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Bricks & Sticks

by Desi Auciello

Desi Auciello is the 2006 GTHBA President, and is also president of Cachet Estate Homes.

Land conference highlights growth challenges

Date: June 16, 2006

If you were trying to reach your home builder or anybody even remotely associated with the home building industry this past Tuesday June 12, don't take it personally if you didn't hear back from them.

As it turns out, the vast majority of the key players in the industry -- more than 500 in total -- were jammed into the Metro Toronto Convention Centre for The Land Conference, sponsored in part by the Greater Toronto Home Builders' Association and the Urban Development Institute/Ontario.

Billed as an opportunity to hear informative speakers discuss each major asset class, stay apprised of the very latest trends in each of Canada's leading real estate markets, and make personal contacts with key local and national decision makers, the conference, which was presented by York Communications, more than lived up to its billing.

The conference proved particularly interesting from a timing standpoint, coming just prior to the release by the provincial government of the Greater Golden Horseshoe Growth Plan on June 15th.

It will be interesting to compare the final details of the growth plan against the insights of the stellar cast of speakers at the Land Conference. Let's look at what they had to say.

Land availability

Speaking on a panel addressing the key pressures and major issues on the availability of land in the Greater Golden Horseshoe, Tom McCormack, executive director of the Centre for Spatial Economics, said the province has got it right with the population, employment and household projections in the growth plan. However, he asserts that the province is way off target with the projection for the single detached home market share. Whereas the plan envisions 600,000 single detached homes over the next 30 years, he foresees a demand for 900,000 singles.

McCormack says this 300,000 unit difference is very important in terms of fulfilling the quality of life aspirations of the highly-skilled, well-educated immigrants we will need to attract to fulfill our employment needs. If we can't house them, they won't bother coming, or will go elsewhere, he said.

Mark Tutton, senior vice president of land development for Tribute Communities and chair of the Urban Development Institute commented that the province's greenbelt represents a "strangulation" of the natural growth of the GTA, adding that the only way it will succeed is if the intensification policies in the growth plan work. If they don't work, we're looking at higher housing prices, Tutton said.

Land values

In a subsequent session on land values and development opportunities in the 905 area of the GTA, Leith Moore, vice president of development, for the Sorbara Group, posed questions to a panel of developers and senior municipal government representatives.
Asked what single issue was having the most significant impact on land values, Gary Gregoris, vice president, land for Halton Division, Mattamy Homes, cited a whole shopping list of potential culprits but ultimately fingered the length of time it takes to get development approvals as the biggest factor.

Janet Babcock, commissioner of planning and development for the town of Richmond Hill agreed with Gregoris adding her own twist on the failure of the provincial government to approve and invest in infrastructure. The bombshell she dropped on the conference was that due to infrastructure constraints, there would likely be no building permits issued in Richmond Hill for five years starting next year. Considering our members sold more than 2,500 units there last year, this is a major supply gap.
John Waller, director, long range and strategic planning for the regional municipality of York, concurred with Babcock, citing infrastructure and environmental approvals.

Moore went on to probe the panel on their views on the short and long-term supply of development land. Gregoris described the short-term land supply as "bleak" while Babcock said it was "abysmal." Waller pointed out that 69 per cent of the land in York region is protected by either the Oak Ridges Moraine or the greenbelt.

When the conversation shifted to the details of the pending growth plan, the focus shifted to intensification, as the growth plan calls for 40 per cent of annual development to be within the existing built up area. Babcock declared that there isn't one person who lives in a neighbourhood in Richmond Hill that likes lots smaller than 40 feet or apartments taller than 3 storeys.
Waller said that the implication of the 40 per cent rule is that a Markham equivalent, in terms of the number of units, will have to be built within the existing built up areas of the region on a go forward basis. "As of right development" is the only way to overcome resident objections to intensification, Waller said.

Caplan's challenge

All eyes will be on Public Infrastructure Renewal Minister David Caplan when he unveils his growth plan this Friday. The extent to which the plan clearly responds to the issues identified by the panelists, e.g., land supply, built form, development approvals, infrastructure, etc., will determine the success or failure of the plan.

We'll let you know how the minister does, and what it means for you, once we have had an opportunity to review the final plan in detail. Stay tuned.