Brandon Donnelly

Daily insights for city builders, delivered every morning at 6 AM ET. I’m Brandon Donnelly — a Toronto-based real estate developer and founder of Globizen. I’ve been writing here since 2013.

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Tag: toronto city council

  • Toronto approves new Rental Housing Supply Program

    This past week, Toronto City Council approved the launch of a new affordable housing initiative called the Rental Housing Supply Program. Here’s the agenda item if you’d like to dive into the details and read some of the supporting reports. There are a number of components to the program, and one of them is a subsidy that will be administered by way of a forgivable interest-free loan:

    Subject to the adoption of the Rental Housing Supply Program, the City will continue to support RGI and affordable rental homes through the allocation of up to $260,000 per eligible affordable rental and RGI home. This is the maximum allowable funding allocation under the Rental Housing Supply Program. Actual funding per project will be determined based on the evaluation of applications on a site-by-site basis, in consultation with the Chief Financial Officer & Treasurer, and based on project parameters and additional sources of funding that can be leveraged to support the project’s financial viability. These funds will be provided as interest free forgivable loans to eligible and approved projects and will be tied to milestones and requirements in agreements with housing providers.

    Total funding for the program is $351 million. And the intent is that these funds will be distributed in the near term to 18 affordable housing projects in the city, all of which are expected to start construction sometime between now and the end of 2025. In total, this is anticipated to create about 6,000 new affordable rental homes. That’s a good thing.

    Now, I don’t know anything about these projects. I don’t know if $260k is the right figure. And I don’t know if a forgivable interest-free loan is the exact right mechanism to deliver these funds. But what the program does do is recognize this: Deeply affordable housing cannot be built without some form of subsidy.

    Developers are often criticized for only building expensive housing. But the reality is that developers are, for the most part, takers of market pricing. In other words, we can’t just decide to build for less. We can reduce build and finish quality to get costs down, but at a certain point, the cost to build is the cost to build.

    And if that cost to build isn’t what the market would view as affordable, then you’re not going to get there without a subsidy. No developer is going to build if their expected revenues are less than their costs. Directionally, that’s what this new program appears to recognize.

  • Should rooming houses be allowed across the city?

    One of the debates I came across on Twitter this week was about multi-tenant houses (also known as rooming houses) in Toronto. Currently, they are allowed in the former city of Toronto, parts of Etobicoke, and in York. But they are illegal everywhere else in the city.

    The reason why the rules differ is simply because they weren’t harmonized following amalgamation in 1998. And so right now we are debating whether or not things should be changed so that multi-tenant houses are permissible across the city.

    As you can probably guess, it’s a divisive issue.

    The more urban councillors believe that rooming houses are vital because of their relative affordability. The more suburban councillors are, on the other hand, speaking for their constituents and saying that homeowners really don’t want them in their communities. It’s about “protecting the integrity of single-family communities.”

    No surprise here.

    For this reason, a recent vote on the issue was deferred. It’s expected to come back to council in September. Maybe there will be more support at that time. Or maybe there won’t be. Either way, rooming houses will continue to exist all across the city. Some of them may just be illegal.

    If I had any say in the matter, I would vote “yes.”

  • Toronto to market 11 city-owned sites for new affordable rental housing

    At the end of last month, Toronto City Council adopted the “Housing Now” action plan. The first phase of the plan involves the public marketing of 11 city-owned sites for the purpose of finding non-profit and private sector partners to help redevelop the lands with new mixed-income housing. It is expected that these lands could accommodate about 10,000 homes.

    Here is the list of sites:

    As part of the offering, around 2/3 of the built units will need to be rental (the above chart shows more), and of these rental units, 50% will need to be affordable with rents set to 80% of Toronto’s average market rents. All of this should translate into approximately 3,700 new affordable homes. (Mayor Tory’s plan is to build 40,000 affordable rental homes by 2030.)

    The City wants to ultimately retain ownership of these lands, and so the sites will be offered up through long-term land leases. It looks like they’ll be for 99 years. The City will also be forgiving a number of fees and levies for the 3,700 affordable homes. They are pegging the PV (present value) of these development incentives at just over $280 million:

    Making use of surplus public land to increase the supply of affordable housing certainly makes a lot of sense. But there’s a cost burden associated with these affordable units, which is why discussions around inclusionary zoning often come back to offsetting measures. Who is going to pay for these subsidies?

    The above “financial incentives” — which in this case are simply foregone revenue — speak to this cost burden.

    Tables: City of Toronto

  • Politics and bike lanes

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    Recently a good friend of mine told me that I had conflicting views in the world of politics.

    She more or less said to me: I know you’re a real estate developer and obviously a capitalist (read: right of center), but you also support what are often considered to be left of center issues. Issues like tearing down the Gardiner Expressway and building more bike lanes.

    I thought this was an interesting comment because, regardless of whether or not you agree with the categorization she was making, the unfortunate reality is that sometimes (oftentimes?) city building issues do become about left vs. right. Bike vs. cars. Urban vs. suburban. And the list goes on.

    My response to her was that I don’t care about what side of the political spectrum an issue supposedly falls on. That’s a distraction. When I think about something, I try and apply rationale thought and facts to the best that I can. 

    For instance, in the case of bike lanes, I have asked myself: would cities be better off if we had more, or less, people cycling? Simple question. And when I think about this and look at some of the numbers, I see a lot of benefits (this is a non-exhaustive list):

    – More people cycling means we’re moving people more efficiently, which you could argue improves urban productivity and overall quality of life. 

    – More people cycling means we will naturally start prioritizing more compact types of urban form, which in itself has a myriad of socioeconomic benefits. 

    – More people cycling means we’re actually taking action to try and fight climate change.

    – And more people cycling means we’re improving health outcomes. Given that public spending on health care is one of the largest government expenditures in OECD countries, I bet you could find measurable financial savings.

    With all of this, I am not naively suggesting that all cars should disappear from our cities and that everyone should only cycle. I think electric vehicles and self-driving vehicles are going to be an important part of the mobility equation in the future. But I am saying that more, not less, cycling strikes me as an obviously positive thing for our cities. 

    On that note…

    Toronto City Council voted today in favor (38-3) of a pilot project that will bring separated bike lanes to Bloor Street. The image at the top of this post is how each Councillor voted. So today, we appear to have not fallen into the divide that my friend was talking about. And that makes me, as well as many others, quite happy.

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    I would be curious how all of you feel about this particular issue. And I would also be curious if you find yourself being more issued based rather than aligned across the political spectrum. That’s certainly how I feel these days.

    I bet we could have a great discussion on this topic in the comment section below 🙂

  • A petition to Toronto City Council to remove the Gardiner Expressway East

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    “If the decision ultimately of the council is to support the hybrid I think frankly it’ll be a major step backwards and you’re going to miss a once in a lifetime opportunity, and I’ll be very frank, we’ll be the laughingstock of the world.” 

    -Paul Bedford, former chief planner of Toronto

    As many of you I’m sure know, I have been a vocal and passionate supporter of removing the eastern portion of the elevated Gardiner Expressway in downtown Toronto. I have written about it so many times that a lot of you are probably sick of hearing about it.

    I’m sorry if that’s the case. But it’s a hot and important topic in Toronto right now. We’re just over 3 weeks away from City Council finally making a decision. That is scheduled to happen on June 9th and/or 10th. 

    For the most part though, I was pretty confident that we would ultimately make what many of us believe is the right decision. But then this past week Mayor John Tory went public in his support for the “hybrid” option, which is basically to rebuild the elevated expressway in a slightly different configuration. And that really upset me.

    Here’s what that looks like (versus the remove option shown at the top of this post):

    image

    Have we learned nothing from our past city building mistakes?

    Since that announcement, I went on Twitter every night this week to check out the discussions that were happening around #GardinerEast. And every night it got me so worked up that I then had trouble falling asleep. I have since stopped reading about the Gardiner East before bed.

    But rather than just get frustrated, my friend (a fellow city builder named Stephen Job) and I decided to do something about it and create a petition using Change.org.

    It is a petition that we will ultimately be sending to Toronto’s entire City Council prior to their June 9 meeting and we hope that you will consider signing it and sharing it with your network – regardless of whether or not you happen to live in Toronto. (Although it’ll certainly help if you’re a taxpayer and voter in the City of Toronto.)

    We just finished getting it up and you can check it out and sign it by clicking here.

    Images: Toronto Star