Sold in 2017, Bought in 2018, Approvals in 2019, Build in 2020: A Tale of TO’s Missing Middle

Some of you may remember my last LinkedIn article about selling at the height of the last cycle. It was 2017 and even a single-family home in a far-flung suburb attracted multiple offers in a bidding war.

What has transpired since is a multi-year saga. The length of time and the difficulty of the process underlines the problem of creating “Missing Middle” housing in Toronto. Now that I can see daylight, I want to share this tale with other practitioners.

In addition, a different cut on this story was the subject of a full-page article in the Globe & Mail Real Estate section. You can read this article on the GREENbilt site under Media www.greenbilthomes.ca

Intense Competition for High Cost Land

We all hear that it is hard to buy in Toronto. It’s especially hard when you are trying to buy a property with the right criteria for ground-oriented multi-family:

1.      Zoned for up to a triplex

2.      Well located on the transit network

3.      Lot price that “pencil’s out” for new construction

4.      Lot size and dimensions that minimize the required variances

GREENbilt Homes started the search for a property in The Junction. Months, and many failed bids later, we became “flexible” and started bidding in High Park and Mervish Village. Later, shell shocked by bidding wars and disappointment, we cast our net even wider – Roncenvalles, Parkdale, the Upper Beach etc. Months and more bids went by. Finally, a year and a half after we started, GREENbilt had success in Mimico-on-the-Lake.

The Yellowbelt Problem

We at GREENbilt saw many, many listed properties that met criteria 2 to 4. Problem was that even when they were close to the Weston UP Station or within walking distance of the Bloor subway, they were zoned “residential detached” (aka Yellowbelt). For us, that zoning means “end of story”. Even though many properties are reasonably priced, the uncertainty and cost of trying to up-zone a RD property, even if it is adjacent to commercial, turns the process into a crap shoot.

Solving the Affordability Crisis?

Toronto’s own data shows that half of residents spend more than 30% on housing – the traditional metric for affordability – and distressingly, a quarter of the city’s residents spend more than 50% of their income.

Those of us in the residential building business know that current developments are not providing affordable solutions. Too little land is zoned for multi-family development, and the developments that get approved are expensive high-rise steel and concrete buildings.

Hopefully, Mayor John Tory’s request to Planning Staff to report on the potential for “gentle densification” of the Yellowbelt can provide a solution. About 70% of the city’s residential land is zoned RD, so spurring Yellowbelt development that leads to a modest increase in the number of residential units per lot translates into a significant amount of new rental units.

Because the Yellowbelt has affordable land, and the costs of constructing wood-frame ground-oriented rental units is much cheaper than steel and concrete construction, the rents required to make these buildings “pencil out” is a lot lower than high-rise units.

GREENbilt’s Approval Process

The property that GREENbilt bought on a street zoned “Residential Multi” under the old Etobicoke zoning regulations still didn’t meet the requirements for a duplex. This was a conventional 25 X 125 lot, while the minimum frontage for a duplex was around 35 feet. 

Even though there were old “Toronto Special” triplex buildings on the same or similar-sized lots on the same street, getting through the approval process to build a duplex was difficult and nerve-racking. There were many discussions with the planners, and there were negotiations back and forth on many of the building specifications right up to the deadline. This level of uncertainty about what can be built in an area zoned RM shows that even under the current regulations, building “Missing Middle” properties is an uncertain process.

Fortunately, on a beautiful August day, more than two years after we sold, GREENbilt received approval to proceed with a duplex.

Can FlexPlex? be the Answer to the Missing Middle?

Many of us in the building business believe that design excellence can overcome many problems. The duplex that the architecture firm Sustainable has designed for GREENbilt may be a poster child for good design that overcomes the obstacles to implementing “gentle densification”. 

The duplex is a FlexPlex?: It’s the prototype for a three-storey building that looks like an attractive contemporary single-family home on the outside (regardless of the configuration of the interior). The building looks like what is being built today in the Yellowbelt.

The design allows for the building to be easily changed from triplex to duplex to single family home with interior-only renovations – mostly moving around walls and swapping kitchens in and out. Think of it as the building equivalent of one of those minivans that goes from eight-person station wagon to cargo van by changing the seats. https://www.youtube.com/watch?v=6tzA_b_f18Q

Building in 2020

With the building permit process yet to come, we anticipate that the GREENbilt FlexPlex? will be constructed next year. We can let you know about education sessions that we’ll be holding during the construction process, and open houses that will be held at completion if you’ll get in touch with us. Please connect if you are interested!