The City of Toronto’s formerly maligned Housing Now program was in the spotlight Aug. 9 as the owner and partners celebrated the kickoff of construction of its first project under the banner.
The program was launched in January 2019 with the promise that 10,000 new homes would be built on City-owned lands, one-third of them affordable rental units. But the lack of a single shovel in the ground over four years later made the program the subject of derision during the spring Toronto mayoral byelection campaign.
The inauguration of the first building site at 5207 Dundas St. W. with its planned 725 rental units, combined with two other imminent Housing Now projects that will deliver over 1,000 more rental units, is evidence of the program’s viability, said Vic Gupta, CEO of CreateTO.
“Today was a very significant milestone for the city and for our organization to advance affordable housing. I think it was a great thing,” he said. “I think it’s always been a very viable program. I think it’s an innovative program.
“We had expected this particular project to be commencing around this time, that we would have a groundbreaking, that we knew that the economics worked with a little bit of additional support from the city.”
The Dundas Street project was awarded to the Kilmer Group and Tricon Residential with EllisDon as the builder. Of the 725 units, 218 or 30 per cent will be affordable rental and 507 will be market rental. Rents for the affordable homes will range from 40 per cent to 100 per cent of the average market rent.
The development will include a mix of unit types from one to four bedrooms and there will be retail and community spaces. The builders are targeting Toronto Green Standard Version 3, Tier 3, with zero-carbon certification.
“We have three top-notch city-building members of the development and construction industry, they have worked alongside us the whole way,” said Gupta, noting it’s expected there will soon be an announcement of a district energy plan.
“There is no question that there is kind of unanimity among city council, and governments at all levels, about the importance of advancing affordable housing.”
Other blocks will include the proposed Etobicoke Civic Centre location and a new Toronto Public Library branch.
The development blocks will include at least 2,780 residential homes, 904 of which will be affordable rental homes.
Gupta said the next two Housing Now projects to come onstream will be 50 Wilson Heights Blvd., which is expected to have nearly 1,000 units, and 140 Merton St., which is targeted for several hundred units.
Acknowledging the criticism of the candidates in the recent campaign, Gupta said the first stream of Housing Now projects reflects the strong will of Toronto City Council in getting them off the ground with the desired 30-per-cent affordable target intact.
Construction costs have escalated dramatically since 2019 and the hike in interest rates has forced the city to re-evaluate project financing, he said.
“That made the viability of the program more challenging, because the city also committed that on its own land, it’s going to deliver at least one-third affordable housing,” Gupta said. “At the end of the day, this is all about math. If you don’t toggle your affordability levels down to make up for the shortfall in equity…it makes the project more difficult.”
Gupta explained the city’s housing secretariat had to present a plan to city council explaining if it contributed more to the initial projects, and if the city worked closely with the CMHC, the shortfall could be addressed and the projects could be viable with the affordability kept intact.
“We expect to see groundbreaking on those sites in the coming months. So yeah, we’re really excited,” he said.
Since Housing Now was approved, city council has allocated 21 transit-oriented city-owned sites. Ten of these sites have been re-zoned and market offerings have been completed for six of them.
New Mayor Olivia Chow campaigned on a promise to build 25,000 rental homes on city-owned land in the next eight years. The city’s HousingTO 2020-2030 Action Plan has a target of 40,000 new affordable rental homes.
CreateTO is an agency established by the City of Toronto to manage its portfolio of real estate assets.
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