Item - 2020.EX12.4

The Deputy City Manager, Corporate Services recommends that:

1.  City Council authorize the Executive Director, Corporate Real Estate Management, in consultation with CreateTO, to continue to negotiate an agreement with all applicable parties for the acquisition of the Property Interests, as set out in Appendix A to the report (January 9, 2020) from the Deputy City Manager, Corporate Services and shown approximately in Appendix B  to the report (January 9, 2020) from the Deputy City Manager, Corporate Services, at fair market value and, if unsuccessful, to initiate expropriation proceedings for the Property Interests.

2.  City Council authorize the Executive Director, Corporate Real Estate Management, and/or a designate, to serve and publish Notices of Application for Approval to Expropriate Land for the Property Interests, to forward any requests for hearings to the Chief Inquiry Officer, to attend any requested Hearings of Necessity in order to present the City's position and to report the Inquiry Officer's recommendations to City Council for consideration.

3. City Council request the Board of Directors of CreateTO to consider any proposed transaction(s) concerning the Property Interests and that the Board of Directors of CreateTO provide recommendations to the Executive Committee on any proposed transaction(s) involving the Property Interests and a strategy for the acquisition of remaining properties in the Rail Deck Park project area.

This report provides an update on the status of real estate matters related to the Rail Deck Park project, and seeks authority to initiate expropriation proceedings for just over 3 acres (1.2 hectares) of air space above the Union Station Rail Corridor, south of Front Street West between Spadina Avenue and Blue Jays Way (the "Property Interests"), as set out in Appendix A and shown approximately in Appendix B, for the purposes of the Rail Deck Park project.

Negotiations for the acquisition of the Property Interests have been ongoing with the various owners with no success to date.

Together with the City's existing 1-acre Northern Linear Park property, the Property Interests would support the development of the first 4 acres of Rail Deck Park. A 4-acre park provides a wide range of programming potential and is roughly the same size as Grange Park in Downtown Toronto.

The Property Interests are also adjacent to the Oxford Properties Group Inc. Union Park proposal, which is located to the east of Blue Jays Way. The Union Park proposal provides approximately 3 acres of contiguous park and open space, including 2 acres to be built above the rail corridor. When both projects are completed, they will create a combined park area of approximately 7 acres. The opportunity to assemble a parkland parcel of this scale rarely arises in downtown Toronto, and aligning the design and implementation of a first phase of Rail Deck Park with the Union Park proposal would enhance the public benefits of each proposal.

The Property Interests represent a strategic acquisition by the City of Toronto to guide the future development of this area of the rail corridor in a manner consistent with the City's Official Plan policies. Additional air space in the Rail Deck Park project area (ie: between Spadina Avenue and Bathurst Street) will be pursued at a time when staff are confident that they can be acquired at fair market value. 

The acquisition of the Property Interests by the City of Toronto is necessary to proceed with joint planning and delivery of Rail Deck Park and the GO Expansion project, as directed by Council in 2017. Agreement between the City and Metrolinx will be required in 2020 for the delivery of capital works related to the Rail Deck Park project that cannot be independently delivered by the City, to meet Metrolinx's procurement and delivery timelines. The City should only enter into an agreement for delivery of capital works if it has a reasonable prospect of acquiring the properties in which they are proposed to be built.

This report is the first stage of the expropriation process and authorizes staff to continue negotiations to acquire the Property Interests and, if unsuccessful, to initiate expropriation proceedings, including associated administrative costs. This report does not authorize spending on the Rail Deck Park project beyond the budget approved through previous Council reports.

Staff will bring forward a report to Council by the third quarter of 2020 to authorize the next stage of the Rail Deck Park project, including a funding and financing strategy for acquisition of the air space and capital delivery of the project.