homeowners’ wants.
“What the city needs to do is be clear on what qualities of each neighbourhood it wants to maintain.”

The inability to increase density on these properties seems to be leading to mansion-ization and declining affordability.
 
These days, condos have replaced the small bungalows of the 1950's, as starter homes. The trouble is that those small bungalows have the land available to add on additions or second floors for an expanding family. Condos don't have that possibility, unless they are able to buy the unit next door (or above or below) and cut through the concrete separating them.
 

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