Item - 2025.EX26.2

The Executive Committee recommends that:

1. City Council authorize the Executive Director, Housing Development Office, or their designate, in consultation with the Deputy City Manager, Development and Growth Services, to negotiate and execute, on behalf of the City, a framework agreement and any amendments ("the Framework Agreement") and any related agreements, substantially on the major terms and conditions and with the parties set out in Confidential Appendix A to the revised report (September 26, 2025) from the Executive Director, Housing Development Office and the Executive Director, Housing Secretariat, and such other terms satisfactory to Executive Director, Housing Development Office, in consultation with Deputy City Manager, Development and Growth Services, and in a form approved by the City Solicitor.

2. City Council authorize the Executive Director, Housing Development Office, or their designate, in consultation with the Executive Director, Housing Secretariat and the Deputy City Manager, Development and Growth Services to negotiate and execute, on behalf of the City, an all party agreement and any related agreements and amendments ("the All-Party Agreement"), substantially on the major terms and conditions and with the parties set out in Confidential Appendix A to the revised report (September 26, 2025) from the Executive Director, Housing Development Office and the Executive Director, Housing Secretariat, and such other terms satisfactory to the Executive Director, Housing Development Office, in consultation with the Executive Director, Housing Secretariat and the Deputy City Manager, Development and Growth Services, and in a form approved by the City Solicitor.

3. City Council authorize the Executive Director, Corporate Real Estate Management, or their designate, in consultation with the Executive Director, Housing Development Office, to negotiate and execute, on behalf of the City, long-term nominal rent leases with each of the affordable housing providers selected by the Executive Director, Housing Secretariat through the request for proposals issued for this project (the “Affordable Housing Providers”), substantially on the major terms and conditions set out in Attachment 1 to the revised report (September 26, 2025) from the Executive Director, Housing Development Office and the Executive Director, Housing Secretariat, and such other terms satisfactory to the Executive Director, Corporate Real Estate Management, in consultation with the Executive Director, Housing Development Office, and in a form approved by the City Solicitor, and conditional upon the premises to be leased to such Affordable Housing Providers having been declared surplus and all steps necessary to comply with the City’s real estate disposal process as set out in Article 1 of Chapter 213 of the City of Toronto Municipal Code having been complied with, all on or before the date that Council considers this recommendation.

4. City Council authorize the Executive Director, Corporate Real Estate Management, or their designate, to negotiate and execute on behalf of the City the reciprocal/cost sharing agreement(s) contemplated in the Framework Agreement and any agreements related to the acquisition and leasing out of land in Quayside Phase 1 by the City on such terms as are satisfactory to the Executive Director, Corporate Real Estate Management, and in a form approved by the City Solicitor.

5. City Council authorize the Chief Procurement Officer to award and the Executive Director, Housing Development Office, or their designate, in consultation with Chief Financial Officer and Treasurer and Executive Director, Housing Secretariat to negotiate and execute, on behalf of the City, any necessary non-competitive agreements with a value exceeding $500,000 for which Standing Committee and City Council approval would normally be required under City of Toronto Municipal Code Chapter 71, Financial Control, and City of Toronto Municipal Code Chapter 195, Procurement, for the provision of professional services needed to carry out any necessary development coordination matters for the development of affordable housing in Quayside - Phase 1, provided that:

a. non-competitive procurement is necessary to meet the timelines related to the development of affordable rental homes in Quayside - Phase 1;

b. the costs are available for, and funded through the Council-approved Housing Secretariat's 10-year Capital Budget and Plan for the Quayside - Phase 1 project; 

c. the terms and conditions of any such agreements are acceptable to the Executive Director, Housing Development Office, and in a form satisfactory to the City Solicitor; and

d. a report summarizing any agreements executed under this authority is submitted to the appropriate Standing Committee and/or City Council for information by the fourth quarter of 2026.

6. City Council authorize the Executive Director, Housing Development Office, or their designate to negotiate and execute, on behalf of the City, an owners representative agreement and any related agreements and amendments, substantially on the major terms and conditions and with the parties set out in Attachment 2 to the revised report (September 26, 2025) from the Executive Director, Housing Development Office and the Executive Director, Housing Secretariat, and such other terms satisfactory to the Executive Director, Housing Development Office, and in a form approved by the City Solicitor.

7. City Council authorize an exemption from taxation for municipal and school purposes for the affordable rental homes developed on the blocks in Quayside - Phase 1 listed in and for the periods of time described in Table 1 in the Financial Impact section of the revised report (September 26, 2025) from the Executive Director, Housing Development Office and the Executive Director, Housing Secretariat.

8. City Council authorize the Controller and Chief Accountant to cancel or refund any taxes paid after the effective date of the exemption from taxation for municipal and school purposes as set out in the applicable Municipal Housing Facility Agreement (the “Contribution Agreement”).

9. City Council adopt the confidential recommendations in Confidential Attachment 1 to the revised report (September 29, 2025) from the Executive Director, Housing Development Office and the Executive Director, Housing Secretariat.

10. City Council direct that Confidential Attachment 1 and Confidential Appendices A and B to the revised report (September 29, 2025) from the Executive Director, Housing Development Office and the Executive Director, Housing Secretariat remain confidential in their entirety, as they outline a position, plan, procedure, criteria or instruction to be applied to any negotiations carried on or to be carried on by or on behalf of the City; and contain financial information, supplied in confidence to the City of Toronto, which, if disclosed, could reasonably be expected to prejudice significantly the competitive position or interfere significantly with the contractual or other negotiations of a person, group of persons, or organization, and be made public at the discretion of the Deputy City Manager, Development and Growth Services.

Quayside will be a master-planned mixed-use complete community that builds on development in the adjacent East Bayfront lands, and the emerging Keating Channel West Precinct. This 4.9-hectare area on Toronto’s waterfront, located at Queens Quay East and Parliament Street (Quayside Lands), will include new homes, parks and public spaces, new and improved infrastructure, roads and public realm within five new development blocks.

A key driver for Quayside is the provision of affordable rental homes by the City in partnership with Waterfront Toronto and Quayside Impact Limited Partnership (QILP). With the softening of the condo market, the City, QILP, and Waterfront Toronto have worked on an accelerated plan to maximize the number of affordable rental homes that can be delivered in the first phase while prioritizing the delivery of purpose-built rental homes on an expedited basis. As the result, it is estimated that approximately 550 affordable rental homes, including 57% as family units, and approximately 1,200 purpose-built rental homes will be delivered by 2030-31. The Quayside-Phase 1 project supports the City in achieving its HousingTO 2020-20304 Action Plan target to approve 65,000 rent-controlled homes (comprised of 6,500 rent-geared-to-income (RGI), 41,000 affordable rental and 17,500 rent-controlled market homes) by 2030.

Achieving these ambitious housing outcomes within a delivery model involving government, private and non-profit partners will require all partners to participate in innovative ways while responding to changing market conditions. The delivery model for the affordable rental homes in Quayside represents another step in implementing the "Public Developer" approach where the City is taking an intentional leadership role in bringing land, funding, financing, and non-profit and Indigenous housing partners together to maximize public benefit for generations to come. This delivery model will include:

- QILP to transfer stratified lands where affordable rental homes will be built to the City prior to construction start. These lands will then be leased to non-profit housing providers selected to own and operate these affordable rental homes for 99 years ("Affordable Housing Providers");

- QILP (or a related entity) to act as the development manager for the site, and with a construction manager, design and build the affordable and purpose-built rental homes;

- Waterfront Toronto to act as the master developer for the Quayside Lands which includes affordable housing, Quayside infrastructure and public realm, design objectives (buildings and Privately Owned Public Space), ground floor animation objectives and sustainability requirements; and,

- Government partners and Waterfront Toronto to provide funding and financing to the Affordable Housing Providers for the construction of affordable rental homes.

As the housing crisis in the city persists, expediting the delivery plan to ensure construction can start in 2026 has been a key consideration for all partners. The City, through its agreement with the federal government under the Housing Accelerator Fund (HAF), has committed to advancing major development on Toronto’s waterfront, including accelerating the delivery of purpose-built rental, and permanently affordable rental homes in Quayside. The City has already made progress towards meeting its HAF milestones by expediting zoning approvals in July 2024 and increasing the permitted density to allow for taller buildings with reduced building footprints. The current plan also represents an improvement upon the number of affordable rental homes that were identified in the July 2024 re-zoning application, which was 458. The final milestone for this initiative requires building permits be issued for the affordable rental homes in Phase 1 by Q3-2026.

Subject to the approval of this report, the project team will be able to move towards meeting upcoming critical milestones including submitting applications to Canada Mortgage and Housing Corporation (CMHC) for construction financing by October 31, 2025, finalizing required loan agreements with CMHC by Q1-2026, and accelerating construction start timelines.

In partnership with Waterfront Toronto, QILP, and CMHC, the City has been able to make a number of significant advancements in accelerating delivery of purpose-built and affordable rental homes through Quayside - Phase 1. This report and the confidential attachment provide:

- an update on the funding plan for approximately 550 affordable rental homes and required authorities to receive and invest funds, including property tax exemptions for the affordable rental homes;

- an update on the results of the competitive Request for Proposals (RFP) process to select up to four Affordable Housing Providers, and the required authorities to enter into applicable agreements; and,

- an overview of how the City will work with project partners, including the Affordable Housing Providers, CMHC, QILP and Waterfront Toronto as the future owner of stratified affordable rental housing lands and funder for the affordable rental homes.

The Quayside- Phase 1 project will deliver approximately 1,750 affordable rental and purpose-built rental homes through a unique and innovative partnership model with private, non-profit, and government partners. The delivery model, however, is complex due to the interconnectedness of funding and financing sources, various roles and responsibilities of multiple partners, navigating the complex regulatory environment within the accelerated timelines of the project, as well as ongoing market pressures.

The federal and provincial governments, along with the City of Toronto, have recently approved a joint investment plan of $975 million to accelerate the delivery of Waterfront Toronto’s revitalization plan including delivery of new homes in Quayside and Ookwemin Minising (formerly Villiers Island). The tri-partite collaboration continues to be critical to ensure the Quayside - Phase 1 project can be delivered within this unique delivery model and can be replicated for delivery of much needed homes along Toronto's waterfront for current and future residents of the city.

The Executive Committee recommends that:

1. City Council authorize the Executive Director, Housing Development Office, or their designate, in consultation with the Deputy City Manager, Development and Growth Services, to negotiate and execute, on behalf of the City, a framework agreement and any amendments ("the Framework Agreement") and any related agreements, substantially on the major terms and conditions and with the parties set out in Confidential Appendix A to the revised report (September 26, 2025) from the Executive Director, Housing Development Office and the Executive Director, Housing Secretariat, and such other terms satisfactory to Executive Director, Housing Development Office, in consultation with Deputy City Manager, Development and Growth Services, and in a form approved by the City Solicitor.

2. City Council authorize the Executive Director, Housing Development Office, or their designate, in consultation with the Executive Director, Housing Secretariat and the Deputy City Manager, Development and Growth Services to negotiate and execute, on behalf of the City, an all party agreement and any related agreements and amendments ("the All-Party Agreement"), substantially on the major terms and conditions and with the parties set out in Confidential Appendix A to the revised report (September 26, 2025) from the Executive Director, Housing Development Office and the Executive Director, Housing Secretariat, and such other terms satisfactory to the Executive Director, Housing Development Office, in consultation with the Executive Director, Housing Secretariat and the Deputy City Manager, Development and Growth Services, and in a form approved by the City Solicitor.

3. City Council authorize the Executive Director, Corporate Real Estate Management, or their designate, in consultation with the Executive Director, Housing Development Office, to negotiate and execute, on behalf of the City, long-term nominal rent leases with each of the affordable housing providers selected by the Executive Director, Housing Secretariat through the request for proposals issued for this project (the “Affordable Housing Providers”), substantially on the major terms and conditions set out in Attachment 1 to the revised report (September 26, 2025) from the Executive Director, Housing Development Office and the Executive Director, Housing Secretariat, and such other terms satisfactory to the Executive Director, Corporate Real Estate Management, in consultation with the Executive Director, Housing Development Office, and in a form approved by the City Solicitor, and conditional upon the premises to be leased to such Affordable Housing Providers having been declared surplus and all steps necessary to comply with the City’s real estate disposal process as set out in Article 1 of Chapter 213 of the City of Toronto Municipal Code having been complied with, all on or before the date that Council considers this recommendation.

4. City Council authorize the Executive Director, Corporate Real Estate Management, or their designate, to negotiate and execute on behalf of the City the reciprocal/cost sharing agreement(s) contemplated in the Framework Agreement and any agreements related to the acquisition and leasing out of land in Quayside Phase 1 by the City on such terms as are satisfactory to the Executive Director, Corporate Real Estate Management, and in a form approved by the City Solicitor.

5. City Council authorize the Chief Procurement Officer to award and the Executive Director, Housing Development Office, or their designate, in consultation with Chief Financial Officer and Treasurer and Executive Director, Housing Secretariat to negotiate and execute, on behalf of the City, any necessary non-competitive agreements with a value exceeding $500,000 for which Standing Committee and City Council approval would normally be required under City of Toronto Municipal Code Chapter 71, Financial Control, and City of Toronto Municipal Code Chapter 195, Procurement, for the provision of professional services needed to carry out any necessary development coordination matters for the development of affordable housing in Quayside - Phase 1, provided that:

a. non-competitive procurement is necessary to meet the timelines related to the development of affordable rental homes in Quayside - Phase 1;

b. the costs are available for, and funded through the Council-approved Housing Secretariat's 10-year Capital Budget and Plan for the Quayside - Phase 1 project; 

c. the terms and conditions of any such agreements are acceptable to the Executive Director, Housing Development Office, and in a form satisfactory to the City Solicitor; and

d. a report summarizing any agreements executed under this authority is submitted to the appropriate Standing Committee and/or City Council for information by the fourth quarter of 2026.

6. City Council authorize the Executive Director, Housing Development Office, or their designate to negotiate and execute, on behalf of the City, an owners representative agreement and any related agreements and amendments, substantially on the major terms and conditions and with the parties set out in Attachment 2 to the revised report (September 26, 2025) from the Executive Director, Housing Development Office and the Executive Director, Housing Secretariat, and such other terms satisfactory to the Executive Director, Housing Development Office, and in a form approved by the City Solicitor.

7. City Council authorize an exemption from taxation for municipal and school purposes for the affordable rental homes developed on the blocks in Quayside - Phase 1 listed in and for the periods of time described in Table 1 in the Financial Impact section of the revised report (September 26, 2025) from the Executive Director, Housing Development Office and the Executive Director, Housing Secretariat.

8. City Council authorize the Controller and Chief Accountant to cancel or refund any taxes paid after the effective date of the exemption from taxation for municipal and school purposes as set out in the applicable Municipal Housing Facility Agreement (the “Contribution Agreement”).

9. City Council adopt the confidential recommendations in Confidential Attachment 1 to the revised report (September 29, 2025) from the Executive Director, Housing Development Office and the Executive Director, Housing Secretariat.

10. City Council direct that Confidential Attachment 1 and Confidential Appendices A and B to the revised report (September 29, 2025) from the Executive Director, Housing Development Office and the Executive Director, Housing Secretariat remain confidential in their entirety, as they outline a position, plan, procedure, criteria or instruction to be applied to any negotiations carried on or to be carried on by or on behalf of the City; and contain financial information, supplied in confidence to the City of Toronto, which, if disclosed, could reasonably be expected to prejudice significantly the competitive position or interfere significantly with the contractual or other negotiations of a person, group of persons, or organization, and be made public at the discretion of the Deputy City Manager, Development and Growth Services.

Quayside will be a master-planned mixed-use complete community that builds on development in the adjacent East Bayfront lands, and the emerging Keating Channel West Precinct. This 4.9-hectare area on Toronto’s waterfront, located at Queens Quay East and Parliament Street (Quayside Lands), will include new homes, parks and public spaces, new and improved infrastructure, roads and public realm within five new development blocks.

A key driver for Quayside is the provision of affordable rental homes by the City in partnership with Waterfront Toronto and Quayside Impact Limited Partnership (QILP). With the softening of the condo market, the City, QILP, and Waterfront Toronto have worked on an accelerated plan to maximize the number of affordable rental homes that can be delivered in the first phase while prioritizing the delivery of purpose-built rental homes on an expedited basis. As the result, it is estimated that approximately 550 affordable rental homes, including 57% as family units, and approximately 1,200 purpose-built rental homes will be delivered by 2030-31. The Quayside-Phase 1 project supports the City in achieving its HousingTO 2020-20304 Action Plan target to approve 65,000 rent-controlled homes (comprised of 6,500 rent-geared-to-income (RGI), 41,000 affordable rental and 17,500 rent-controlled market homes) by 2030.

Achieving these ambitious housing outcomes within a delivery model involving government, private and non-profit partners will require all partners to participate in innovative ways while responding to changing market conditions. The delivery model for the affordable rental homes in Quayside represents another step in implementing the "Public Developer" approach where the City is taking an intentional leadership role in bringing land, funding, financing, and non-profit and Indigenous housing partners together to maximize public benefit for generations to come. This delivery model will include:

- QILP to transfer stratified lands where affordable rental homes will be built to the City prior to construction start. These lands will then be leased to non-profit housing providers selected to own and operate these affordable rental homes for 99 years ("Affordable Housing Providers");

- QILP (or a related entity) to act as the development manager for the site, and with a construction manager, design and build the affordable and purpose-built rental homes;

- Waterfront Toronto to act as the master developer for the Quayside Lands which includes affordable housing, Quayside infrastructure and public realm, design objectives (buildings and Privately Owned Public Space), ground floor animation objectives and sustainability requirements; and,

- Government partners and Waterfront Toronto to provide funding and financing to the Affordable Housing Providers for the construction of affordable rental homes.

As the housing crisis in the city persists, expediting the delivery plan to ensure construction can start in 2026 has been a key consideration for all partners. The City, through its agreement with the federal government under the Housing Accelerator Fund (HAF), has committed to advancing major development on Toronto’s waterfront, including accelerating the delivery of purpose-built rental, and permanently affordable rental homes in Quayside. The City has already made progress towards meeting its HAF milestones by expediting zoning approvals in July 2024 and increasing the permitted density to allow for taller buildings with reduced building footprints. The current plan also represents an improvement upon the number of affordable rental homes that were identified in the July 2024 re-zoning application, which was 458. The final milestone for this initiative requires building permits be issued for the affordable rental homes in Phase 1 by Q3-2026.

Subject to the approval of this report, the project team will be able to move towards meeting upcoming critical milestones including submitting applications to Canada Mortgage and Housing Corporation (CMHC) for construction financing by October 31, 2025, finalizing required loan agreements with CMHC by Q1-2026, and accelerating construction start timelines.

In partnership with Waterfront Toronto, QILP, and CMHC, the City has been able to make a number of significant advancements in accelerating delivery of purpose-built and affordable rental homes through Quayside - Phase 1. This report and the confidential attachment provide:

- an update on the funding plan for approximately 550 affordable rental homes and required authorities to receive and invest funds, including property tax exemptions for the affordable rental homes;

- an update on the results of the competitive Request for Proposals (RFP) process to select up to four Affordable Housing Providers, and the required authorities to enter into applicable agreements; and,

- an overview of how the City will work with project partners, including the Affordable Housing Providers, CMHC, QILP and Waterfront Toronto as the future owner of stratified affordable rental housing lands and funder for the affordable rental homes.

The Quayside- Phase 1 project will deliver approximately 1,750 affordable rental and purpose-built rental homes through a unique and innovative partnership model with private, non-profit, and government partners. The delivery model, however, is complex due to the interconnectedness of funding and financing sources, various roles and responsibilities of multiple partners, navigating the complex regulatory environment within the accelerated timelines of the project, as well as ongoing market pressures.

The federal and provincial governments, along with the City of Toronto, have recently approved a joint investment plan of $975 million to accelerate the delivery of Waterfront Toronto’s revitalization plan including delivery of new homes in Quayside and Ookwemin Minising (formerly Villiers Island). The tri-partite collaboration continues to be critical to ensure the Quayside - Phase 1 project can be delivered within this unique delivery model and can be replicated for delivery of much needed homes along Toronto's waterfront for current and future residents of the city.