By Roger Lips

Will Sidewalk Toronto “Uber-ize” Urban Innovation?

All around us, industry stalwarts are losing ground to the upstarts of innovation.

Roger Lips

All around us, industry stalwarts are losing ground to the upstarts of innovation. Twenty, or even ten, years ago, it might have seemed inconceivable that the monoliths such as hospitality, transportation, or banking would lose their seemingly iron grips over their client bases — yet today, they sway like giants on sand legs, only a few years and missteps from toppling over. 

Innovative technology has redefined our rote behaviors and daily decisions. When we plan a trip, we pass over the local Hilton for a cozy townhouse reserved on Airbnb. Rather than wave down a taxi, we wait for our Lyft or Uber driver to wave to us. Even conventional banks are losing their previously unchallenged hold on our investments as fintech startups such as Wealthfront and Acorns offer themselves as more accessible and affordable alternatives to small-scale investment.

We are in the midst of a golden age of innovation; one driven by data and centered on giving consumers what they want, when they want, and with as little inconvenience as possible. Disruptive startups empower consumers to access services with only a few taps on their smartphones, thereby circumventing — and challenging — the reach of companies and institutions that once held a near-monopoly on their customers. 

Yet, there are a few fields that seem — at least on first glance — to be immune to the disruptive effects of innovation and continue to plod along on conventional ground. Take real estate development as an example; as a capital-intensive, inflexible, and time-intensive as the sector is, it seems ill-suited to the fast-paced accessibility that tech-centric disruption fosters. Some companies in the residential sales market have made forays into innovation, of course. Services like OpenDoor, Redfin, and Zillow have settled into the direct homes-sale and homes-flipping sector over the past five years; the last company even made headlines in early May of 2019 by announcing its intent to bring in $20 billion annually from its homes segment and capture 1% of the American home sales market within three to five years. 

To quote a statement made by Zillow’s CEO, Rich Barton, during an earnings conference call earlier this year, “Our daring plan to transform the real estate transaction for the super-empowered, smartphone-wielding, Uber-ized consumer is, in fact, coming together, or at least it’s beginning to come together.”

However, for all the aplomb that Barton indicates, his “daring plan” seems somewhat limited and underwhelming in effect. Though it does plan to tap the “Uber-ized” consumer, it doesn’t seem to be overhauling the underlying philosophy of the real estate sector in quite the revolutionary way that the moniker seems to indicate. The names and direct-to-consumer sales will change, yes, but the mechanics of development and all of the industry’s set-in-concrete conventions will remain mostly unchanged. Real disruption comes when change-making innovators use data to drive a revolution. Rather than a landslide of industry-redefining disruption, Barton seems to offer a localized tremor in the residential market. 

However, a genuine, Uber-grade revolution in the real estate sector is well and truly underway — and starting in Canada. 

Toronto Tomorrow: The “Uber” Event of Urban Innovation?

In late June of this year, Sidewalk Labs released a 1,500-plus page proposal detailing its proposal for a high-tech, flexible, data-driven utopia on the Toronto waterfront. Highlights of the document include the addition of all-new, mixed-use buildings and thousands of housing units — 40% of which would be affordably priced in Toronto’s notoriously high-cost rental market — as well as a light-rail extension. The community’s climate-positive design plans to slash greenhouse gases by 89% and encourage residents to make 75% of their travel experience by transit, walking, or cycling. Innovations like self-heating pavement will melt snow to all for bike, foot, and communal travel, even during the heart of a Canadian winter. 

By itself, all of these changes are innovative if not, strictly speaking, disruptive. What makes Sidewalk Toronto special, however, is its close relationship with real-time data. As one reporter for CityLab writes, the community would be “heavily connected, monitored, and self-regulating: Wifi would be publicly available, and sensors throughout the neighborhood would collect data about energy consumption, building use, and traffic patterns, among other urban fluctuations, which a software platform would analyze and manage.”

Sidewalk Toronto offers a vision for a wholly “smart” city, built from the ground up. It can grow, change, and base its development on the real needs and behaviors of its citizens, rather than thin projections and expectations. It can suit the needs of a new generation, one that cares more about ease of use than ownership and prefers flexible sustainability to concrete longevity. This is the data-fueled innovation that people want, the “Uberized” model that gives consumers what they want and need before they even realize that they’re reaching for it. Zillow, Redfin, and OpenDoor may have changed the sales process, but Sidewalk Labs promises to revolutionize the development process.

To be fair, the project has not come to fruition yet — and has indeed faced considerable debate around data use, privacy, and other hot-button consumer concerns. However, if Sidewalk Labs’ experiment in Toronto goes well, their model for urban innovation may well change not only our approach to real estate development, but the very philosophy that underpins it. 


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