Issue #36: The Art of Making Sh*t Up

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Welcome back, everyone!

This week finds me contemplating the fine line between meaningful innovation and innovation for its own sake – a distinction that seems especially relevant as the federal government unveils its ambitious plan to reach 500,000 housing starts nationwide.

With the election already fading in the rearview mirror, Mark Carney and company are doubling down on their promise to solve Canada's housing crisis through sheer volume. But as anyone who's actually built anything knows, there's a world of difference between setting targets and hitting them.

[and yes, everyone says I look like Jason Bateman]

But before we dive into the main event, someone cornered me at an affordable housing event last week with a surprisingly basic question: "How's the Calgary resale market doing? Generally speaking, in normal people talk—none of that Greg advanced development mumbo-jumbo."

I started rattling off average days-on-market statistics and absorption rates before they interrupted: "Do you just look at if prices are up or down?"

Their question instantly transported me back to 1998...

SCENE: Oakville, Ontario. Our development firm's headquarters. I'm a freshly minted Development Coordinator, surrounded by maps of our active West GTA communities with a stack of reports about a potential 100-acre farm acquisition in North Whitby—our first venture into the East GTA market.

The CEO, coffee in hand, materializes next to my desk with that casual "just wandering by" energy that immediately tells you it's not casual at all.

CEO: "Mills! How's that North Whitby acquisition looking?"

ME: (straightening papers nervously) "Good progress, sir. Environmental Phase 1 looks clean, and the preliminary geotech doesn't show any surprises."

CEO: (nodding) "What about the resale market over there?"

ME: (confidently) "It's good."

A beat of silence as he sips his coffee, eyes never leaving my face.

CEO: "Good?"

ME: (doubling down) "Very good. Robust, even."

CEO: (setting his coffee down) "What's the months of supply?"

ME: (blinking rapidly) "The... months of..."

CEO: "Supply. Basic real estate indicator. You divide active listings by the monthly sales rate. Tells you if it's a buyer's or seller's market."

Now, I could have admitted I had no clue. Instead, I went with:

ME: "It's... in the normal range."

His eyebrow arched so high it nearly left his forehead.

CEO: "Which is?"

ME: (sweat forming) "The... acceptable range?"

CEO: (sighing) "Mills, there are three market conditions determined by months of supply. Under 4 months is a seller's market—prices rise. Over 6 months is a buyer's market—prices fall. Between 4-6 months is balanced. Right now, Whitby is at 2.3 months, which is why we're looking at land there in the first place. This is Development 101."

ME: (dying inside) "Of course. 2.3 months. Exactly what I meant by 'good.'"

CEO: (retrieving his coffee) "Next time, just say you don't know and go talk to the realtors. They track this stuff religiously." He paused at the doorway. "And Mills? They know everything. Not just about months of supply, but who's getting divorced, who's in financial trouble, and which properties might come available before they hit the market."

Two priceless lessons from that mortifying moment:

1. Never try to hogwash your CEO. They didn't get to be CEO by being easily hogwashed.

2. Talk to realtors. They know everything—not just about markets, but about the human elements driving those markets.

And with that humbling flashback complete, let's get back to innovation...

The Innovation Trap: When "New" Isn’t Neccessarily "Better"

SCENE: Calgary, a sleek downtown design studio, 2014, pre-oil crisis. Material samples cover every available surface as Mary, our project architect, and I debate finishes for our latest condo development.

MARY: (holding up an unusual speckled countertop sample) "This is the Nebula Series. Just launched at the Milan Design Show. Nobody's using it in Calgary yet."

ME: (examining it skeptically) "Interesting. But we were thinking of the Regal for the countertops. It's been our best seller in every condo project across the city."

MARY: (rolling her eyes) "The Regal? Everyone uses the Regal. Every builder, every development. It's so... predictable."

ME: "That's exactly the point."

MARY: (looking confused) "You want to be predictable?"

ME: "I want to be successful. The Regal sells because it works. It's neutral enough to appeal to most buyers, durable enough to last a nuclear event, and familiar enough that suppliers always have it in stock."

MARY: (sighs dramatically) "But don't you want to innovate? Push boundaries? Create something fresh?"

ME: "Not for innovation's sake. If a new material performs better, costs less, or genuinely improves the user experience, I'm all for it. But different isn't automatically better."

MARY: "Your customers might appreciate something more design-forward."

ME: "My customers appreciate resale value. And you know what hurts resale value? Being the only condo in the building with countertops that went out of style faster than frosted tips in the 90s."

MARY: (laughs despite herself) "You're impossible."

ME: "I prefer 'pragmatic.' Besides, we can push boundaries where it matters—energy efficiency, space utilization, amenities. But some things work because they just work. No need to reinvent the kitchen counter."

This conversation has been playing in my head as I look at the federal housing plan's emphasis on "innovative housing solutions." Innovation has its place, but sometimes the most innovative approach is to stick with what works and just do more of it, faster.

Which brings me to...

Greg’s Math: Calgary’s Share Of The 500,000 Housing Start Pie

If the feds are serious about hitting 500,000 housing starts nationwide, what does that mean for Calgary? I've crunched some numbers, and they're eye-opening.

Looking at Q1 2025 data:

• Calgary city proper: 4,995 housing starts

• Calgary CMA (broader area): ~6,271 starts

If we annualize these numbers:

• City proper: ~20,000 starts annually

• CMA: ~25,000 starts annually

Now here's where it gets interesting. The current national six-month trend shows about 235,316 annualized units. That means Calgary currently represents 8.5-10.6% of national housing production.

But when we look at the 500,000 target:

• At our current pace (25,000 units), Calgary would contribute just 5% of the national goal.

• To maintain our current share of national production (around 10%), we'd need to hit 50,000 units annually.

• A more realistic target—accounting for Calgary's stronger growth compared to other major centers—might be around 35,000 units, or 7% of the national goal.

Let that sink in.

We'd need to increase our current production by 40% to hit 35,000 units.

In 2024, Calgary had over 20,000 starts for the first time, and we saw:

• Trade shortages that delayed projects by months

• Material costs skyrocketing

• Quality control issues as builders scrambled to find workers

• Municipal approval backlogs that made the current system look lightning-fast

And now we're talking about nearly doubling that?

This isn't just a stretch goal—it's a fundamental transformation of our development ecosystem.

The "Innovation" Conversation

And that's where innovation comes back into the picture. Not the superficial kind, but meaningful innovation in how we deliver housing at scale. Enter prefabrication construction (called modular construction if you are a cool kid) — approaches that could help address our labor constraints and speed up delivery.

But even here, we need to be careful about innovation for innovation's sake.

Case in point:

SCENE: A builder's showcase event last week. I'm chatting with a representative from a new prefab company that's been making waves in architectural circles.

ME: "So tell me about this Modular Series you're promoting."

BUILDER: "We call it the T-House."

ME: (confused) "Why is that? Do you include a tea set? Is it a British design?"

BUILDER: (enthusiastically) "No, no, the house is in the shape of the letter T!"

ME: "That doesn't sound too efficient."

BUILDER: "Fat in the front, and skinny in the back!"

ME: "Hmm..."

BUILDER: "Haven't you seen all the kids today with their modern mullets? This is the modern mullet house!"

ME:😕

BUILDER: 😄 

ME: "What kind of lot would I design for this?"

BUILDER: "Probably fat fronts and skinny backs."

The builder continues, launching into a technical explanation about embodied carbon and innovative materials that I can barely follow, before concluding:

BUILDER: "If we want to get those grants from Mr. C (a Mark Carney nickname already 🤣) and those Liberals, we need to be the most innovative to make it to the top of the list!"

[me thinking…Mr C wants to spend $26 billion…it would probably be OK to be 5th on the list and have a rectangular house] 

And therein lies the problem. Innovation driven by grant criteria rather than market realities rarely ends well.

The Lesson: Pragmatic Innovation

If we're going to hit anything close to Calgary's share of that 500,000 housing start goal, we need innovation that serves a purpose—not innovation that serves an image.

What we need:

• Standardized designs that can be replicated efficiently (CMHC housing catalogue x100)

• Prefabrication systems that reduce on-site labour requirements

• Approval processes that don't require reinventing the wheel for each project

• Supply chains that can reliably deliver materials at predictable costs

What we don't need:

• Houses shaped like letters of the alphabet

• Exotic materials with unproven durability

• Over-engineered solutions to problems buyers don't have

• "Sustainability features" that drive up costs without delivering tangible benefits

Let's keep it simple: four walls, efficient and proven HVAC layouts, windows we've been making for two decades. Innovations that help us build more homes, faster, at costs people can afford—that's the kind of innovation worth pursuing.

The housing crisis won't be solved with T-shaped houses and countertops from Milan. It will be solved by building more of what works, more efficiently, at greater scale.

Sometimes the most innovative thing we can do is resist the urge to innovate where it doesn't matter.

🛠️ The Art of Making Sh*t Up (with AI…responsibly)

Look, we’ve all done it.

You’ve got a piece of land in a new town—Town A. It looks promising. You’re 80% sure you want to move forward. But you’re still missing something crucial: a cost estimate for servicing.

You could call an engineer and wait three weeks for a ballpark number padded with two layers of liability. Or… you could do what any self-respecting, spreadsheet-wielding land developer does: extrapolate from places you already know.

Here’s how this played out for me recently:

• I’m building in Town A, a new expansion town with no existing cost benchmarks.

• I had partial costs from Town B, which is right next door and shares similar soils, servicing standards, and general vibes (← yes, vibes is a development term 😁).

• And I’ve got an entire cost bible from Town C, where I do most of my work—but it’s far enough away that I can’t just copy-paste without raising an eyebrow.

So what did I do?

I created a Frankenstein Estimate^TM using AI.

I used Gemini Flash, but ChatGPT or Claude would work equally as well (…or as badly, depending on how you look at this whole endeavour). 

Some costs came straight from Town B.

The rest were interpolated by comparing Town B and C line items, calculating ratios, and applying those ratios to Town C costs to estimate the missing ones for Town B—then assigning that patched-together profile to Town A.

It's Class C budgeting at its finest: defensible, directional, and dangerous only if you pretend it’s gospel.

🧠 The Prompt: Estimating Land Servicing Costs Using Regional Proxies

📎 Required Attachments:

• ✅ Town B Estimate (PDF, spreadsheet, or structured table)

• ✅ Town C Estimate (ideally with unit costs and categories clearly labelled)

📎 Suggested Attachments (for improved accuracy):

• 🚧 Road cross-sections (residential, collector, etc.)

• 🕳️ Typical trench depths and utility profiles

• 📐 Site layout or phasing plan

• 🧱 Soil report or geotech assumptions

• 🧾 Local servicing standards or specifications

💼 Other Developer Use Cases for Interpolated Prompting (ODUCFIP for short)

This prompt structure isn’t just good for site servicing. It’s great for any developer task where:

• You have partial data in the market you’re in

• You have full data in a nearby or familiar market

• You want to bridge the gap intelligently, rather than guessing or overengineering it

For example:

• New municipality, same housing product → Use known construction costs and adjust by labour/material index

• Phase 1 is done, Phase 2 is uphill and rockier → Adjust earthworks using slope and subgrade multipliers

• You’re going to a new province → Use utility servicing costs from home base, indexed to new regional labour and utility hookup standards (← I am very guilty of this one early in my career)

This prompt structure turns Gemini (or GPT, or Claude, or GROK) into your Cross-Town Estimator^TM .

And then…not two minutes after finishing writing this last section (on Wednesday), I noticed this tasty post on LinkedIn:

I DMed the prompt to her…no response yet…

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Cheers,

- Greg

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