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Toronto Development Watch: East Harbour​

12/10/2021
East Harbour, the long-dormant project on the Toronto’s east side, has picked up momentum.

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Residents received a flyer from “Engage East Harbour,” branded with the logos of the owner and the province, but not the city government – more on that in a moment. 

The site, a former soap factory, has been closed and dormant for years. It sits on a unique location at the foot of the Don Valley Parkway, the main north-south commuting artery in the metro area. East Harbour is one of 19 provincially designated “employment lands,” designated to avoid the development of residential towers in office, manufacturing and industrial locations.

Yet the new plan shows thousands of units of residential condominiums mixed in with office/retail towers.

A recent article on Urban Toronto noted “In several key ways the current plan is hardly recognizable from the master plan approved three years ago.” Adding 4300 units of residential is the most prominent change (from zero initially), but the renderings clearly indicate taller, denser office buildings as well. 

After the owner went bankrupt in 2009, the space was abandoned, then owned by First Gulf (the commercial arm of home builder Great Gulf) for seven years. It was sold to Cadillac Fairview – the real estate arm of the Ontario Teachers Pension Plan, in 2019. The site has regularly been identified as a future transit location, even receiving signage (since removed) stating it would be a future site of SmartTrack. SmartTrack is Toronto’s star-crossed attempt at transit expansion, which after seven years has yet to yield new train stops. However a recent press release from Metrolinx, the provincial mass transit agency, re-affirmed the location as a planned site of one of the last remaining SmartTrack stations.

The province of Ontario has identified East Harbour as the first “transit-oriented community,” a new designation intended to align residential development with train expansion. This accelerates the approvals process and development (in theory; this is the first case in Ontario).

As many Ontarians have learned recently, the province can unilaterally overrule the city on planning decisions. While “minister’s zoning orders” have existed for decades, they have been used sparingly; prior to 2019 there was roughly one per year. Such orders allow the province to control municipal zoning, and cannot be challenged or appealed by the cities or other bodies (e.g. environmental groups).

In 2020 there were over 30 MZOs, largely devoted to allowing housing development in areas where it was banned due to historic preservation, wetland conservation or employment land designation. The orders have become common enough that there is even a Wikipedia article on the topic, “Ontario Minister’s Zoning Orders Controversy.”

The COVID-19 pandemic legislation in Ontario (“Economic Recovery Act” of 2020, Bill 197) introduced “Enhanced MZOs” which allow even further modification to municipal zoning, specifically relating to housing development. This has been extremely unpopular among conservation groups and farmers; the Ontario Federation of Agriculture publicly objected, as well as Environmental Defense Canada and the Ontario Greenbelt Council. Nonetheless, such MZOs are clearly within the provincial government’s powers, and they have exercised them more regularly than any previous Ontario government.

This leverage puts the city in a bind: if it fails to approve the project, the province can step in. Since the shortage of housing is a crucial issue in Ontario, the city risks bad publicity by holding the line on employment zoning. Conversely, if Toronto capitulates to the pressure, this sets a precedent going forward that zoning designations can easily be re-negotiated. 

There are legitimate concerns about too many condos, and the lack of correspondent infrastructure and funding to support this level of housing intensification. Moreover, there is a zero-sum relationship between housing and employment lands; the Globe and Mail noted in 2018 that “the amount of land zoned purely for employment has shrunk by almost 10 per cent. The key driver of this erosion has been the creeping encroachment of residential development on some of the land protected for employment use only.” 

East Harbour offers a unique opportunity for office employment east of the river. There are adjoining employment lands, but these are largely related to film production and associated businesses such as catering, lighting and truck rental. East Toronto lacks significant  office capacity, with the “general employment areas” such as Carlaw avenue consisting of storefronts such as dentistry, bakeries, daycares and optometrist offices.

At the same time, setting aside land for millions of square feet of office buildings is starting to look less enticing. As the housing crisis becomes more and more acute, and residential prices become increasingly out of reach, the city and province cannot simply do nothing. Using an MZO to place housing on employment lands may ultimately be a case of doing the right thing… with the wrong method. 

East Harbour has been described as a “Union Station of the East,” a new downtown and a transformational project for the less developed side of the city. However, the obstacle is the same as it’s been for over 100 years; the political will to build a large transit expansion. As observers have noted, the concept of a “relief line” through the eastern half of the city dates back at least 50 years, with similar plans even existing in a 1910 draft of the initial Toronto subway plan. The city’s plan from the early 70s includes the same general design, with the line marked with 6 roughly aligning to the current proposal.

Which will come first? The development or the transit? According to Metrolinx, the transit; the plan is to build out the station, then develop the surrounding land once a train stop exists. In practice, adding train stations has become the ultimate political quagmire. While virtually everyone from employers to municipal government leaders to the province itself agree on the need for improved and expanded transit, the cost is still off-putting. 

The Yonge subway has long since reached capacity, and Toronto is expecting record immigration over the next three years. Federal immigration targets are at all-time highs, and the plurality of immigrants settle in the Greater Toronto Area. This would seem to create true urgency, but as an excellent review noted, the line has been a “top priority” for decades (e.g., then new head of the Toronto Transit Commission Andy Byford said the line was his top priority… 10 years ago).

COVID-19 has created an extremely unusual situation, where transit ridership has dropped 90%. To their credit, governments are not being “prisoners of the moment,” and are taking a long-term view; presumably COVID-19 will be long concluded by the time large transit initiatives are completed. Even the most ambitious timelines – which are rarely met for major infrastructure projects – put the opening at least nine years out. At some point Toronto needs more transit and housing, and East Harbour seems to be the signature project that will test the new alignment of transit and provincially imposed mixed use development. 

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