WEBVTT
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Isn't it interesting that police officers and nurses, firefighters in Toronto can't live in Toronto?
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No, I mean, there's a huge problem.
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And I think we want them to be able to live in Toronto.
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Hello, I'm Giles Gerson, and this is Toronto Talks, the voice of Toronto's business community.
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What are we talking about?
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Each episode is a conversation with top business leaders about how they're shaping growth, driving competitiveness, and building up our economy.
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It's about what they believe it will take to make sure the Toronto region remains one of the world's great global cities.
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Here's today's conversation.
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Tony, great to have you here for our Toronto Talks episode.
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Really excited to have a conversation about rental housing because that's something that, I mean, it's kind of interesting.
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We've gone through this condo boom in Toronto over the last 20 years, and all anybody talked about were condos.
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Now we're in a bit of a, I don't know it's too strong a word to say, collapse at the condo market, at least temporarily.
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And everyone's talking rental.
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Maybe just talk for our audience a bit about the organization.
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Sure.
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You know, the Federation of Rental Housing Providers of Ontario.
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Yep.
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Been around a long time.
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Yep.
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But maybe a few, you know, hum a few bars about that.
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Great.
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Thanks for having me.
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It's great to be here with you.
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Today, great conversation I know we'll have.
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So FERPO, Federation of Rental Housing Providers of Ontario, that's the word solid for sure.
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1985, it is. I'd like to shorten it, but that's not a conversation for another day.
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40 years old, 2,200 members.
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That's owners, builders, managers, suppliers to the industry, sort of the whole gambit.
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And so we are the largest association that advocates for strong and stable purpose-built rental housing in Ontario.
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I think we have a long and positive track record of collaborating with governments of various stripes, really to ensure that our members have a seat at the table.
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The association was created sort of coming out of rent control in the 1970s.
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I think at that time, owners felt there was a need to come together with other like-minded individuals and organizations to have a voice.
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So that's where it all started.
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And since then, our mission really hasn't changed much over the 40 years, I would say.
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in that it remains to be one of a trusted voice to government who government will reach out to, talk to, hear the issues, but also hear the solutions.
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And I think you've heard me talk about that, and I think it's vitally important.
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Everyone likes to criticize, but you need to come to the table with ideas that can make things better, and that's what we always try to do.
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That's great.
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And just personally, you came to this sector, but a bit about your background.
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Sure.
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So, you know, government politics is really all I've done and know how to do.
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And so, you know, my first job, I won't do the whole resume because we don't have time for that, but started working in the first Mike Harris term.
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I came back to work for Ernie Eve.
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So I worked for her for about eight years as premier, as we were the opposition and outside at the Just Neves Foundation after government was done.
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Moved from that, I think, started to feel like the pull towards public policy was there.
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And I was sort of at a crossroads of thinking, where do I go from here in terms of a career?
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Got into the world of government relations advocacy.
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So whether it's been working in the property casualty insurance, auto insurance industry, high cost credit, and now rental housing.
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So people say, you really know how to pick the good ones.
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But as you know, it's...
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It's going to be toward the consumers.
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Well, as you know, I mean, the industry, it's not tight soap I'm working for.
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industries that are heavily regulated, that perhaps have some issues in terms of public perception and need to have a strong voice. And I believe that that's important to all these sectors that I've worked in, including rental housing.
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Now, it's interesting. I didn't really know the statistic until fairly recently, but as much as 48% of Toronto's population lives in rental housing, which seems to be a fairly high number, it doesn't really surprise me, perhaps given the influx of people here over the last, you know, the last two decades, massive, massive growth, the fastest growing municipality in North America. So it wouldn't be surprising that as people come in, you know, they would rent at least, you know, to start with. Absolutely. That would make some sense. But how does rental affordability influence our ability to attract talent, to attract people and retain
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them in this, you know, in this region? It is critical, right? I mean, I think for Toronto to, you know, sort of thrive and to grow and to be everything that I think we want it to be now and into the future, we know that housing is such a critical component, right? It's so important that we have housing that is, you know, accessible and affordable to people with different incomes, with different needs. And we know that that's something that is definitely a challenge, right? I mean, we're not saying anything that isn't known by everyone. So, but I think in order to attract talent, to retain talent, you talked about, you know, for a lot of newcomers and young people, renting is where they start out. We're seeing through our own sort of data and speaking to members, and I think just anecdotally, renting has become something, a housing option that is now, you know, it's not necessarily something people do just for a few years. They may stay in renting longer. That's, of course, a complicated issue, or there's a number of moving parts to that.
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But I think regardless of what people do, where they live, we need rental housing to exist and to be affordable.
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And so I think for companies in Toronto, they want to be able to attract the best talent.
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They need to be able to say to potential recruits, we have housing available here, and you can afford it on what you're going to be earning when you start out, and you're going to be able to continue to carry through.
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I hear people say things to me like, isn't it interesting?
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You may have said this.
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Isn't it interesting that police officers and nurses, firefighters in Toronto can't live in Toronto?
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No, I mean, there's a huge problem.
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And I think we want them to be able to live in Toronto.
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And teachers to me as well.
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Absolutely.
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You've got a lot of people who we really value in our society.
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We need them.
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And they can't live anywhere near where they work.
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So how do we improve that situation?
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Because I think it's critically important that we do for the benefit of the city and all of its citizens.
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So when you think about, we talked in the beginning about the massive condo boom that took place here over 20 or 30 years.
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Now it's in a state of abeyance, let's put it that way.
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We're sitting here looking at an empty plot of land that will be two condo towers, I think, at some point.
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We'll see.
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But a lot of these projects are on hold.
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As I say, now everyone's talking about purpose-built rental.
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When you think about where we need to be from your perspective in the market, in the region, in the next, say, 10 years, what would you say?
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Are we halfway where we need to be?
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we where you know if you had the kind of the right from your perspective the right amount of capacity in purpose-built rental yeah where are we
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like we're on a journey about where we are and I don't know if I can quantify it in percentage terms but what I would say is as you pointed out I mean when I started in this industry eight years ago I asked a lot of questions like so what kind of rental apartments have been getting built in Toronto over the last few decades yeah it was like very few yeah and the ones that were built were high end. And that's because those are the only buildings that could work economically.
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And I started asking more questions. Why is that? So things like ending of the MERB program, the first MERB program, introduction of capital gains, taxes, other tax measures that made building purposeful rental housing economically very challenging. And so that then created this condo boom. And so we know that became the de facto rental market. And in my position, I firmly believe that housing of all types is really important. So I don't, it's not about No exclusives.
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We need it all.
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And we need missing middle.
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And we need single family.
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We need condominium.
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We need purpose of rental.
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We need all of it.
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So how much more of it do we need?
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I mean, there's people you can have in here, Mike Moffitts and others, who are probably better equipped to answer that.
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What I do know is that I think, and now we're at an interesting point, as I think you know and have pointed out, in terms of the fundamentals right now in the market, vacancy rates are up.
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Rents are coming down.
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People say to me, problem solved.
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we're good uh and give a gown in supply whether or not well but but so so right now those the those all those stats are true and i would say and and and and that's uh you know i acknowledge that that doesn't mean that we are our job is done no what because i firmly believe that immigration is critical to the success of our country we know that we had some challenges with on the immigration file i think some changes were made to address that we've gone from one potential you know extreme to another, there's going to have to be some meeting in the middle there. Some of these things are going to have to change in time. And when they do, we need the housing to be able, and for people that are going to come to Toronto, which we need to continue to attract to work in high tech and other sectors that are critically important, we need to be able to house them.
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And so I think a lot of times it seems to me the housing file, the focus is on the here and now, the today. And I think we both know of working government that we need to be looking longer term. And it doesn't matter what the fundamentals are saying today. I mean, they're important, but it doesn't matter relative to what the job we need to continue to do, which is to support the building of more housing and more rental housing.
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If we stop now and think we don't need to do anything, we're going to find ourselves in a very bad situation in five, six years when we haven't built anything and all of a sudden we're saying, wait a minute, what happened?
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How can we're back to where we were six years ago or seven years ago when we realized that we had a massive problem in terms of supply of housing?
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So when we talk about the chatter around who's built rental, Are we getting the action?
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Could we point to a lot of projects?
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As you said, you took this job on, you asked about rental, and you heard that there was very little built in the previous couple of decades.
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Are we seeing a huge boom in this, or is it more talk than actual?
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What are we seeing?
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So the last couple of years, and there are lots of stats out there that say that the number of...
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Now, a lot of this were condos, admittedly, that were delivered, that now need to be absorbed, and of course are not being absorbed in the ways that people who built them thought they would be.
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But there were, you know, we did see, and certainly we can also go back to the earlier years of the first forward term.
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You know, we were starting to see numbers go up.
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We were starting to see more starts, more completions.
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And I think that was due to some actions taken by the Ontario government then.
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And then in the last couple of years, the stats all show that we've had sort of a record number of deliveries of apartments, whether they be condo or a purpose of rental.
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So I think that's all true.
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What are we seeing right now, though?
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Because as you know, the projects that were delivered last year were all many years in the making to get there.
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So what's coming in the pipeline after?
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Not much.
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Oh, really?
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Not much.
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Because, again, think about the fundamentals existed with interest rates and other factors five years ago or four years ago when some of these projects were going through the entitlement process, getting shovels in the ground.
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While interest rates have come down a bit, we know that's still a pressure.
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But on interest rates, my sense is that we're kind of at historic levels in the sense of historic average levels.
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In other words, if you look at where we were in interest rates, at least until 2010, the Great Recession.
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After the Great Recession, we had massive drop down in interest rate levels.
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So we almost had free capital for maybe almost a decade, close to it.
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Then you had COVID.
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Then you had this spiraling up of inflation, high interest rates, and they've come down.
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But as I say, to me, they've kind of come down to where we might have been in the 90s, the 80s.
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We're not at a really high level.
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So that shouldn't be a factor, should it?
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I don't think it's certainly not a primary factor.
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The bigger factors, as you know, are development charges.
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Have they come off for purpose-filled rentals?
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What's that?
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Haven't they come off for purpose-filled rentals?
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So they're deferred.
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Okay.
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Oh, until the actual occupancy.
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Okay.
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So that's what is the case, and that does help.
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But, you know, and yes, there's been some relief in terms of GST on rentals.
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So some of those things definitely do help.
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But when I talk to my members, they tell me that, you know, the economic climate and perhaps this is also, you know, just general economic confidence, you know, investors willing to take risks, you know, CMHC, although that's all.
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All the different pieces are not necessarily lining up in a way that is that is.
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And still, the length of time it takes to see a project's approved while better is still not where it ought to be.
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So I think all those would just give me a sense of I mean, if you were building, you know, I don't know, there's probably no stereotype building, but say there were.
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uh you know what 20 stories 30 stories i don't know what it would be you know purpose built rental in toronto what would what would the permitting time be compared to what it should be like in your
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view well i mean i i think we you know realistically uh i think we'd love to see a scenario where we get through permitting in a year uh that's not certainly the case now uh right so it's still
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taking longer than that my understanding is that permitting is sped up in toronto in the last year in part because of the decline in the condo market.
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So that whereas City Hall was sort of deluged with applications for the last many, many years, that's kind of fallen off.
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And so they actually have, they're actually in a sense, better position to deal with the applications that they're getting.
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Are you seeing that?
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Yeah, I certainly am seeing, like in Toronto, I hear people say that, you know, the zoning process has gotten better.
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Certainly that's improved.
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So I do hear that.
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So I do hear some improvements.
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You know, ultimately, you know, I guess, as you would know, I mean, I sort of take, I hear a lot of information with a lot of different people, and you try to distill it, sort of understand what it means.
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And we are provincial, so there's a lot of different markets.
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And I know this is, we're really focused on Toronto and GTA here.
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There are improvements happening.
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But, you know, the message that I get from, and it's not to say that projects aren't moving forward.
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I have members who are absolutely putting shovels on the ground this year, moving forward on rental projects.
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So there is still building happening.
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The question is, is it how much?
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And is it enough?
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Is it what we need?
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And I'm not talking about the 1.5 million that was part of the, I'm not really, I know what that number, what you would need over a decade to meet that.
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I know that we are, we're far short of numbers.
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Far short of that.
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We're far short of that.
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So I'm not talking about that.
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But the question is, are we building enough to meet the demand?
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And this is what we need, whether it's data from StatsCan or from different agencies that project the you know the finance the population projections going forward what are we going to need to to fit to ensure that people the population will be will be adequately housed i don't know that
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we're there i don't think we're there it doesn't i didn't seem to what you're saying to me it doesn't sound like despite all the talk yeah that there's really a purpose-built rental boom going on well
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i mean is that room i don't know that i know i i'm not here i'm not hearing that there's a boom i'm hearing there's a boom in certain areas like halifax there's definitely a boom happening there there There are certain cities where we are seeing quite a bit of construction.
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Saskatoon, I was there in the summer, and there's absolutely a boom happening there.
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So there are some places where not here, but I wouldn't say there's a boom in Toronto.
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When I talk to my members, I hear a lot of angst.
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I hear a lot of uncertainty.
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I think there are people that are, you know, the uncertainty around government regulation is there.
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Are we going to see different things happening that might impact performance?
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So some people are kind of waiting to see what government's further actions might get taken.
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All that to say, there's a lot of pent up kind of, I think, anxiety on the sidelines and people who, you know, want to move forward, but, you know, just aren't doing it.
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And are there are there tools or is, you know, the government to you, we've talked a bit about some of the tools that governments have been using to try to to try to stimulate development.
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And some of that's regulatory streamlining. Some of that's, as we've said, faster permitting.
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some of its financial incentives, the deferral of the DCs, of the development charges, the removal of GST or HST from rental buildings.
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I'm not sure that's what you're suggesting is it may not be enough.
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So the question is, what do you think is needed?
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And let me ask you about one thing, which is the Ontario government, for example, has the Building Ontario Fund, quite a substantial fund.
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And it really is for infrastructure.
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And I see what they've done as a fair bit on student housing.
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they've done things on long-term care homes so where they're kind of pulling capital together sort of really bringing private capital in you know backstopped by by the building ontario fund
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yeah is there an opportunity in purpose-built rental for that great question uh i don't know i've not that's something i've come across my radar that they'll be through that but that's a good point maybe for us to yeah i just want to say quickly on on dcs because people say to me come You got the deferral. Isn't that good? But again, recognizing the economics of for rent product versus for sale.
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So deferral, because there's been a lot of talk about that.
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Yeah, it sounds like a big advantage.
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So for us, it doesn't mean anything because when you're looking at the pro forma, you're going to the lender.
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They don't recognize that. It still has to get paid.
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Yeah, at some point. It should not be paid up front.
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But it's being paid at occupancy. And it's not like you're selling units out to be able to collect money to pay them.
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So you're putting it off, but it's not.
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In terms of getting the loan, it doesn't.
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And it doesn't change the economics fundamentally.
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No, it doesn't change the economics fundamentally.
00:17:19.459 --> 00:17:20.220
That's still included.
00:17:20.959 --> 00:17:24.220
Those DCs are still included in the pro forma, which is, of course, take a look.
00:17:24.779 --> 00:17:25.599
And that's a big amount.
00:17:25.699 --> 00:17:34.559
I mean, in our housing conference recently that you spoke at, we said that the DCs, at least for homes now, is about $100,000 a home.
00:17:34.799 --> 00:17:37.440
Yes, I was reading some of your data, just PR and print, but paying for this.
00:17:37.480 --> 00:17:43.380
So to me, you know, development charges, I think, are, you know, a significant issue.
00:17:43.980 --> 00:17:46.299
We know that it's getting a lot more attention over the last couple of years.
00:17:46.480 --> 00:17:51.339
We worked with Mayor Brown on a bylaw, D.C. relief bylaw in Brampton.
00:17:51.720 --> 00:17:53.519
We know what's happened in Vaughan and other places.
00:17:53.960 --> 00:17:57.259
I know that a couple of years ago, if I'd had those conversations, I might have been thrown out of rooms.
00:17:58.019 --> 00:18:02.960
So clearly, there are more elected officials who recognize the issue around development.
00:18:03.000 --> 00:18:03.319
Oh, yeah.
00:18:03.359 --> 00:18:10.759
And in fact, we had Minister Rob Flack, the Ontario Municipal Affairs and Housing Minister, speak to us at the conference.
00:18:11.259 --> 00:18:56.680
And he hinted pretty strongly that he's looking for an alternative to development charges and recognizing that development charges are always grossly unfair because they are taking a new home, whether it's for rental or for sale, and saying the first person that buys that home or rents that home is in a sense paying for infrastructure, whether it's roads, whether it's transit, whether it's community centers in this area that are going to be used for many, many, many years. And so instead of amortizing that cost over many, many, many generations of homeowners or renters, it's coming on the shoulders of the first time, which doesn't make any sense at all. It doesn't. He recognizes that.
00:18:56.740 --> 00:19:07.140
So now he's looking for one of the different mechanisms that might be out there that would allow the amortization of cost over the 50 years or so that those services have been
00:19:07.160 --> 00:19:07.299
used.
00:19:07.299 --> 00:19:19.279
So you'd imagine we speak to the MH ministry regularly, and so whether it be the Municipal Service Corporation idea, which now will be piloted as a result of Bill 60 in Peel, so we'll see how that goes.
00:19:19.720 --> 00:19:21.299
Is it municipal bonds?
00:19:21.619 --> 00:19:23.519
Well, look at the U.S.
00:19:24.180 --> 00:19:32.519
If I have a pension plan in the US, a lot of chunk of it would be tax-free municipal
00:19:32.740 --> 00:19:32.799
bonds.
00:19:33.400 --> 00:19:34.880
So I think those are both good ideas.
00:19:35.039 --> 00:19:39.779
I think we need to all acknowledge that the development charge model is broken.
00:19:40.019 --> 00:19:41.839
It's overused.
00:19:42.259 --> 00:19:42.440
Yes.
00:19:42.619 --> 00:19:43.380
And just in a longer...
00:19:43.470 --> 00:19:45.619
Well, when it was created, everything was different.
00:19:46.019 --> 00:19:46.099
Yeah.
00:19:46.440 --> 00:19:48.759
And some things have a lifespan, just like apartments do.
00:19:49.119 --> 00:19:50.039
I think so does this.
00:19:50.700 --> 00:19:56.660
And so I think we all need to sort of acknowledge, and certainly I do, that we need a new model.
00:19:56.700 --> 00:19:59.460
We need a new system to pay for this development-related infrastructure.
00:19:59.859 --> 00:20:00.640
It's got to get paid for.
00:20:00.700 --> 00:20:01.559
No one would deny that.
00:20:01.799 --> 00:20:03.460
But the way it's paid for must change.
00:20:03.559 --> 00:20:03.839
Must change.
00:20:04.180 --> 00:20:05.839
We would completely agree with that as a board.
00:20:06.140 --> 00:20:06.319
Yeah.
00:20:06.839 --> 00:20:17.019
Anything else that you think about, we only got a couple of minutes left, that you would advise governments to do to open up the purpose-built rental market further?
00:20:17.480 --> 00:20:17.599
Yeah.
00:20:17.740 --> 00:20:22.660
So, you know, you mentioned earlier, we know that there are some condo developers looking to pivot.
00:20:23.019 --> 00:20:25.119
So that's so we will see how all that goes.
00:20:25.230 --> 00:20:28.839
We know we're seeing applications turn from from condo to personal rental.
00:20:29.400 --> 00:20:35.759
I think from my perspective, I mean, you know, I've said this before, but, you know, I think a couple of things.
00:20:35.900 --> 00:20:38.240
One, there still is a stigma about rental housing.
00:20:38.789 --> 00:20:39.180
There is.
00:20:39.460 --> 00:20:49.279
And so I think as a society, people who have a platform, who have an ability to, you know, to speak and be heard on this issue should be trying to do everything they can to disavow that.
00:20:49.680 --> 00:20:55.259
Right. We need you. You travel all over the world. A lot in a lot of parts of the world. Renting is absolutely accepted.
00:20:55.529 --> 00:21:08.559
And very common. It's very common. And so I think we need to continue to work on that because I still hear lots of stories, read media reports of examples where community groups fight to nail against any kind of rental development.
00:21:08.660 --> 00:21:15.539
and the idea that it brings, you know, property values down, brings in unwelcome people in neighborhoods, all that is nonsense.
00:21:15.750 --> 00:21:21.500
So I think we need to continue to recognize that that is a thought that many people still hold.
00:21:21.809 --> 00:21:28.680
And we're not going to be able to move forward in the way we need to unless we can somehow continue to work on trying to dispel some of that.
00:21:28.750 --> 00:21:30.660
So I would say that's one thing I would say for sure.
00:21:31.160 --> 00:21:39.740
And then I think in terms of the regulatory point of view, I mean, I don't want to talk out of both sides of my mouth, but I think in a lot of times government needs to get out of the way.
00:21:40.059 --> 00:21:58.539
I do think that's, you know, when you look at all the studies, all the different ministries who are involved in applications, conservation, environment, you know, hydro, like we need to figure out how to continue to streamline the process so that it can be done more quickly.
00:21:59.079 --> 00:22:03.579
But at the end of the day, Giles, I mean, the only way that will happen is if people actually want it to happen.
00:22:04.019 --> 00:22:31.579
If the political will is there, if people say, you know what, this is important. We need for the city to thrive and to be able to attract the best talents to Toronto. We need to have more housing. That's not a bad word. It's not a bad word to have rental housing. So we need people to get on board and to recognize that doing it faster is not cutting corners. It doesn't mean it's not going to be done properly, but it's become too embedded, too layered on with process. So a bit of a reset is what you're saying. I think so.
00:22:31.599 --> 00:22:32.420
I think so.
00:22:32.890 --> 00:22:46.000
Last question, because one of the knocks against the condo boom was that as part of the financing structure of condos, was over time these condo units became smaller and smaller and smaller and smaller.
00:22:46.420 --> 00:22:54.900
And you ended up with these sort of 500 square feet, 600 square feet units, which of course are not fit for really more than a single individual, maybe a couple, but certainly not a family.
00:22:55.359 --> 00:23:07.099
And in fact, we've seen 80,000 people a year leaving Toronto now, mostly couples with small kids, with small families, so young families, because they couldn't find a place to live.
00:23:07.640 --> 00:23:20.839
In the rental, as we look towards rental, and as you're saying, and your point about making it more common, making the whole idea of rental completely commonplace, no stigma attached to it and so on, and there shouldn't be.
00:23:22.119 --> 00:23:29.759
But for that to happen, it seems to me that the rental units are going to have to solve the problem that condos didn't, which is to have larger units.
00:23:29.930 --> 00:23:30.599
Is that possible?
00:23:30.980 --> 00:23:31.740
I think it is possible.
00:23:31.789 --> 00:23:37.500
We have members who do build larger units as their business model, but guess where they don't build them?
00:23:38.140 --> 00:23:38.460
In Toronto.
00:23:38.799 --> 00:23:38.960
Yeah.
00:23:39.200 --> 00:23:47.059
So it can happen, but the places where it does happen now, development charges aren't the same kind of problem.
00:23:48.099 --> 00:23:50.140
It's time to still be an issue, but there are other factors.
00:23:50.619 --> 00:23:51.460
Land's not as expensive.
00:23:51.759 --> 00:23:54.079
And I realize that's another important issue.
00:23:54.240 --> 00:24:00.660
But we do have members in the city, I can think of one, who everything they've built over the last few years has been all on existing sites.
00:24:01.140 --> 00:24:02.119
Unicorn sites, I call them.
00:24:02.119 --> 00:24:09.299
I've talked about the board before, where they already have a building in these garden-style, kind of garden-in-a-park sort of apartments that were built in the 60s and 70s.
00:24:09.579 --> 00:24:10.140
Lots of land.
00:24:10.140 --> 00:24:11.480
They can build another tower or two.
00:24:11.900 --> 00:24:12.779
We should be exploring those.
00:24:12.839 --> 00:24:13.940
They should be approved very quickly.
00:24:14.180 --> 00:24:19.259
Are those family-sized units in general, or are they building small units around family units?
00:24:19.640 --> 00:24:21.880
Well, I mean, again, I think it's a combination of both.
00:24:22.019 --> 00:24:30.220
But my point just is it can happen, but I think we need to, again, get out of the way in terms of some of the red tape and regulation and allow people to do what they do best, which is build.
00:24:30.559 --> 00:24:33.359
And if the need is there, we will meet the need.
00:24:33.500 --> 00:24:34.799
That's what we do, and we'll meet that need.
00:24:34.799 --> 00:24:39.019
If we know that more family units are what's required, we'll deliver that.
00:24:39.200 --> 00:24:40.799
But we need the government to work with us.
00:24:40.819 --> 00:24:41.859
I need to signal this up.
00:24:42.299 --> 00:24:42.420
Yeah.
00:24:42.960 --> 00:24:43.059
Yeah.
00:24:43.440 --> 00:24:44.180
Tony, thank you very much.
00:24:44.380 --> 00:24:44.880
Great conversation.
00:24:45.079 --> 00:24:46.900
It could have gone on for another hour, probably.
00:24:47.660 --> 00:24:48.619
But thank you for your time.
00:24:48.779 --> 00:24:49.059
Thank you.
00:24:49.180 --> 00:24:51.680
the rich conversation. It was great being with you. Thanks very much. Thank you. Thanks.
00:24:54.059 --> 00:25:01.839
Thanks for listening to Toronto Talks, conversations with the leaders shaping the region's economy. Follow us wherever you get your podcasts.
00:00:00.059 --> 00:00:05.660
Isn't it interesting that police officers and nurses, firefighters in Toronto can't live in Toronto?
00:00:05.660 --> 00:00:06.559
No, I mean, there's a huge problem.
00:00:06.650 --> 00:00:08.699
And I think we want them to be able to live in Toronto.
00:00:10.019 --> 00:00:15.539
Hello, I'm Giles Gerson, and this is Toronto Talks, the voice of Toronto's business community.
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What are we talking about?
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Each episode is a conversation with top business leaders about how they're shaping growth, driving competitiveness, and building up our economy.
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It's about what they believe it will take to make sure the Toronto region remains one of the world's great global cities.
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Here's today's conversation.
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Tony, great to have you here for our Toronto Talks episode.
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Really excited to have a conversation about rental housing because that's something that, I mean, it's kind of interesting.
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We've gone through this condo boom in Toronto over the last 20 years, and all anybody talked about were condos.
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Now we're in a bit of a, I don't know it's too strong a word to say, collapse at the condo market, at least temporarily.
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And everyone's talking rental.
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Maybe just talk for our audience a bit about the organization.
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Sure.
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You know, the Federation of Rental Housing Providers of Ontario.
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Yep.
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Been around a long time.
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Yep.
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But maybe a few, you know, hum a few bars about that.
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Great.
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Thanks for having me.
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It's great to be here with you.
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Today, great conversation I know we'll have.
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So FERPO, Federation of Rental Housing Providers of Ontario, that's the word solid for sure.
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1985, it is. I'd like to shorten it, but that's not a conversation for another day.
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40 years old, 2,200 members.
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That's owners, builders, managers, suppliers to the industry, sort of the whole gambit.
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And so we are the largest association that advocates for strong and stable purpose-built rental housing in Ontario.
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I think we have a long and positive track record of collaborating with governments of various stripes, really to ensure that our members have a seat at the table.
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The association was created sort of coming out of rent control in the 1970s.
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I think at that time, owners felt there was a need to come together with other like-minded individuals and organizations to have a voice.
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So that's where it all started.
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And since then, our mission really hasn't changed much over the 40 years, I would say.
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in that it remains to be one of a trusted voice to government who government will reach out to, talk to, hear the issues, but also hear the solutions.
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And I think you've heard me talk about that, and I think it's vitally important.
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Everyone likes to criticize, but you need to come to the table with ideas that can make things better, and that's what we always try to do.
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That's great.
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And just personally, you came to this sector, but a bit about your background.
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Sure.
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So, you know, government politics is really all I've done and know how to do.
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And so, you know, my first job, I won't do the whole resume because we don't have time for that, but started working in the first Mike Harris term.
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I came back to work for Ernie Eve.
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So I worked for her for about eight years as premier, as we were the opposition and outside at the Just Neves Foundation after government was done.
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Moved from that, I think, started to feel like the pull towards public policy was there.
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And I was sort of at a crossroads of thinking, where do I go from here in terms of a career?
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Got into the world of government relations advocacy.
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So whether it's been working in the property casualty insurance, auto insurance industry, high cost credit, and now rental housing.
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So people say, you really know how to pick the good ones.
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But as you know, it's...
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It's going to be toward the consumers.
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Well, as you know, I mean, the industry, it's not tight soap I'm working for.
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industries that are heavily regulated, that perhaps have some issues in terms of public perception and need to have a strong voice. And I believe that that's important to all these sectors that I've worked in, including rental housing.
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Now, it's interesting. I didn't really know the statistic until fairly recently, but as much as 48% of Toronto's population lives in rental housing, which seems to be a fairly high number, it doesn't really surprise me, perhaps given the influx of people here over the last, you know, the last two decades, massive, massive growth, the fastest growing municipality in North America. So it wouldn't be surprising that as people come in, you know, they would rent at least, you know, to start with. Absolutely. That would make some sense. But how does rental affordability influence our ability to attract talent, to attract people and retain
00:04:21.298 --> 00:05:16.899
them in this, you know, in this region? It is critical, right? I mean, I think for Toronto to, you know, sort of thrive and to grow and to be everything that I think we want it to be now and into the future, we know that housing is such a critical component, right? It's so important that we have housing that is, you know, accessible and affordable to people with different incomes, with different needs. And we know that that's something that is definitely a challenge, right? I mean, we're not saying anything that isn't known by everyone. So, but I think in order to attract talent, to retain talent, you talked about, you know, for a lot of newcomers and young people, renting is where they start out. We're seeing through our own sort of data and speaking to members, and I think just anecdotally, renting has become something, a housing option that is now, you know, it's not necessarily something people do just for a few years. They may stay in renting longer. That's, of course, a complicated issue, or there's a number of moving parts to that.
00:05:17.259 --> 00:05:23.740
But I think regardless of what people do, where they live, we need rental housing to exist and to be affordable.
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And so I think for companies in Toronto, they want to be able to attract the best talent.
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They need to be able to say to potential recruits, we have housing available here, and you can afford it on what you're going to be earning when you start out, and you're going to be able to continue to carry through.
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I hear people say things to me like, isn't it interesting?
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You may have said this.
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Isn't it interesting that police officers and nurses, firefighters in Toronto can't live in Toronto?
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No, I mean, there's a huge problem.
00:05:49.800 --> 00:05:51.759
And I think we want them to be able to live in Toronto.
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And teachers to me as well.
00:05:53.240 --> 00:05:53.500
Absolutely.
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You've got a lot of people who we really value in our society.
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We need them.
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And they can't live anywhere near where they work.
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So how do we improve that situation?
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Because I think it's critically important that we do for the benefit of the city and all of its citizens.
00:06:06.860 --> 00:06:13.180
So when you think about, we talked in the beginning about the massive condo boom that took place here over 20 or 30 years.
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Now it's in a state of abeyance, let's put it that way.
00:06:17.899 --> 00:06:24.199
We're sitting here looking at an empty plot of land that will be two condo towers, I think, at some point.
00:06:24.500 --> 00:06:25.019
We'll see.
00:06:25.480 --> 00:06:27.579
But a lot of these projects are on hold.
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As I say, now everyone's talking about purpose-built rental.
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When you think about where we need to be from your perspective in the market, in the region, in the next, say, 10 years, what would you say?
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Are we halfway where we need to be?
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we where you know if you had the kind of the right from your perspective the right amount of capacity in purpose-built rental yeah where are we
00:06:55.050 --> 00:07:15.959
like we're on a journey about where we are and I don't know if I can quantify it in percentage terms but what I would say is as you pointed out I mean when I started in this industry eight years ago I asked a lot of questions like so what kind of rental apartments have been getting built in Toronto over the last few decades yeah it was like very few yeah and the ones that were built were high end. And that's because those are the only buildings that could work economically.
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And I started asking more questions. Why is that? So things like ending of the MERB program, the first MERB program, introduction of capital gains, taxes, other tax measures that made building purposeful rental housing economically very challenging. And so that then created this condo boom. And so we know that became the de facto rental market. And in my position, I firmly believe that housing of all types is really important. So I don't, it's not about No exclusives.
00:07:42.459 --> 00:07:43.100
We need it all.
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And we need missing middle.
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And we need single family.
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We need condominium.
00:07:47.490 --> 00:07:48.220
We need purpose of rental.
00:07:48.269 --> 00:07:49.019
We need all of it.
00:07:49.500 --> 00:07:51.000
So how much more of it do we need?
00:07:51.069 --> 00:07:56.120
I mean, there's people you can have in here, Mike Moffitts and others, who are probably better equipped to answer that.
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What I do know is that I think, and now we're at an interesting point, as I think you know and have pointed out, in terms of the fundamentals right now in the market, vacancy rates are up.
00:08:08.899 --> 00:08:09.779
Rents are coming down.
00:08:09.980 --> 00:08:11.120
People say to me, problem solved.
00:08:11.620 --> 00:08:53.740
we're good uh and give a gown in supply whether or not well but but so so right now those the those all those stats are true and i would say and and and and that's uh you know i acknowledge that that doesn't mean that we are our job is done no what because i firmly believe that immigration is critical to the success of our country we know that we had some challenges with on the immigration file i think some changes were made to address that we've gone from one potential you know extreme to another, there's going to have to be some meeting in the middle there. Some of these things are going to have to change in time. And when they do, we need the housing to be able, and for people that are going to come to Toronto, which we need to continue to attract to work in high tech and other sectors that are critically important, we need to be able to house them.
00:08:54.179 --> 00:09:14.759
And so I think a lot of times it seems to me the housing file, the focus is on the here and now, the today. And I think we both know of working government that we need to be looking longer term. And it doesn't matter what the fundamentals are saying today. I mean, they're important, but it doesn't matter relative to what the job we need to continue to do, which is to support the building of more housing and more rental housing.
00:09:15.120 --> 00:09:23.100
If we stop now and think we don't need to do anything, we're going to find ourselves in a very bad situation in five, six years when we haven't built anything and all of a sudden we're saying, wait a minute, what happened?
00:09:23.460 --> 00:09:30.820
How can we're back to where we were six years ago or seven years ago when we realized that we had a massive problem in terms of supply of housing?
00:09:31.120 --> 00:09:38.620
So when we talk about the chatter around who's built rental, Are we getting the action?
00:09:39.039 --> 00:09:41.840
Could we point to a lot of projects?
00:09:41.970 --> 00:09:48.259
As you said, you took this job on, you asked about rental, and you heard that there was very little built in the previous couple of decades.
00:09:49.500 --> 00:09:52.360
Are we seeing a huge boom in this, or is it more talk than actual?
00:09:52.429 --> 00:09:52.860
What are we seeing?
00:09:53.370 --> 00:09:57.159
So the last couple of years, and there are lots of stats out there that say that the number of...
00:09:57.159 --> 00:10:05.320
Now, a lot of this were condos, admittedly, that were delivered, that now need to be absorbed, and of course are not being absorbed in the ways that people who built them thought they would be.
00:10:05.519 --> 00:10:12.440
But there were, you know, we did see, and certainly we can also go back to the earlier years of the first forward term.
00:10:13.399 --> 00:10:15.100
You know, we were starting to see numbers go up.
00:10:15.100 --> 00:10:17.840
We were starting to see more starts, more completions.
00:10:18.120 --> 00:10:20.960
And I think that was due to some actions taken by the Ontario government then.
00:10:21.399 --> 00:10:29.559
And then in the last couple of years, the stats all show that we've had sort of a record number of deliveries of apartments, whether they be condo or a purpose of rental.
00:10:30.000 --> 00:10:30.820
So I think that's all true.
00:10:31.500 --> 00:10:32.779
What are we seeing right now, though?
00:10:32.860 --> 00:10:38.179
Because as you know, the projects that were delivered last year were all many years in the making to get there.
00:10:38.500 --> 00:10:40.080
So what's coming in the pipeline after?
00:10:40.620 --> 00:10:40.919
Not much.
00:10:41.360 --> 00:10:41.740
Oh, really?
00:10:41.899 --> 00:10:42.179
Not much.
00:10:42.320 --> 00:10:52.860
Because, again, think about the fundamentals existed with interest rates and other factors five years ago or four years ago when some of these projects were going through the entitlement process, getting shovels in the ground.
00:10:53.379 --> 00:10:56.519
While interest rates have come down a bit, we know that's still a pressure.
00:10:57.240 --> 00:11:02.759
But on interest rates, my sense is that we're kind of at historic levels in the sense of historic average levels.
00:11:02.840 --> 00:11:09.240
In other words, if you look at where we were in interest rates, at least until 2010, the Great Recession.
00:11:09.919 --> 00:11:12.820
After the Great Recession, we had massive drop down in interest rate levels.
00:11:13.000 --> 00:11:16.320
So we almost had free capital for maybe almost a decade, close to it.
00:11:16.740 --> 00:11:17.399
Then you had COVID.
00:11:18.039 --> 00:11:22.019
Then you had this spiraling up of inflation, high interest rates, and they've come down.
00:11:22.340 --> 00:11:27.379
But as I say, to me, they've kind of come down to where we might have been in the 90s, the 80s.
00:11:28.360 --> 00:11:29.740
We're not at a really high level.
00:11:30.580 --> 00:11:32.360
So that shouldn't be a factor, should it?
00:11:32.379 --> 00:11:34.720
I don't think it's certainly not a primary factor.
00:11:34.779 --> 00:11:36.840
The bigger factors, as you know, are development charges.
00:11:37.480 --> 00:11:39.080
Have they come off for purpose-filled rentals?
00:11:39.299 --> 00:11:39.539
What's that?
00:11:40.159 --> 00:11:41.779
Haven't they come off for purpose-filled rentals?
00:11:42.039 --> 00:11:44.139
So they're deferred.
00:11:45.279 --> 00:11:45.500
Okay.
00:11:45.840 --> 00:11:48.659
Oh, until the actual occupancy.
00:11:48.960 --> 00:11:49.179
Okay.
00:11:50.100 --> 00:11:53.019
So that's what is the case, and that does help.
00:11:53.840 --> 00:11:57.759
But, you know, and yes, there's been some relief in terms of GST on rentals.
00:11:57.799 --> 00:12:00.399
So some of those things definitely do help.
00:12:00.460 --> 00:12:13.299
But when I talk to my members, they tell me that, you know, the economic climate and perhaps this is also, you know, just general economic confidence, you know, investors willing to take risks, you know, CMHC, although that's all.
00:12:13.389 --> 00:12:17.700
All the different pieces are not necessarily lining up in a way that is that is.
00:12:17.799 --> 00:12:23.139
And still, the length of time it takes to see a project's approved while better is still not where it ought to be.
00:12:23.250 --> 00:12:29.980
So I think all those would just give me a sense of I mean, if you were building, you know, I don't know, there's probably no stereotype building, but say there were.
00:12:30.080 --> 00:12:40.179
uh you know what 20 stories 30 stories i don't know what it would be you know purpose built rental in toronto what would what would the permitting time be compared to what it should be like in your
00:12:40.230 --> 00:12:52.220
view well i mean i i think we you know realistically uh i think we'd love to see a scenario where we get through permitting in a year uh that's not certainly the case now uh right so it's still
00:12:52.340 --> 00:12:58.620
taking longer than that my understanding is that permitting is sped up in toronto in the last year in part because of the decline in the condo market.
00:12:58.759 --> 00:13:06.299
So that whereas City Hall was sort of deluged with applications for the last many, many years, that's kind of fallen off.
00:13:06.460 --> 00:13:13.679
And so they actually have, they're actually in a sense, better position to deal with the applications that they're getting.
00:13:13.740 --> 00:13:14.360
Are you seeing that?
00:13:14.519 --> 00:13:18.879
Yeah, I certainly am seeing, like in Toronto, I hear people say that, you know, the zoning process has gotten better.
00:13:19.200 --> 00:13:20.259
Certainly that's improved.
00:13:20.700 --> 00:13:21.639
So I do hear that.
00:13:21.659 --> 00:13:22.799
So I do hear some improvements.
00:13:23.720 --> 00:13:33.080
You know, ultimately, you know, I guess, as you would know, I mean, I sort of take, I hear a lot of information with a lot of different people, and you try to distill it, sort of understand what it means.
00:13:33.429 --> 00:13:35.320
And we are provincial, so there's a lot of different markets.
00:13:35.769 --> 00:13:38.580
And I know this is, we're really focused on Toronto and GTA here.
00:13:38.970 --> 00:13:40.039
There are improvements happening.
00:13:40.860 --> 00:13:47.419
But, you know, the message that I get from, and it's not to say that projects aren't moving forward.
00:13:47.500 --> 00:13:51.500
I have members who are absolutely putting shovels on the ground this year, moving forward on rental projects.
00:13:51.639 --> 00:13:53.179
So there is still building happening.
00:13:53.700 --> 00:13:55.720
The question is, is it how much?
00:13:55.809 --> 00:13:56.759
And is it enough?
00:13:56.809 --> 00:13:57.659
Is it what we need?
00:13:57.950 --> 00:14:07.240
And I'm not talking about the 1.5 million that was part of the, I'm not really, I know what that number, what you would need over a decade to meet that.
00:14:07.820 --> 00:14:09.899
I know that we are, we're far short of numbers.
00:14:10.200 --> 00:14:10.700
Far short of that.
00:14:10.779 --> 00:14:11.480
We're far short of that.
00:14:11.509 --> 00:14:12.440
So I'm not talking about that.
00:14:12.529 --> 00:14:16.799
But the question is, are we building enough to meet the demand?
00:14:16.889 --> 00:14:33.179
And this is what we need, whether it's data from StatsCan or from different agencies that project the you know the finance the population projections going forward what are we going to need to to fit to ensure that people the population will be will be adequately housed i don't know that
00:14:33.259 --> 00:14:43.200
we're there i don't think we're there it doesn't i didn't seem to what you're saying to me it doesn't sound like despite all the talk yeah that there's really a purpose-built rental boom going on well
00:14:43.309 --> 00:14:55.799
i mean is that room i don't know that i know i i'm not here i'm not hearing that there's a boom i'm hearing there's a boom in certain areas like halifax there's definitely a boom happening there there There are certain cities where we are seeing quite a bit of construction.
00:14:56.600 --> 00:15:00.179
Saskatoon, I was there in the summer, and there's absolutely a boom happening there.
00:15:00.529 --> 00:15:03.899
So there are some places where not here, but I wouldn't say there's a boom in Toronto.
00:15:04.110 --> 00:15:06.840
When I talk to my members, I hear a lot of angst.
00:15:06.870 --> 00:15:08.580
I hear a lot of uncertainty.
00:15:08.970 --> 00:15:14.639
I think there are people that are, you know, the uncertainty around government regulation is there.
00:15:15.200 --> 00:15:19.019
Are we going to see different things happening that might impact performance?
00:15:19.279 --> 00:15:23.240
So some people are kind of waiting to see what government's further actions might get taken.
00:15:23.720 --> 00:15:33.480
All that to say, there's a lot of pent up kind of, I think, anxiety on the sidelines and people who, you know, want to move forward, but, you know, just aren't doing it.
00:15:33.539 --> 00:15:41.500
And are there are there tools or is, you know, the government to you, we've talked a bit about some of the tools that governments have been using to try to to try to stimulate development.
00:15:42.340 --> 00:15:45.620
And some of that's regulatory streamlining. Some of that's, as we've said, faster permitting.
00:15:46.259 --> 00:15:56.820
some of its financial incentives, the deferral of the DCs, of the development charges, the removal of GST or HST from rental buildings.
00:15:58.600 --> 00:16:01.100
I'm not sure that's what you're suggesting is it may not be enough.
00:16:01.580 --> 00:16:04.580
So the question is, what do you think is needed?
00:16:04.879 --> 00:16:11.919
And let me ask you about one thing, which is the Ontario government, for example, has the Building Ontario Fund, quite a substantial fund.
00:16:12.480 --> 00:16:13.779
And it really is for infrastructure.
00:16:13.840 --> 00:16:15.919
And I see what they've done as a fair bit on student housing.
00:16:16.320 --> 00:16:27.200
they've done things on long-term care homes so where they're kind of pulling capital together sort of really bringing private capital in you know backstopped by by the building ontario fund
00:16:27.279 --> 00:16:49.460
yeah is there an opportunity in purpose-built rental for that great question uh i don't know i've not that's something i've come across my radar that they'll be through that but that's a good point maybe for us to yeah i just want to say quickly on on dcs because people say to me come You got the deferral. Isn't that good? But again, recognizing the economics of for rent product versus for sale.
00:16:50.159 --> 00:16:52.600
So deferral, because there's been a lot of talk about that.
00:16:52.740 --> 00:16:55.419
Yeah, it sounds like a big advantage.
00:16:55.559 --> 00:17:00.600
So for us, it doesn't mean anything because when you're looking at the pro forma, you're going to the lender.
00:17:01.200 --> 00:17:03.279
They don't recognize that. It still has to get paid.
00:17:03.399 --> 00:17:05.279
Yeah, at some point. It should not be paid up front.
00:17:05.420 --> 00:17:10.720
But it's being paid at occupancy. And it's not like you're selling units out to be able to collect money to pay them.
00:17:10.818 --> 00:17:13.779
So you're putting it off, but it's not.
00:17:13.828 --> 00:17:15.160
In terms of getting the loan, it doesn't.
00:17:15.740 --> 00:17:17.180
And it doesn't change the economics fundamentally.
00:17:17.420 --> 00:17:18.759
No, it doesn't change the economics fundamentally.
00:17:19.459 --> 00:17:20.220
That's still included.
00:17:20.959 --> 00:17:24.220
Those DCs are still included in the pro forma, which is, of course, take a look.
00:17:24.779 --> 00:17:25.599
And that's a big amount.
00:17:25.699 --> 00:17:34.559
I mean, in our housing conference recently that you spoke at, we said that the DCs, at least for homes now, is about $100,000 a home.
00:17:34.799 --> 00:17:37.440
Yes, I was reading some of your data, just PR and print, but paying for this.
00:17:37.480 --> 00:17:43.380
So to me, you know, development charges, I think, are, you know, a significant issue.
00:17:43.980 --> 00:17:46.299
We know that it's getting a lot more attention over the last couple of years.
00:17:46.480 --> 00:17:51.339
We worked with Mayor Brown on a bylaw, D.C. relief bylaw in Brampton.
00:17:51.720 --> 00:17:53.519
We know what's happened in Vaughan and other places.
00:17:53.960 --> 00:17:57.259
I know that a couple of years ago, if I'd had those conversations, I might have been thrown out of rooms.
00:17:58.019 --> 00:18:02.960
So clearly, there are more elected officials who recognize the issue around development.
00:18:03.000 --> 00:18:03.319
Oh, yeah.
00:18:03.359 --> 00:18:10.759
And in fact, we had Minister Rob Flack, the Ontario Municipal Affairs and Housing Minister, speak to us at the conference.
00:18:11.259 --> 00:18:56.680
And he hinted pretty strongly that he's looking for an alternative to development charges and recognizing that development charges are always grossly unfair because they are taking a new home, whether it's for rental or for sale, and saying the first person that buys that home or rents that home is in a sense paying for infrastructure, whether it's roads, whether it's transit, whether it's community centers in this area that are going to be used for many, many, many years. And so instead of amortizing that cost over many, many, many generations of homeowners or renters, it's coming on the shoulders of the first time, which doesn't make any sense at all. It doesn't. He recognizes that.
00:18:56.740 --> 00:19:07.140
So now he's looking for one of the different mechanisms that might be out there that would allow the amortization of cost over the 50 years or so that those services have been
00:19:07.160 --> 00:19:07.299
used.
00:19:07.299 --> 00:19:19.279
So you'd imagine we speak to the MH ministry regularly, and so whether it be the Municipal Service Corporation idea, which now will be piloted as a result of Bill 60 in Peel, so we'll see how that goes.
00:19:19.720 --> 00:19:21.299
Is it municipal bonds?
00:19:21.619 --> 00:19:23.519
Well, look at the U.S.
00:19:24.180 --> 00:19:32.519
If I have a pension plan in the US, a lot of chunk of it would be tax-free municipal
00:19:32.740 --> 00:19:32.799
bonds.
00:19:33.400 --> 00:19:34.880
So I think those are both good ideas.
00:19:35.039 --> 00:19:39.779
I think we need to all acknowledge that the development charge model is broken.
00:19:40.019 --> 00:19:41.839
It's overused.
00:19:42.259 --> 00:19:42.440
Yes.
00:19:42.619 --> 00:19:43.380
And just in a longer...
00:19:43.470 --> 00:19:45.619
Well, when it was created, everything was different.
00:19:46.019 --> 00:19:46.099
Yeah.
00:19:46.440 --> 00:19:48.759
And some things have a lifespan, just like apartments do.
00:19:49.119 --> 00:19:50.039
I think so does this.
00:19:50.700 --> 00:19:56.660
And so I think we all need to sort of acknowledge, and certainly I do, that we need a new model.
00:19:56.700 --> 00:19:59.460
We need a new system to pay for this development-related infrastructure.
00:19:59.859 --> 00:20:00.640
It's got to get paid for.
00:20:00.700 --> 00:20:01.559
No one would deny that.
00:20:01.799 --> 00:20:03.460
But the way it's paid for must change.
00:20:03.559 --> 00:20:03.839
Must change.
00:20:04.180 --> 00:20:05.839
We would completely agree with that as a board.
00:20:06.140 --> 00:20:06.319
Yeah.
00:20:06.839 --> 00:20:17.019
Anything else that you think about, we only got a couple of minutes left, that you would advise governments to do to open up the purpose-built rental market further?
00:20:17.480 --> 00:20:17.599
Yeah.
00:20:17.740 --> 00:20:22.660
So, you know, you mentioned earlier, we know that there are some condo developers looking to pivot.
00:20:23.019 --> 00:20:25.119
So that's so we will see how all that goes.
00:20:25.230 --> 00:20:28.839
We know we're seeing applications turn from from condo to personal rental.
00:20:29.400 --> 00:20:35.759
I think from my perspective, I mean, you know, I've said this before, but, you know, I think a couple of things.
00:20:35.900 --> 00:20:38.240
One, there still is a stigma about rental housing.
00:20:38.789 --> 00:20:39.180
There is.
00:20:39.460 --> 00:20:49.279
And so I think as a society, people who have a platform, who have an ability to, you know, to speak and be heard on this issue should be trying to do everything they can to disavow that.
00:20:49.680 --> 00:20:55.259
Right. We need you. You travel all over the world. A lot in a lot of parts of the world. Renting is absolutely accepted.
00:20:55.529 --> 00:21:08.559
And very common. It's very common. And so I think we need to continue to work on that because I still hear lots of stories, read media reports of examples where community groups fight to nail against any kind of rental development.
00:21:08.660 --> 00:21:15.539
and the idea that it brings, you know, property values down, brings in unwelcome people in neighborhoods, all that is nonsense.
00:21:15.750 --> 00:21:21.500
So I think we need to continue to recognize that that is a thought that many people still hold.
00:21:21.809 --> 00:21:28.680
And we're not going to be able to move forward in the way we need to unless we can somehow continue to work on trying to dispel some of that.
00:21:28.750 --> 00:21:30.660
So I would say that's one thing I would say for sure.
00:21:31.160 --> 00:21:39.740
And then I think in terms of the regulatory point of view, I mean, I don't want to talk out of both sides of my mouth, but I think in a lot of times government needs to get out of the way.
00:21:40.059 --> 00:21:58.539
I do think that's, you know, when you look at all the studies, all the different ministries who are involved in applications, conservation, environment, you know, hydro, like we need to figure out how to continue to streamline the process so that it can be done more quickly.
00:21:59.079 --> 00:22:03.579
But at the end of the day, Giles, I mean, the only way that will happen is if people actually want it to happen.
00:22:04.019 --> 00:22:31.579
If the political will is there, if people say, you know what, this is important. We need for the city to thrive and to be able to attract the best talents to Toronto. We need to have more housing. That's not a bad word. It's not a bad word to have rental housing. So we need people to get on board and to recognize that doing it faster is not cutting corners. It doesn't mean it's not going to be done properly, but it's become too embedded, too layered on with process. So a bit of a reset is what you're saying. I think so.
00:22:31.599 --> 00:22:32.420
I think so.
00:22:32.890 --> 00:22:46.000
Last question, because one of the knocks against the condo boom was that as part of the financing structure of condos, was over time these condo units became smaller and smaller and smaller and smaller.
00:22:46.420 --> 00:22:54.900
And you ended up with these sort of 500 square feet, 600 square feet units, which of course are not fit for really more than a single individual, maybe a couple, but certainly not a family.
00:22:55.359 --> 00:23:07.099
And in fact, we've seen 80,000 people a year leaving Toronto now, mostly couples with small kids, with small families, so young families, because they couldn't find a place to live.
00:23:07.640 --> 00:23:20.839
In the rental, as we look towards rental, and as you're saying, and your point about making it more common, making the whole idea of rental completely commonplace, no stigma attached to it and so on, and there shouldn't be.
00:23:22.119 --> 00:23:29.759
But for that to happen, it seems to me that the rental units are going to have to solve the problem that condos didn't, which is to have larger units.
00:23:29.930 --> 00:23:30.599
Is that possible?
00:23:30.980 --> 00:23:31.740
I think it is possible.
00:23:31.789 --> 00:23:37.500
We have members who do build larger units as their business model, but guess where they don't build them?
00:23:38.140 --> 00:23:38.460
In Toronto.
00:23:38.799 --> 00:23:38.960
Yeah.
00:23:39.200 --> 00:23:47.059
So it can happen, but the places where it does happen now, development charges aren't the same kind of problem.
00:23:48.099 --> 00:23:50.140
It's time to still be an issue, but there are other factors.
00:23:50.619 --> 00:23:51.460
Land's not as expensive.
00:23:51.759 --> 00:23:54.079
And I realize that's another important issue.
00:23:54.240 --> 00:24:00.660
But we do have members in the city, I can think of one, who everything they've built over the last few years has been all on existing sites.
00:24:01.140 --> 00:24:02.119
Unicorn sites, I call them.
00:24:02.119 --> 00:24:09.299
I've talked about the board before, where they already have a building in these garden-style, kind of garden-in-a-park sort of apartments that were built in the 60s and 70s.
00:24:09.579 --> 00:24:10.140
Lots of land.
00:24:10.140 --> 00:24:11.480
They can build another tower or two.
00:24:11.900 --> 00:24:12.779
We should be exploring those.
00:24:12.839 --> 00:24:13.940
They should be approved very quickly.
00:24:14.180 --> 00:24:19.259
Are those family-sized units in general, or are they building small units around family units?
00:24:19.640 --> 00:24:21.880
Well, I mean, again, I think it's a combination of both.
00:24:22.019 --> 00:24:30.220
But my point just is it can happen, but I think we need to, again, get out of the way in terms of some of the red tape and regulation and allow people to do what they do best, which is build.
00:24:30.559 --> 00:24:33.359
And if the need is there, we will meet the need.
00:24:33.500 --> 00:24:34.799
That's what we do, and we'll meet that need.
00:24:34.799 --> 00:24:39.019
If we know that more family units are what's required, we'll deliver that.
00:24:39.200 --> 00:24:40.799
But we need the government to work with us.
00:24:40.819 --> 00:24:41.859
I need to signal this up.
00:24:42.299 --> 00:24:42.420
Yeah.
00:24:42.960 --> 00:24:43.059
Yeah.
00:24:43.440 --> 00:24:44.180
Tony, thank you very much.
00:24:44.380 --> 00:24:44.880
Great conversation.
00:24:45.079 --> 00:24:46.900
It could have gone on for another hour, probably.
00:24:47.660 --> 00:24:48.619
But thank you for your time.
00:24:48.779 --> 00:24:49.059
Thank you.
00:24:49.180 --> 00:24:51.680
the rich conversation. It was great being with you. Thanks very much. Thank you. Thanks.
00:24:54.059 --> 00:25:01.839
Thanks for listening to Toronto Talks, conversations with the leaders shaping the region's economy. Follow us wherever you get your podcasts.
