Urbantopia-a cross between Brooklyn and Florence. Sixteen years from now, if you believe the brochure, that's what this muddy plain in Markham, Ontario, will become. For now, though, Canada's largest development is marked by construction cranes, the concrete shells of three rising towers, and a posse of real estate agents camped out in lawn chairs. In the parking lot beside the grand sales office for Downtown Markham, the agents' black BMWs and silver Lexus SUVs are being coated with dust by the passing cement trucks, but no one seems concerned. A couple of months from now, markets will plunge and real estate prices will stall, but for now, these agents are prepared to stay here for days, until units in the fifth Downtown Markham condo tower go on the market, ranging in price from $179,900 to $440,900.
Local agent Anissa Wong is buying a one-bedroom condo for one of her young clients, and the demand doesn't faze her. "They had one-week lineups for College Park 3," says Wong, name-dropping a wildly popular condo project that went on sale in downtown Toronto last year. "And here, the prices are cheaper than downtown. It's going to be very green, very different from downtown. Maybe you want to buy one?"
Markham has never seen anything like this-the sort of buying frenzy typical of overheated markets in downtown Toronto or Vancouver, where young professionals are desperate to carve out a place in the city centre. Just a generation ago, the suburb northeast of Toronto was a string of rural villages. Today, it is Canada's fastest-growing municipality, a sprawling collection of cookie-cutter subdivisions, shopping malls and big-box power centres.
Downtown Markham's developer, the Remington Group Inc., aims to reshape the suburbs, and it's betting billions of dollars that urban communities are the way of the future. When the project is completed, some time around 2025, it will house more than 10,000 people in a mix of townhouse blocks and condo towers, and employ 16,000 people in almost four million square feet of pedestrian-friendly retail and office space. There will be acres of parkland and a large central piazza. To top it off, the entire project-by far the largest mixed-use development in the country-will adhere to the gold standard for Leadership in Energy and Environmental Design (LEED).
The man behind Downtown Markham is Rudy Bratty. He's the prolific developer who, over the past 50 years, has turned his father's small building operation into a real estate empire worth over $1 billion (Bratty's personal fortune has been pegged at around $750 million). He's also the man largely responsible for transforming thousands of acres of farmland around Toronto, including much of Markham and one massive, 4,600-acre tract in Mississauga, into curvy streets packed with mass-produced, single-family homes. All told, tens of thousands of people live in Bratty's developments.
But the business is facing new challenges. Yesterday's supply of empty farmland and anything-goes municipal councils are gone; today, places like Markham-with a push from the province-are looking more and more like cities. There's a political consensus that, if we're going to house the 100,000 or so newcomers who flock to Ontario each year, we have no choice but to build denser, mixed-use communities like Downtown Markham. And Bratty is leading the charge. "The rules of the game," Bratty says, his voice shifting from its customary boom into a lawyerly cadence, "have changed totally."
Just as 76-year-old Bratty is making the transition from one type of development to another, his company is going through a transition, as well. His tightly knit crew of four sons-Matthew, Chris, Mark and Michael-are taking on a larger role in Remington. Which makes this a critical moment for the family and for the business. Bratty is determined that Remington remain a family operation. But like other companies in the sector, it faces two big questions: Can they change the way they do business? And can the next generation fill the patriarch's shoes?
At six-foot-something, with a bullet-smooth head, a lineman's build and an excellent pinstriped suit, Rudy Bratty towers over the conference table at Remington's headquarters in Vaughan, another Toronto suburb that bears his imprint. He is flanked by his sons Chris and Matthew, both of whom run divisions within Remington. On the wall above them hangs a black-and-white photograph of Bratty's father, Donato, a cigarette hanging jauntily from his mouth. One of 14 children born to a farming family in Italy's northeastern Friuli region, Donato moved to Canada in 1921. A 21-year-old bricklayer with a Grade 2 education, he settled down with a local Italian-Canadian girl and had two children. "He was a typical Italian immigrant who enjoyed a glass of wine, family, honesty, hard work and playing bocce," Bratty says of his father.
Donato built a solid foundation for his son, the future tycoon. During the Depression, he went into business with a friend, building a few houses on Toronto's suburban edges. By the 1950s, business was steady enough that the Brattys moved from a working-class area to the upper-middle-class neighbourhood of Forest Hill. There, in grade school, Rudy hooked up with a group of other future multimillionaires: developer Angelo DelZotto (now chairman of Tridel), investor Lionel Schipper and Four Seasons Hotels founder Isadore Sharp. "We grew up very close, going in and out of each other's homes," says Sharp, whose father was a plasterer-turned-builder from Poland. "The parents knew you almost like a second child."
As a young man, Bratty was a cheerful Type A, athletic and outgoing, with curly black hair. Sharp remembers a road trip the pair took to California, where a man claiming to be a movie agent tried to whisk teenaged Bratty off to Hollywood. "He was practising his singing in the car all the way home," Sharp recalls with a laugh.
Bratty's aggressive business sense showed up early. At 17, he and DelZotto, along with a Bratty cousin, built six houses in the suburb of North York. "We did the shingles on the roof, everything," says Bratty, who trained as a carpenter when he was still a teenager and worked with his dad. "We sold them in one-half hour on a Saturday afternoon, and I never felt so rich in my life." The boys reinvested their $12,000 take and kept going. "We bought 18 lots, then we bought 30 lots," Bratty recalls. "Our fathers were worried sick. They were building two, three houses a year. That's the background we came from-my father started with nothing, and therefore he was very cautious."
Bratty would have been content to keep on building. "But my dad insisted I go to school," he says. So, in 1950, Bratty enrolled in the arts program at the University of Toronto, then went on to Osgoode Law School, paying his way-and then some-as a builder over the summers. When he graduated in 1957, he and a lawyer friend, Emilio Gambin, set up their own firm in Toronto. "I'll bring in the work," Bratty told his partner, "and you do it." Their timing was perfect. Instead of having to hunt down clients, the local community of Italian builders flooded the young firm with more work than it could handle. "We got the next generation," Bratty says. "They were looking for young, Italian lawyers to represent them. And we were fortunate to know many of them through the families. They grew like crazy, and we grew like crazy. And I was always involved, through advice or through participation of some sort, in real estate."
By 1964, when Bratty married a young model named Cathie Sinclair (she was 21, he in his early 30s), he had formed a loose partnership with two of his early clients: Marco Muzzo and Alfredo (Fred) DeGasperis, Italian immigrants who'd arrived in Toronto in the late '50s. For the next four decades, the Bratty-Muzzo-DeGasperis triumvirate would dominate development in Toronto's suburbs, starting with Markham, Vaughan and Brampton. In the early 1970s, before some of these areas had even established major sewer systems, they began buying up thousands of acres of prime land. "They saw it ahead of time," says Don Cousens, a long-time local politician who was Markham's mayor from 1994 to 2006. "They could see future potential there, and they had the resources and commitment to plan 10 or 20 years ahead."
The trio built houses and reinvested the profits, maintaining the pattern Bratty had established as a teenager. The result: They bought land widely and cheaply before other developers came calling, building up both inventory and cash that their competitors had trouble matching. "They were the smart guys," says one former Vaughan politician. "They didn't bank their money. They banked it in land." Today, Bratty says he still owns property he bought 40 or 50 years ago. "There's no doubt that I've always had an appetite for land," he says. "As I always say, it never talks back to you, and only God knows how to make more of it."
Until the 1980s, the development game was relatively simple. Municipalities around the GTA were eager to enlarge their property-tax base and thousands of young families were on the hunt for affordable housing-and developers were only too happy to oblige. Bratty sums up the planning ethos of those years: "You put in as many lots as you can, a shopping centre here, a school here and a park here," he says, waving one of his long hands.
Working on a handshake basis, Muzzo and DeGasperis moved fast. "A deal would come through and be presented to Marc and I and Rudy," 74-year-old DeGasperis remembers, "and each would make a decision about whether he wanted to become a partner. No board meetings-very simple. It's very hard for you to understand how simple it was."
The three shared a ferocious work ethic. DeGasperis, who came to Canada at age 18, was a dealmaker with strong connections to various trades. As for Muzzo, who died in 2005 at age 73, "he was very bombastic, very domineering," recalls Bratty. Though their exact roles shifted from deal to deal, the three partners built on the efficiencies of their related businesses. DeGasperis's sewer and water-main contracting company, Con-Drain, supplied the infrastructure for their projects, and Muzzo's drywall business, Marel Contracting, helped finish the houses. Bratty's job was to acquire the actual land and deal with the legal and political issues around getting it developed. In truth, it wasn't all that difficult. In fast-growing suburbs like Markham, says Cousens, the zoning was "wide open." Even so, Muzzo and DeGasperis maintained a fair but insistent line while negotiating their own projects with local officials. Their approach when disputes arose, according to one local politician, was: "If you guys don't like it, we'll take it to the Board"-as in the Ontario Municipal Board, a notoriously developer-friendly agency that can overrule local planning decisions.
That wasn't Bratty's style. "If it didn't work for the municipality, we never really fought it," Bratty says. "I would sit down with the local politicians and the local staff, and we would either wait or change it."
His bids were supported by impeccable connections with both Tory and Liberal provincial politicians. Bratty sat on numerous corporate boards, including Canada Trust, Petro-Canada and the Toronto Sun Publishing Corp. (he teamed up with onetime Sun publisher and CEO Paul Godfrey back in 1989 to try to bring an NFL team to Toronto). And he and Cathie (a member of an elite society clique known as "the Glitter Girls" who is notorious for over-the-top outfits and jewellery) were regular fixtures on the charity-ball circuit.
Most importantly, Bratty knew better than anyone how to work the system to his advantage-for instance, commissioning his own environmental studies that helped persuade planners that his land was ripe for infrastructure, and tracking planning decisions among all three levels of government. "Small developers probably don't have the staff, the organization, to keep track of all these agencies," says a long-time consultant. "A lot of those developers were guys working out of the trunk of a car. Bratty's organization, DeGasperis's organization, they're plugged in everywhere. Why? They've got the resources to do it."
That also meant plenty of quid pro quo. Developers would invest in services or infrastructure in exchange for the right to build. Such deals were and are common in fast-growing towns, and Bratty and company were happy to play ball. "There weren't a lot of development charges," Cousens says. "So if you wanted a new community centre, you'd go to Mr. Bratty or Mr. DeGasperis, and they'd donate the land and a large part of the money. That was their payback. They were willing to make that kind of participation."
Meanwhile, their much smaller rivals grumbled about unfair practices. During a judicial inquiry into the construction industry launched by the government of Ontario in the early 1970s, Muzzo testified that paying bribes was standard practice-though he claimed he wasn't positive just what he was paying for. Bratty was never implicated in any wrongdoing, and in 1988, when The Globe and Mail conducted its own investigation into the trio, he had this to say: "Certainly, I can understand other people being jealous and complaining. And certainly I can understand some guy who owns land north, south or east of us who doesn't get the same thing saying, 'Darn it, there's some skulduggery going on.' I can only say to you one thing: I know of no skulduggery and I have not been involved in any skulduggery."
As the real estate boom came to an end in the late '80s, Bratty realized that his long-time MO-"buying acreage and creating lots"-would no longer be profitable as land got more expensive. So, the Brattys, led by Rudy's sons, ventured into actually building houses, as well. "We started with six houses," Chris remembers. "It's very similar to the way my dad began." Except, he acknowledges with a laugh, Rudy sold them the suburban lots to build them on.
Remington made it through the downturn with money-and land-to spare. For a while, development continued much the way it had back in the '70s. "All we do is respond to the market, and in the market at that time, single-family was the champion," Bratty explains. "A single-family home, white picket fence, a 50-foot-lot, a two-car garage; the husband works, the wife works part-time, two or three kids, and goodbye Charlie. Everyone's happy."
But it couldn't last, and during the real estate lull in the late 1990s, Bratty discovered the future of development.
Two decades ago, a mixed-use suburban development like Downtown Markham-one combining retail, residential and office space-would have been nearly impossible to sell. Even as light industry moved to the suburbs, condo towers were virtually non-existent. After all, the whole idea of living in Mississauga or Markham or Richmond Hill was to have a driveway, a big backyard-a buffer between you and the city.
But the peaceful era of picket fences here was grinding to a halt. The success of Bratty, his partners and competitors came back to haunt them: As people and commerce spread away from the centre, commuting became a nightmare and even happy suburbanites started calling for "smart growth."
Density, sustainability and walkability became the new buzzwords in the 1990s, and the idea of turning former bedroom communities like Markham into diverse, self-sustaining cities in their own right began to take shape. It took a while before laws like Ontario's 2005 Places to Grow Act started to enforce these ideas.
The Brattys found themselves on the leading edge almost by accident. Markham's then-mayor, Don Cousens, approached Remington in the mid-'90s about building a high-density community that would act as a town centre for the sprawling municipality. The developer was skeptical. "Cousens came to us and said, 'We want to do all the buzzwords,'" Bratty recalls. "We didn't think it was going to work, to be honest with you."
Cousens and the rest of Markham's municipal council had been inspired by the idea of the "lifestyle centre," an offshoot of the New Urbanist movement (a set of ideas that originated primarily with Miami planners Andrés Duany and Elizabeth Plater-Zyberk and is epitomized by the theme-park-like town of Seaside, Florida, where The Truman Show was set). Generally located in an affluent American suburb, the lifestyle centre combines retail, residential and office space on pretentiously urban "streets" studded with restaurants and cultural activity. The inevitable cars are hidden in garages on the fringes.
Cousens was convinced that a 243-acre chunk of land Bratty owned in Markham was the best place to create that sort of community. It paralleled the main local artery, Highway 407, and was next to a GO commuter rail station. "My job became one of convincing Rudy Bratty," the ex-mayor says.
Originally, that piece of land had been slated for a typical Bratty-style development: 500 single-family homes on curvy streets, with a few factories toward the edge of the 407. "That would have been that, and on to other things," Bratty says. But a slow real estate market held up the development, and he figured Cousens's pitch was worth looking at.
Bratty, along with local politicians and town staff, travelled to sites across the U.S. to see the lifestyle centre in action. And with a team of top consultants, Bratty developed the ambitious plan for Downtown Markham. In the development's largely residential west end, townhouse blocks would be interspersed with dozens of condo towers, a central park and schools. A tributary of the Rouge River would become parkland along the edges and through the middle of the area. Five distinct precincts would make up the commercial heart of the area and provide employment: the Montgomery High Street retail district; the Gallery, a semi-enclosed shopping arcade; the Simcoe Promenade; the Piazza, a large central square; and the Commercial District (which already includes new headquarters for Motorola Canada and Honeywell Canada). All of these "public" spaces would be owned by Remington.
So far, there's nothing comparable in Canada, though a few similar developments are under construction, including one in B.C's Lower Mainland and one in Mississauga. They're dwarfed by Downtown Markham, though, and with its large piazza and genuine office presence, Bratty's development is likely to be denser, busier, more genuinely city-like.
As an added draw for wannabe urbanites, the buildings are being designed to LEED standards. Among other things, condo and office buildings will be heated and cooled by water pumped through a community-wide system of pipes. And while Rudy Bratty doesn't seem quite sure what LEED stands for-he calls it "leads" during our interview-he and the company are singing a new tune (if a bit awkwardly: "We became involved with the environment," he says).
So far, the residential part of the development has been a hit, even as condo sales slow amid the economic slump. The first two condo buildings sold out within a day, and sale prices have been solidly 10% to 20% above the local average: between $340 and $350 a square foot, or about $350,000 for a 1,000-square-foot apartment. "We expected it to be successful," Bratty says. "We didn't expect people to line up outside." Drawing in commercial and retail tenants has been a much tougher sell. Chris Bratty says it's hard for many store owners to imagine not having a big parking lot out front. Commercial offices have also been much slower-and that was even before the dreaded "R" word crept into the news. For his part, Bratty claims to be more or less unfazed by the current slowdown. "Sure, the sales will not be as aggressive as we anticipated," he says, "but we are moving forward with the project." The current townhouse and mid-rise condos, with just over 1,000 units total, are now 95% sold, he says, and construction continues. He does admit, however, that plans to build more office space will likely be axed. For the moment, a 350,000-square-foot phase, including a grocery store and a movie theatre, is still slated for completion in 2011.
Downtown Markham could even grow, seeing as local and regional planners (backed by the province) consider Markham to be a prime site for denser development. "I wouldn't be surprised if the project actually doubled in size-at least the residential part," Rudy says, which would push back the completion date, and potentially mean more ups and downs. "I've experienced downturns at the top of each decade," he says, "and in 2000 that didn't happen; we didn't get the turn until 2008. We figure we'll go through a couple more of these before it's finished."
The mastermind behind Downtown Markham may not be around to see that. After all, 2025 is a long way away.
That's where the next generation comes in. "The boys," as Bratty calls them, all have leadership roles in the family enterprise. Chris, 41, heads Remington's land development division. The eldest son, Matthew, 43, heads the low-rise housing division. Mike, the youngest, at 39, oversees Remington's recently formed high-rise division and its commercial properties (along with his Uncle Jerry). And Mark Bratty, 42, oversees "special projects," Rudy says, which includes a tile-supply business.
The five Brattys meet at the end of every business day to compare notes. And every Sunday, the entire clan gathers for dinner at the modest bungalow in Etobicoke that Donato built in 1967 and where Rudy raised his family (though he says he and Cathie are now building a massive home in the suburbs).
Chris says their closeness will help them overcome the hurdles that often trip up family businesses. "We have a common goal, which is to stay together," he says. "We're a very tight-knit family."
For now, their work is all coming together in Downtown Markham. But Rudy "is definitely hands-on," Mike says. "We have the luxury where he relies on us to look at the details-but he's here all day Saturday. I definitely go over every document with him."
This is deliberate, Rudy says: Remington is no longer a one-man operation at the top. But Chris will clearly be the next leader. Today, he functions as chief operating officer, and he talks earnestly about the benefits of LEED, the future of suburban retail, and why mixed-use communities are the future of development. In other words, Rudy has set the course that his kids will follow for the next two decades. Which makes sense: In today's development world, Rudy says, "what we used to do in six months takes six years." And he's confident that the Downtown Markham properties will continue to command a premium-and generate substantial profits.
But will he quit? The transition, Chris says, could take a while. "He's the consummate workaholic. He doesn't ever stop."
Rudy doesn't argue with that: When asked whether he's planning to retire, the patriarch just bursts out laughing. "I like living too much," he says. "I'm convinced that if you want to shorten your life, you quit work. I'm 76, and there's no way I'm stopping."