Tariffs, high interest rates and protracted development red tape are among the hurdles developers face to bring life to urgently-needed housing projects in Toronto and across Canada.
But if various government levels and development sectors work together to problem solve, there will be “some real movement and real uniting” to help overcome barriers to getting shovels in the ground, says Robyn Brown, principal and practice group manager for placemaking at Arcadis Canada East.
Brown, who moderated a panel session about how transportation and infrastructure planning can impact the commercial real estate world at the Land and Development Conference recently in Toronto, says while times are difficult in the development industry, it is “a time of great innovation and opportunity.”
She says a tagline at the end of the seminar was “never waste a good crisis.”
The development community is hopeful governments are thinking the same way.
The federal government has initiatives in the pipeline to accelerate housing construction and a number of municipalities are looking to reduce development charges and expedite permitting.
As it stands, however, many developers find delivering most types of products, especially residential, to market is “exceptionally difficult,” says seminar panellist Meghan Wong, vice-president of the Spanier Group, a real estate and planning firm specializing in large-scale, mixed-use developments.
“I think most development sites, especially the large mixed-use ones, have trouble pencilling in this market.”
While the province’s investment in transit is unprecedented and property next to or near busy transit stations are seen as prime residential development points in Toronto, she says the economics of building housing along many of those transit nodes remains challenging.
One possible housing success story is the Gerrard-Carlaw North Transit-Oriented Community, a proposed high-density enclave that will be developed at one of the Ontario Line stations now under construction in the east end of the city. The property was home to an underused strip shopping centre and large parking lot.
The East Harbour Transit Hub, which started construction this summer, could be another bright spot. Also on the province’s 15.6 kilometre Ontario Line, the transit hub is central to Toronto’s ambitious East Harbour project, a high-density mixed-use office/residential community planned east of the Don Valley Parkway near the lakeshore.
The 60-acre former industrial property, however, faces hurdles to unleashing its full potential, says Wong.
Along with the transit line, it will require additional infrastructure such as roads, flood protection and possibly a TTC streetcar extension, all of which could be “cost prohibitive in this market,” she points out.
Wong and Brown also point to a number of sites along the Golden Mile, a stretch of Eglinton Avenue in Scarborough, which are being revisited by the city as high-potential mixed-use redevelopment sites.
The city is under a lot of pressure to provide housing and it sees the area as “a great opportunity” for future housing, says Brown, adding its early planning work along the Golden Mile sets the city up for what to build when infrastructure is in place.
Wong says the federal government’s Build Canada Homes, new agency aimed at building affordable housing, may face a lot of growing pains.
“Many, including myself, believe there are a lot of challenges to starting a new government agency and it takes time to get right. It might be a long-term strategy but it is certainly not going to turn around our current housing crisis in the short term.”
