Rachel Cohen-Murison stands at the forefront as an architect and entrepreneur, embodying the fresh wave of innovative designers who are shattering the norms of the conventional practice. They're adopting a more entrepreneurial approach to architecture, strategically creating value by eliminating market pain points.
Rachel and her contemporaries undeniably signify the brilliant future of architecture. As digital natives, they're unchained from the typical constraints of traditional practice.
As Jake Rudin astutely pointed out in a previous episode, this groundbreaking approach solidifies that architects hold a unique position to tackle the pressing issues of tomorrow. They're equipped to devise innovative solutions beyond the reach of other professions.
Discover how Rachel is trailblazing this path.
https://www.rohehomes.com/lotus-mini-prefab-homes/
https://www.dencity.build/calculator#
About the podcast: Single Serves is a podcast where we interview experts on single issues of interest to architects and designers. The thought-provoking ideas shared here are intended to inspire our listeners to become well-rounded entrepreneurs who are the leaders of their field.
Credits: ©2024 Produced by Révélateur Studio & edited by Chris Rodd
Transcript below edited for clarity and brevity:
RVLTR:
Thank you very much, Rachel, for joining us on the show.
Rachel Cohen-Murison:
Yeah, thanks for having me, Arnaud.
RVLTR:
So we're going to start with a really hard question. Obviously, that's a joke. But can you tell us who you are and what you do in your own words, in three sentences or less? And I'm not going to count the sentences, it's just a good-
Rachel Cohen-Murison:
Okay. Okay. Tricky. Yeah, I'll try to keep it succinct, but basically I'm a Toronto-based designer with an architecture background currently involved in the Accessory Dwelling unit sphere. So that means everything backyard home.
I have developed a software, as you said, to allow homeowners to understand their eligibility to build a backyard home. I'm a consultant with a marketplace for backyard homes in Canada, as well as working alongside with a West Coast builder of modular housing. So yeah, everything to do with backyard housing.
RVLTR:
That's great, and I'll be sure to link all those relevant websites in the show description.
Rachel Cohen-Murison:
Perfect.
RVLTR:
Let's start with the genesis of Dencity. How did the idea of this business come about?
Rachel Cohen-Murison:
Yeah, so it was really during the pandemic. My partner and I had some extra time on our hands, as some people did. And we saw what was happening with the laneway suite policies in the city. More and more homeowners, specifically in Toronto, were interested in understanding their eligibility to build backyard homes. But they really had very few resources, maybe a Facebook group to ask other homeowners how to build. They didn't understand the bylaws. I was getting questions even from other clients to work about ADUs, backyard housing, laneway suites and different cities. So yeah, we thought, "Why not take my architecture background and knowledge, being able to decipher bylaws and put that to code with a 2D-3D interface?" That was my partner's strong suit, coming from computer science. So yeah, that's how it got started.
RVLTR:
That makes a lot of sense. So was there a specific problem that you might want to expand on a little bit that you were trying to solve with this platform?
Rachel Cohen-Murison:
Yeah, I think at first it just started off as a homeowner-centric tool to better convey to homeowners exactly their property's eligibility. But then it turned into much more of a global mapping tool for us to better understand the city, and see how many properties are eligible for a one-story or two-story unit. What is the true impact in terms of the missing middle solution that laneway suites or garden suites can have in a city like Toronto? And it turns out there are thousands and thousands of properties that could be densified with a very low bar of entry for homeowners to invest in, or companies, what have you. And so it turned into a much bigger thing where I also pivoted from capital A architecture, more into understanding bylaws and zoning at a much larger level.
RVLTR:
So would it be a fair assessment to say that without a tool like yours, homeowners would have to hire some kind of expert to analyze their property and tell them what they could do?
Rachel Cohen-Murison:
Yes, definitely. I would also say, though, that this is a stepping stone. I would say Dencity is a stepping stone for homeowners to get into it. There's also a costing calculator that's part of it, but they should still consult a professional to get into the weeds with an on-site check, site measure, getting into a full design, signing on a design professional or a builder.
RVLTR:
Of course. Of course. That makes sense. So that's been going on for a couple of years now. What has been the evolution of the tool and who has it served mostly or what use cases did you see come out of your initial idea?
Rachel Cohen-Murison:
Yeah, great question. At first it was mainly homeowners coming to me wanting to pursue further site eligibility studies in person. They use the tool, but they still have questions. Funny enough, even those who I would deem have a pretty good understanding of the bylaw, they still found the tool super useful to clarify their thoughts. And then they still might have a few questions, so they would still come to me. And yeah, we'd do an on-site study or I'd send them off to another consultant.
RVLTR:
So the laneway suites have been legal for a few years now. So aside from your tool specifically, what has the uptake been until now? And is it what the city hoped it would be?
Rachel Cohen-Murison:
Right, with laneway suite, I have to say yes, there are more permits being processed in terms of laneway suites. But the true barrier is financing. If the people can't finance, they can't build. So regardless of the laneway suite bylaws having been slightly approved upon recently in the City of Toronto, garden suites being made legal as of last autumn, I believe, and even other cities like Hamilton improving, West Coast is improving their bylaws. Again, if there's not enough financing, then homeowners can't build.
RVLTR:
So what is the barrier in terms of financing that homeowners are facing? Does it require a new form of financing? Is it hard to borrow for this kind of project? What are the parameters that people have to deal with?
Rachel Cohen-Murison:
Yeah, so that's a really good question. Basically, the banks here are not used to seeing products or creating products for backyard homes. They're used to seeing a primary dwelling and offering a second mortgage or home equity line of credit on this. I believe it takes about 30 laneway suites, let's say in Toronto to convince a bank, this is a mortgage broker, a friend of mine who told me this, to then create a product for laneway suites, let alone garden suites.
So you're seeing a home equity line of credit being offered more in a city like Toronto. But we're going to have to wait to see the same product being offered for garden suites. That's just one prong. There might be government help at one point. There might be smaller banks or credit unions offering products in the very near future. So let's see. Let's see.
RVLTR:
Are you saying that to this day there's still no specific financial product for laneway suites?
Rachel Cohen-Murison:
I know I believe that TD might offer something as a home equity line credit; taking into consideration again these 30 data points to offer financial product and nothing specific at the moment.
RVLTR:
I have a neighbor who just got a garden suite approved, so he was probably one of the first ones. And he's going to build it himself because he just doesn't have a lot of financing or cash to do it. So it's interesting to see that the financing alone can make or break a project. So beyond the financing, let's talk a little bit more about the housing shortage. What would you say are the main causes of the situation we're in right now, in your opinion?
Rachel Cohen-Murison:
Yeah, another very good question. I would say we've gone through this huge surge in housing costs. Obviously a part of the solution is supply, but it is definitely not all of it. There should likely be government intervention at a certain point, renter protection, different hybrid models of renter income, profit sharing, reducing barriers to permitting is very significant, reducing red tape, removing exclusionary zoning. All of these are really good mechanisms that I hope will be implemented in the near future.
And I do see them starting to be implemented throughout Ontario and throughout BC. I think in the next few months or by the end of the year, we should be hearing from the BC premier about doing away with away single family zoning across the whole province and allowing for up to a fourplex or multiplexes on every property, as well as an ADU.
RVLTR:
Oh, that would be great. I'm glad you mentioned the regulatory issue, because I've talked to a lot of people about this problem. And my conclusion is that part of a large part of the responsibility, and where we are today, is regulatory in nature. It's the length of permitting, the cost of permitting, the ability that neighbors have to throw a monkey wrench in the works with the Committee of Adjustment. The Committee of Adjustment itself the fact that for even minor variances, you have to go through this incredibly onerous and complicated process. And I think if politician, and it's relevant right now, because we're about to elect a new mayor in Toronto, which will happen before this podcast is released. But it's very topical. Because I think if we could elect someone who realizes that they just need to get out of the way and simplify everything. Taxation is also a major issue and that can be a problem, both with the sales tax and development charges, which are insane. Those are all issues that need to be addressed.
And I think as long as, in my opinion, the regulatory environment is not immensely simplified, no matter what other solutions we come up with increased Dencity as of laneway suites, garden suites, whatever else, it's not going to solve those problems. It's still going to be just as complicated to build anything. The problem is that, and I don't want to get political; but it seems like the front-runners in the mayoral race are not really particularly good on the issue. So if we don't elect someone who's going to solve that problem in Toronto, I'm not talking about elsewhere. I don't know what it isn't like in other cities, but I haven't hunch that it's a similar problem. Are there any other options for people, or for us as a culture or society to make it happen? Because if we can't rely on politicians, maybe we have to take the matter in our own hands, right?
Rachel Cohen-Murison:
Yeah, I know. It's incredibly frustrating and I agree with you in terms of the political stakeholders. They definitely are a significant piece of the pie. They are the ones who will have control over taxation, changing the way things are with the development charges, property tax, everything.
In terms of, I don't want to say mechanisms to, there is a potential for private industry to try to come in and suggest things to the government. I'm also involved with a group called ADU Search. They were funded by the CMHC and round one of the housing supply challenge. I'm involved as a consultant with them to try to help them develop a marketplace for ADUs across the country. And for sure they're talking to government entities. We're all trying to push for the same thing, but even in terms of one little piece of the pie that they can take off as a marketplace, it's enough to at least try to show the government for now, this is a viable market, homeowners are interested. Now you need to try to push things on your end to reduce permitting times, defer development costs, for affordable housing or for a low level development, push taxation in a different way perhaps.
RVLTR:
I always like to think in terms of solving problems by looking at the incentives that all parties involved are dealing with. Is there a way to incentivize politicians? Maybe it's with an increased tax base or whatever the case may be, to convince them that it's also in their interest to do it, and that facing the wrath of NIMBYs might be worth the trouble?
Rachel Cohen-Murison:
Yeah, look, you could provide the government with an opportunity cost of how many workers and what percentage of your tax base will you lose if you don't develop the housing for your key skilled and unskilled workers in the near future? You'll lose hospital workers. You'll lose everyone from every industry if you don't provide them housing. So someone needs to do the study.
RVLTR:
Yeah, that would be very interesting to see. Because you often hear that most Canadians' retirement money is tied in housing. And the idea is that you buy something, it increases in value over the course of your lifetime. Then you sell it when you retire to downsize and you use the proceeds to fund your retirement. Do you think there's any danger, if that's truly the case, and it seems to be for a large portion of the population, that if you increased supply, their nest egg might suffer, or is there such a shortage that no matter how much we build, prices won't come down for a long, long while? And how would you address that issue? I think that's one of the primary reasons, even though they don't necessarily openly speak about it, why NIMBYs oppose new developments is that they're afraid that their property values are going to go down. Can you speak to that?
Rachel Cohen-Murison:
Yeah. So you're wondering if putting changes or if the property values come down that they'll lose their nest egg to pay for their retirement. I would counter that by saying, "Well, what will you get again, once all your skilled workers leave?" In terms of those providing you with healthcare, with working at the grocery store, everyone around you in the community that you need to interact and survive with. And also why not give others a chance? I'm not even saying the next generation needs to be property owners. They could equally be renters, but allow them to have an opportunity to thrive in the same country that you've thrived in as well. There are alternate models to get to a sustainable retirement than taking it through your house. Even as a renter, again, you could do renter focused or renter to income profit sharing models, the likes of which I've seen work relatively well in Europe. Again, we don't need to even crash everyone's house value to bring in some step for first time home buyers or renters to achieve some stability in their lives in Canada. But something needs to change.
RVLTR:
I was just being the devil's advocate, obviously. I don't believe that there's any danger of those values going down because you would increase the supply. If anything, they might go down because if the interest rates keep going up and the mortgage terms get redefined and people get upside down on their mortgage and default, and if the prices keep going up basically and as well as the interest rates, that's what could crash the market. You could have a similar crisis is what you had in the States in 2008. And there's also, apparently, from what I understand, a lot of evidence that if you increase the housing supply, that generally increases the value of the properties around it. Because if you have more valuable properties, say, because you can put fourplexes by as of right, the houses in the neighborhood will benefit from it as well.
More people doesn't mean devalued property. Quite the opposite. And there's a lot of denser cities in the world, Paris, New York, London, where property values are insane and they have a lot more people than we do. Anyway, that's a bit of a digression, but I think it's going to be a battle of not just logic, because logic doesn't work in those instances. It's really about showing people that it's in their best interests to let others build and incentivizing them in some sense, politicians or NIMBYs or other stakeholders in the process by showing that they will benefit from it as well.
I think that the problem we're seeing right now is there's a bit of a battle of wills between people who don't want to increase Dencity because there are the incumbents with the property values that have gone through the roof and have benefited from it. And the people like me and perhaps you as well, who haven't been lucky enough to enter the market at the right time and are now finding ourselves in a more precarious situation than even five or 10 years ago. And instead of pitting one against each other, I think it's really about showing each side that they can all benefit from increased Dencity and a more vibrant culture in society, especially in the big city like Toronto that keeps on growing and never seems to stop.
Rachel Cohen-Murison:
That's it. That's it. And we all want to be part of the city.
RVLTR:
So far. Some to leave, but that's a different story. So let's talk a little bit about your tool more. What's the role of data, urban planning, policymaking and design?
Rachel Cohen-Murison:
Yeah, so I'd say it's multifaceted, but in terms of what we do with Dencity, there's a front-end, so homeowner-facing app. But as I mentioned, there's also the back-end. We're able to apply a data science approach to analyze all this data and see what the ideal footprint is for laneway suite or a garden suite. Also envisioning something in a 3D tool is pretty useful for a city like Toronto or Vancouver where there are all these angular plane requirements. And from a homeowner's perspective, yeah, they understand that.
RVLTR:
That's another point that we heard we need to do away with.
Rachel Cohen-Murison:
Sure. Exactly. Yeah. Maybe a carryover from more NIMBY policies of the past, but especially in Vancouver. But yeah, that's something to help people at a very vernacular level understand bylaws as applied to space. So yeah, we've extended this into Sechelt as well. You'll notice on our website, it's not just Toronto. We also offer Sechelt BC on the Sunshine coast, small city north of Vancouver. So you can play around with putting one of the row homes on a property there.
RVLTR:
And so the data you work with, you said part of it is collecting from the people who use your tool, but the existing data that allows you to perform those analyses, is that data that's freely available? How did you get access to it?
Rachel Cohen-Murison:
Yeah, so the data you can actually find on Toronto's open data portal. Anyone can go in and download. They have different iterations every few months updates to the data, and it's all GIS-based, so geospatial.
RVLTR:
And so that data is basically open source and you're building a tool on top of that to do those analyses of people's properties, right?
Rachel Cohen-Murison:
That's it, yeah. And I inject the bylaw info on top of the geospatial through code, and that's what you get at the end of the day.
RVLTR:
Let's broaden the conversation even a little more, and because you're at the forefront of developing tech-based tools to simplify the process and maximize people's property values. What do you think the future is looking like when we're talking about applying tech to architecture planning or construction?
Rachel Cohen-Murison:
So I would also just go back there a little note about maximizing property values, although that is obviously a concern that homeowners want to preserve their property value, not have it go down. It's not always the evidence behind building. A lot of homeowners from the survey I did with Dencity a few months ago, their primary motive was actually to house family, and then second was rental income, third was agent place, and there were a few other [inaudible 00:13:53].
RVLTR:
Well, that's exactly what my neighbor is doing. He's building the garden suite to house his kids because they can't afford to live in the city houses. And when he gets to retirement age, his kids can take over the main house and he can move into the garden suite as his retirement home, basically. That's the whole idea. So I could totally see that playing out literally in my backyard.
Rachel Cohen-Murison:
Yeah, exactly. Exactly. But in terms of you asked about the future of tech as applied to architecture planning, et cetera. Yeah, so the way I see it, there are a few companies in the picture right now that are doing something similar to Dencity in terms of providing a digital planning tool, whether it be a you search ratio city in Toronto, Symbium out of California. They have a very interesting model called Complaw. I believe they've submitted their own, they created their own word there, computational law.
But basically all of us operate in this realm of applying geospatial data in an online software to allow homeowners, policymakers, planning and permitting offices to speed up processes. So the way I see it, there will be more and more city-based permitting softwares. That's what Symbium's doing with their build product in I believe a few municipalities in California. Yeah, Ratio City helps developers and planners better understand property-based densification, [inaudible 00:14:58] again, going more into the marketplace, but they help homeowners understand ADU viability in people's backyards. So yeah, I see that as being one branch. I think there will also be more vertically integrated housing products that operate with the software, might have a prefab solution, but go from beginning to end with homeowners as a full vertical product.
RVLTR:
What time interval do you think we will start seeing some solutions like that? Because you've hinted at the issue in the preparation for this, and I've talked about this many, many times with other guests, the way we build is basically the same as it was a hundred years ago, or at least 50 years ago. It hasn't really changed.
The quality of building maybe has gone up or the technical performance of building has gone up. I don't know if the quality has, but the performance has. But that's about it. And it's increasingly more expensive to build, especially if you compare to other industries where the prices of materials and products keeps going down, or if it doesn't go down, you continuously get more for what you pay. So if you take computers for example, the computer today is probably just about as expensive as it was... It's probably cheaper than it was 30 years ago. It's also a hundred times or a thousand times faster. And I still can't figure out why we haven't seen efficiency and cost gains in the architecture building industry. Because if anything, it should be going down up. What's your take on that?
Rachel Cohen-Murison:
I know that's a really tricky one. I think it's going to take a builder who is executing something, again, maybe one of these vertically integrated products that's likely prefab, but at such a scale that there's an efficiency there where materials are sourced more cheaply, fabrication is so streamlined. Cost of labor may be the same as any other worker, but you've just made their time that much more efficient, cut down on say 70% of the inefficient time use at a labor level. That brings in huge efficiencies later on in terms of the end price.
Also, if you can truly harness again, do away with all the red tape and leverage low barrier of entry housing options that don't require as much permitting, that don't require as hefty development charges, that will cut down hugely on the end price of a project. Like when I'm talking to a city planner in Kelowna about ADUs and I mentioned how Toronto has deferred development charges for I believe 20 years, which may be too long of a time on their ADUs. As long as you live on the property, maybe it's 15 years, the Kelowna office says, "Oh, maybe we should think about that. Maybe we should be reducing or deferring development charges to just let in a lower barrier of entry, low level housing option."
RVLTR:
And so there was a company that showed promise in vertically integrating everything that was Katera that went belly up a couple of years ago. And we haven't really seen anything like that since or even before. And so the promise of, at least in the case of prefabrication to being the solution to or woes has failed to materialize as far as I'm concerned. Maybe there are things happening that I'm not aware of because architects have been talking about prefabrication for decades, but it's never become mainstream. It's still a niche service or product. Do you have any idea why?
Rachel Cohen-Murison:
That architecture is such a niche product?
RVLTR:
No. That prefabrication has remained niche when it is been touted as this solution that could solve all the problems. And why isn't it more adopted more broadly?
Rachel Cohen-Murison:
Yeah, so I think there's one thing which is literally the construction constraints. What kind of prefab are we talking about? Panelized versus modular. If it's modular, you're looking at what could fit on a tractor on a truck bed basically to ship to site. So that has literal volumetric constraints. And then what a crane can crane in. In terms of panelization, again, are you getting around, you have certain advantages as a modular builder, if you can get CSA approval and if you can get everything permitted in factory with the modular volumetric, great because then you get 80% of the construction permitting out of the way, just put it on site. But again, if you can't put that in with a crane at the scale and size that fit on a truck and you need to go panelized, that might still require more permitting and checking and planning to get that on site once it's on site, which might just make it at the same level of complexity and having the same timeline as building on site potentially.
RVLTR:
Yeah, I think from what I understand, modular is the more promising of the two. It's more constrained in terms of what you can design, but there's ways around that. The panelized system, what I've been told by clients who use it regularly is that it produces better performing buildings, but they're not cheaper. It cost about the same, maybe a little more, but you just get higher quality buildings.
Rachel Cohen-Murison:
You will. Yeah, for sure. Higher thermal, very good thermal ratings, higher quality. It's not left in the rain while you're building. So of course, hey, if you want to pay the same but just get a higher quality product, great. But again, I still think a builder needs to come in at volume and just produce these quickly. You can also look to Quebec because I do believe Quebec pricing with their modular builds, both panelized and volumetric, is still more affordable based on labor costs there and material costs.
RVLTR:
Yeah, I've heard that before as well. We've covered a lot of ground. We went all over the map in terms of the housing shortage and what are some of the causes and the solution? How would you summarize our conversation in a couple of sentences? What would you want our listeners to take away from this?
Rachel Cohen-Murison:
Yeah, so I just want to end by saying why I'm interested in ADUs and missing middle is because we are, again, in this time of immense housing insecurity, housing shortages across the country. So I personally am interested in understanding the three barriers for missing middle, which are financing, construction and permitting. And that's how I situate myself with the work that I'm doing with Dencity, with the companies that I consult with, the government entities I speak with because ADUs are part of the solution, not all, and I'd just love to see more options out there. There is a healthy environment of other startups coming in who are also interested in this, like Partna which is offering alternative financial solutions to Canadian homeowners. Again, ADU search real homes, all these people who are trying to improve with these three barriers. It'll take time, but I see it happening already.
RVLTR:
That's a great positive note to end on because it's easy to get frustrated when talking about this issue. I want to thank you very much for your time. The last question I would have for you is what has been your favorite part of this interview?
Rachel Cohen-Murison:
Favorite parts? Just getting to speak about all of this again and tie this back to the more global issues we face and realizing I'm not alone in my struggle as well. I believe you and others, you're thinking the exact same things. It's just good that we have a forum through podcasts like this to express ourselves and discuss solutions.
RVLTR:
Yeah, I think conversations like these are where solutions start to emerge, so it's very important to have them.
Rachel Cohen-Murison:
That's it.
RVLTR:
Well, thanks again for your time. It was a great pleasure to have you on the podcast, and hopefully it's not the last time.