Item - 2022.EX29.4

The Executive Committee:

1. Referred Item EX29.4 to the Deputy City Manager, Infrastructure and Development Services for further consideration.

In April 2021, the Province announced a Transit Oriented Communities commercial partnership with Cadillac Fairview for the East Harbour site. The Transit Oriented Communities partnership proposes to add 302,000 square metres (3.25 million square feet) of residential development, or approximately 4,300 residential units, to the 926,000 square metres (10 million square feet) of employment development previously approved in the Unilever Precinct Secondary Plan and relevant Zoning By-laws.  Materials submitted by Cadillac Fairview in May 2021 propose nine residential towers, nine office towers, and a street network similar to the 2018 East Harbour Master Plan.  As part of the commercial agreement between Cadillac Fairview and the Province, the two parties negotiated a capital contribution toward matters they expected the City would require for the East Harbour site, including affordable housing, community services and facilities, and hard infrastructure.

The Province is targeting Spring 2022 to issue a Minister's Zoning Order to provide zoning certainty for this Transit Oriented Communities development.  The Province has indicated that this timeline is linked to the construction timelines for the East Harbour Transit Hub, which includes station platforms for the Ontario Line and SmartTrack.

In July 2021, City Council provided direction to staff confirming the City's objectives and priorities for negotiation with the Province and Cadillac Fairview.  City staff have engaged with the Province and Cadillac Fairview based on these objectives, which include the objectives and policies in the Council approved Unilever Precinct Secondary Plan.  Negotiations have dealt only with matters deemed necessary to conclude the Province's TOC commercial transaction and ensure essential City interests are addressed by the Province and Cadillac Fairview.  It is understood that subsequent reviews and approvals will be required given the scale and complexity of the proposal, and the time and engagement required to advance a well-considered plan. 

This report reviews the Revised Master Plan for East Harbour and outlines the principles and positions City staff have advanced in the negotiation process with the Province and Cadillac Fairview.  Negotiations were ongoing at the time this report was written. 

The City's fundamental goal is to protect East Harbour as a major employment area on the east "shoulder" of the Downtown.  If residential uses are to be permitted at East Harbour through the Ministerial Zoning Order then the Transit Oriented Communities proposal must ensure the core parameters for a complete mixed-use community, while protecting this major office function and employment uses within the broader South of Eastern Employment Area.  The Province has stated its goal to develop East Harbour as a major employment area and has indicated its agreement with these parameters.  Retention of East Harbour as core employment and securing the development of office uses in tandem with residential uses is critical to both ensuring employment uses are predominate on site and preventing further conversions in the broader South of Eastern Employment Area, which plays a key role in supporting the film industry in the City.    

Staff are anticipating that a supplementary report to Executive Committee or Council will summarize the negotiated conditions proposed by City staff, including financial terms to address City interests related to the East Harbour Revised Master Plan Transit Oriented Communities proposal.  It is critical that negotiated terms are secured in a manner that protects the City's interests.  

The partnership between the City and the Province on the development of the East Harbour Transit Hub and SmartTrack station, as well as the significant scale, complex enabling infrastructure, unique partnerships and development timing of the East Harbour Transit Oriented Communities proposal distinguish it from other Transit Oriented Communities sites.  East Harbour is a 15 hectare brownfield site that forms a significant portion of the 25 hectare Unilever Precinct, with multiple development blocks and new public streets and parks to be delivered throughout the site.  In addition, East Harbour is also subject to a draft plan of subdivision process.  By comparison, other Transit Oriented Communities proposals in the City of Toronto will see redevelopment of predominately individual parcels within the existing urban structure of streets, blocks, and related infrastructure, with developer partners to be secured after the development permissions are established and through an open market offering process.

The East Harbour Transit Oriented Communities proposal also incorporates an extensive enabling infrastructure program.  As a brownfield site within an existing floodplain, the East Harbour site requires many infrastructure investments, including flood protection landforms, streets, transit, and underground servicing; all with the appropriate approvals and securities necessary to unlock its full City building and development potential.

A supplementary report to Executive Committee or City Council will detail the outcomes of negotiations for East Harbour and will bring forward recommendations for City Council consideration.

This supplementary report provides additional information regarding ongoing negotiations between the City of Toronto, the Province of Ontario and Cadillac Fairview related to the East Harbour Transit Oriented Community's (TOC) proposal.  The significant scale of development and enabling infrastructure proposed in the vicinity of East Harbour requires thoughtful consideration by all parties, and negotiations are continuing. 

The attached letter from Infrastructure Ontario, dated January 22, 2022, provides an indication of Provincial views on the general direction that an agreement on East Harbour is expected to take, and the areas where the Province and the City have shared objectives.  As noted in the attached letter, the Province shares the City's interest in ensuring that the development of East Harbour unfolds in an appropriate manner, and with regard to sound planning principles and the many elements that comprise a complete community. 

Negotiations continue related to the implementation and cost-sharing of enabling infrastructure,  phasing and the advancement of office development at East Harbour, confirming an approach to affordable housing, community services and facilities, and parkland, and establishing high level principles to guide future planning for the development, including the treatment of East Harbour's industrial heritage. 

City staff will bring forward a report to Executive Committee in March 2022 on the key terms and a financial impact assessment for the East Harbour TOC arising from the ongoing negotiation. City staff will seek Council consideration at that time of the negotiated terms and related conditions.