November 28, 2018 VIA…

November 28, 2018 VIA COURIER Ministry of Municipal Affairs and Housing Municipal Services Division Municipal Services Office - Central Ontario 777 Bay Street, Floor 13 Toronto ON M5G 2E5 ATTN:The Honourable Steve Clark, MPP Minister of Municipal Affairs Dear Sirs/Mesdames: Re:Proposed City of Toronto Official Plan Amendment No. 406 (By-law 1111-2018) (the “Proposed Amendment”) EBR Registry Number: 013-3485 Ministry Reference Number: 20-OP-178646 We are counsel to Primaris Reit and H&R Reit (“H&R”) with respect to the above-captioned matter. H&R’s business is in owning and managing properties and it has 14 buildings in Toronto (6 in the Downtown) comprising approximately 5.18 million square feet in floor area. Please note that H&R’s portfolio consists, at this time, entirely of commercial and industrial buildings. As a landlord, H&R sees itself as a long term resident in every community in which its buildings are located. All of this is to say that H&R has a general interest in the future of planning in Toronto. In particular with respect to the foregoing, it is the owner of properties known as 55 Yonge Street, 26 Wellington Street East, 145 Wellington Street West, 310 – 330 Front Street West, 25 Dockside and 595 Bay Street , all of which are intended by the City of Toronto to be subject to the Proposed Amendment upon its approval. Even more specifically, H&R is in the process of reviewing potential investment in Toronto by considering options for the redevelopment of its properties within the Downtown. However, H&R submits that many of the provisions of the Proposed Amendment are inappropriate from a land use planning policy perspective by, among other things, failing to provide for a framework where contextually appropriate redevelopment and intensification can reasonably be expected to proceed and that it should be significantly modified before it is approved, in whatever forum that may ultimately be. Further, it submits that there are legal issues attending the Proposed Amendment that must be addressed prior to its approval.  The following are the general categories of H&R’s land use planning policy concerns with the Proposed Amendment, a number of which are intertwined with legal issues: 1.The Taking of Private Property (a)The proposed appropriation by the City of private interests in land for purpose of an expansion to the public realm, without a legal basis for such taking; and (b)The proposed appropriation of private property, financial or otherwise, for the purpose of providing inadequately described facilities for the use of the public, without a legal basis for such taking. 2.The proposed imposition of built-form restrictions which are unnecessarily restrictive (e.g. floor plate limitations, “minimizing” shadows) and too arbitrary (e.g. “…fits within and complements the overall Downtown skyline”). Further “transition” is treated as a goal of itself and is thus inappropriate. 3.The proposed imposition of restrictions on the timing of development linked to the provision of community service facilities, which are for practical purposes at the discretion of the City or a third party such as a school board. 4.The proposed imposition of a parkland provision which provides effectively unfettered discretion to the municipality in enacting a parkland dedication by-law, without regard for the potential negative implications for Provincial intensification objectives. Further, a proposal to create a requirement for parkland dedication off-site which is not supported by law. Finally, a provision discouraging windows adjacent to parks which is inconsistent with another provision encouraging just that result. 5.The proposed imposition of rigid housing unit size and mix requirements, which impede the ability to respond to market demand, increase housing costs and lead to inefficiencies in the provision of community service facilities. 6.The limitation of new residential development, in certain areas, to that permitted under existing zoning. 7.The proposed imposition of strict requirements, in certain areas, for maintaining or increasing the gross floor area of certain non-residential uses. 8.The proposed imposition on building (including interiors) and site programming of requirements for amenity space. 9.The proposed reservation by the City of an ability to change official plan policy, after receipt of an application, but prior to, and applicable to, the consideration of such application.  The foregoing will be addressed in turn, followed by commentary on the more purely legal issue of the proper Planning Act route for approval of the Proposed Amendment. 1.The Taking of Private Property (a)The appropriation of private interests in land: The Proposed Amendment includes numerous provisions which contemplate provision for access by the general public over private property and/or specific improvements to the public realm being provided by private landowners (e.g. Downtown Plan Sections 8.5, 8.11, 9.1.2, 9.2, 9.3, 9.4, 9.5, 9.7). These provisions very generally fall into two categories. The first is, for practical purposes, widenings of public sidewalks, with reference to a specific numerical standard. The second category is for similar widenings, but imprecisely described, and other enhancements to the public realm including POPs and forecourts. An immediate issue is that the taking of any property must have a basis in law, and the Proposed Amendment demonstrates no such basis. The result here is that the taking would be arbitrary from a functional perspective: the City would not be required to justify the taking on the basis of a legitimate planning policy objective. Putting aside the illegality, the negative policy implication is that the certainty for all stakeholders which is supposed to be the result of the planning process is diminished and desirable intensification is discouraged. (b)The appropriation of private property, financial and otherwise: The Proposed Amendment contains numerous provisions which on its plain words “require” the provision of, or contributions toward, community service facilities, but provides no basis in law for such taking (e.g. Downtown Plan Sections 5.2, 10.3, 10.5, 10.9, 10.11). Further, there is no direction or suggestion for how such “contribution” relates to the development from which it is to be exacted. We also note that the City seeks, in Section 10.1, to elevate the status of a non-statutory instrument, providing that the “Downtown Community Services and Facilities Strategy” will “guide” the provision of community service facilities. This is contrary to law and inconsistent with existing official plan policy which clearly demarcates limits to the application of such non-statutory instruments. 2.Built-Form Restrictions The Proposed Amendment would provide, in addition to the detailed and prescriptive built-form regime set out in the proposed official plan amendment No. 352 and its implementing zoning, which a priori discourages intensification and diminishes the opportunity for creative architectural design, further provisions which serve as restrictions on built-form. In Part 9 of the Downtown Plan, in addition to requirements respecting the relationship of the proposed development to the “skyline”, without any guidance on what such a relationship should be, there are directions to “minimize” shadows and “maximize” sunlight. The issue with such wording is that it must be seen as arbitrary, since on the plain words such minimization and maximization lead to the same unreasonable result: constructing no new buildings at all. H&R would also submit that the a priori restriction of non-residential buildings to a floor plate of 750 square meters must be seen as discouraging commercial office development. In its experience there is very little market demand for such product in major office centres. 3.The Timing of Development and Community Service Facilities The Proposed Amendment includes holding provisions providing for the delay of development pending the provision community service facilities (e.g. Downtown Plan Section 14.8, dovetailing with Section 5.2). However, it is not appropriate to delay development pending the provision of community service facilities since such provision is at the discretion of community service providers. The apparent/implied inclusion of public schools in the definition of “community service facility” is particularly problematic in this respect. The Toronto District School Board (“TDSB”) has publicly taken the position that development ought to be delayed pending confirmation of school capacity, in full knowledge of and despite Ministry of Education policy that capital facilities to provide therefor will not be funded until the students are already present (e.g. being bussed or accommodated in portable classrooms). The Proposed Amendment provides the basis for implementing the TDSB position effectively thwarting Ministry of Education policy, which we submit is intended to impose fiscal discipline on TDSB, which has a large stock of underutilized capital facilities. 4.Housing Mix Part 11 of the Proposed Amendment sets out housing policies. The proposed unit mix and size requirements will have a negative impact on affordability contrary to Provincial policy, which will be exacerbated in the event that as a result of other city initiatives a development is compelled to subsidize housing in order to make it affordable to low and moderate income households. Furthermore, the prescriptive nature of the mix means that the ability of a developer or landlord to tailor the building program to the market or the neighbourhood is limited. This means less efficiency in the provision of both private and public services. 5.Parkland Section 7.4.1 of the Proposed Amendment purports to require the City to adopt a new parkland dedication by-law, with the sole constraint that the alternate rate(s) would be “commensurate with the intensity of development”. H&R submits that given the other “takings” contemplated by the Proposed Amendment which are identified herein, parameters for the park “taking” should be established in the Proposed Amendment which are sufficiently defined so as to permit an assessment in land use planning policy terms of their collective effect. Furthermore, we submit that the apparent intent of Sections 7.4.2 and 7.4.3 collectively is to require off-site parkland dedication when desired by the City. We submit that such cannot be required as a matter of law, so either such sections should be deleted or revised. We also think it should be noted that Section 7.4.3, which requires development adjacent ot a park to provide certain additional setbacks or incur additional construction costs if there are facing windows, is inconsistent with Section 7.4.6 which purports to require windows to provide for “increasing the passive surveillance and safety of the parks”. This is potentially a significant issue given that Section 7.42.1 clearly sets out that on-site parkland will be City’s first priority to meet dedication requirements. 6.Limitation on Residential Development H&R knows from experience that residential development located nearby is effectively an amenity for commercial buildings. The prospect of workers having the option of a short commute is often an attractive feature for commercial tenants. Further, residential uses typically attract other amenities which are also amenities for the users of commercial office space (e.g. convenience retail, services). Thus H&R submits that any cap on new residential development in official plan policy in the context of Downtown Toronto will only be counter-productive as it diminishes the attractiveness of the affected area. For example, H&R owns property at 145 Wellington Street West which the Proposed Amendment would limit to the existing zoned residential density of 11.7 times the area of the lot. 145 Wellington Street is located amongst intense development but not among the “Bank Towers”. The arbitrary limitation on residential usage applicable to these lands serves to lessen the opportunity for active transportation, lessen the support for public transit, lessen support for existing area amenities , lessen the opportunity to create a 24 hour neighourhood and lessen the critical mass available to support the provision of such public facilities as are necessary to support such residential as is permitted, all without regard for whether a more intense mix of uses creates material impacts on any stakeholder. Thus neither public nor commercial tenant interests are served. H&R does acknowledge that if an area such as the Financial District could be demonstrated in future to be losing office gross floor area in absolute terms at a level that raises issues with having a sufficient critical mass to operate as a major office centre then a policy response could be warranted, but this is far from the circumstances either present today or foreseeable. 7.Requirements to Retain/Increase Non-Residential Uses Policies in the Proposed Amendment such as Downtown Plan Sections 6.2, 6.6, 6.8 and 10.5 require either the retention or an increase of the gross floor area of an identified non-residential use. As set out above, with respect to office uses, in the absence of a demonstrated area-wide loss of office commercial floor space any restriction on the market will be counter-productive. Strict numerical standards for such exacerbate the problem. Since residential and non-residential uses have differing building requirements, to say nothing of differing tenant requirements (which can take the form of such things as separate elevator cores or other building services), accommodating the varied requirements into one development, and particularly into one building, is a real impediment to an intensified use of a property. We note as well that the proposed requirement to maintain in any new development all previously existing gross floor area that would constitute “cultural spaces”, in addition to being unfair to any owner thereof, which now has the market for such space severely restricted, will serve as a strong disincentive going forward to the provision of space to any tenant with a significant linkage to “cultural” activity caught by the policy definition. 8.Increased Interference with Building Programming and Interior Design From H&R’s perspective, the provision of office commercial space is a tenant-driven exercise. H&R would be severely hampered in the competition for tenants if it was forced to provide amenities that its tenants do not want and are not prepared to pay for. However, the “Amenity Space” provisions of the Proposed Amendment indicate just such an intent. The problem is exacerbated (and this would apply to residential and residential mixed-use projects as well) by the provisions directed at the design of the amenity space, and in particular provisions related to the interior design of buildings. 9.Changeable Official Plan Policy Section 5 of the Proposed Amendment represents an attempt by the City to reserve the ability to change its official plan after receipt of an application and use that changed policy in the consideration of an application. The City has argued just such a position in an LPAT proceeding based on an official plan provision similarly worded in that respect. H&R submits that this is inappropriate, being contrary on a fundamental level to the purpose of the Planning Act. 10.Legal Issues The City purported to process the Proposed Amendment through Section 26 of the Planning Act, the effect of which is that no appeal thereof to the Local Planning Appeal Tribunal exists. H&R submits that this is not supported by law. The Proposed Amendment is a secondary plan. It is thus by definition geographically limited, not comprehensive, and the subject matter otherwise therein is self-evidently does not meet the statutory requirements for a “revision” pursuant to Section 26 of the Planning Act. If it were held to be so, any municipality could invoke Section 26 for any official plan amendment and thus shield such official plan amendment from appeal. Conclusion H&R’s analysis to date respecting its own properties indicates that residential intensification and commercial (including office) revitalization have a symbiotic relationship and that the provision of significant residential gross floor area thus promotes both employment and housing agendas. However, as is evident from the foregoing, the Proposed Amendment discourages intensification, both commercial and residential, hurts housing affordability and not only does it not promote the efficient use of community service facilities, it provides a platform for TDSB to effectively thwart Ministry of Education policy directed at the efficient use of TDSB resources. It is thus inconsistent with the Provincial Policy Statement and does not conform to the Growth Plan for the Greater Golden Horseshoe 2017. Given the range of deficiencies in the Proposed Amendment, we would respectfully suggest either that the Ministry undertake an extensive consultative program prior to approving same in order to effectively and meaningfully address the concerns raised herein or to not render any decision. This would permit interested parties to appeal the non-decision to the Local Planning Appeal Tribunal where the matter could be mediated or, failing that, litigated. Yours truly, McCarthy Tétrault LLP John A.R. Dawson