Should demovicting developers have to double new rentals? One Toronto councillor thinks so

Toronto's city staff will explore if the city can make developers double the number of rental units in a new development after knocking down an apartment building.

In 2022, amid what Coun. Dianne Saxe called an "epidemic" of applications to demolish affordable purpose-built rentals, Toronto approved more than 20 apartment buildings for demolition to make way for new apartments or condos.

Now, Saxe wants the city to capitalize on the so-called demovictions — a demolition-driven eviction — by potentially mandating that developers rebuild with twice as many apartments for rent. 

Saxe put a motion before council this week asking city staff to examine how the city can require developers to add more purpose-built rentals to their new developments.

"We have the right to set conditions relating to rental supply and we have a desperate shortage of rental supply, so we should be doing more," said Saxe, who represents University-Rosedale.

"If we're going to be losing these existing buildings, we should at least be getting more rental back." 

Saxe's motion passed with an amendment on Thursday. Hers wasn't the only motion council voted through in an effort to fight Toronto's housing crisis, motions to establish a renters action committee and increase to the vacant housing tax were also passed this week.

Since 2017, 81 apartment buildings have been approved for demolition and replacement, according to the city's online data portal — a number accounting for nearly 5,000 rentals. Eleven were approved in 2020, eight more in 2021, and then 23 more in 2022. 

Currently, if a developer proposes to demolish six or more rentals, the city requires them to rebuild the same number of rentals and offer similar rents for at least a decade. Saxe is asking city staff to see if Toronto can mandate developers double the amount in new developments.

The data portal shows three approvals so far in 2023, and Saxe is hoping the city can get more housing out of demoviction requests still to come.

Renters facing demoviction need help now, tenant says

That city council will "finally" be looking at demovictions as a driver of the affordability crisis is encouraging, said Megan Kee, an organizer with the advocacy group No Demovictions.

Still, she says the motion doesn't go far enough.

"We welcome solutions, but it doesn't do anything to actually address the concerns of the tenants that are being displaced," said Kee, who is facing her own potential demoviction in the Mount Pleasant West neighbourhood. 

One issue she has with the existing tenant protections are the rent gap payments meant to help tenants pay for a new unit after being demovicted. 

While the city says it indexes the data upwards to reflect changes in the market, another advocate with No Demovictions told CBC Toronto before a protest earlier this month that those payments are calculated using data that is lower than similar aggregates. 

After Saxe's motion was introduced to city council, it was amended by Coun. Chris Moise to touch on the rent gap issue. The motion will now also instruct staff to examine the feasibility of including secondary market data in rent gap payment calculations. The Canada Mortgage and Housing Corporation says secondary market rentals include things like houses, condos and duplexs, among other things. 

The group isn't against development, Kee says — it just wants to see development done responsibly. 

"We want to make sure vulnerable tenants maintain their housing, [that] they're not displaced in the middle of a housing affordability crisis and that we are building additional affordable housing," she said.

Saxe says she recognizes the disruption being demovicted creates in people's lives. She also pointed to the city's existing tenant protections like rent gap payments and the right to return to the new building at the same rent. 

Proposal could be risky but worth exploring: Saxe

Saxe's idea is bold, according to Geordie Dent, executive director of the Federation of Metro Tenants Association. 

He says he's not aware of any other Canadian city implementing such a measure, though it is in line with the recommendations of a provincial task force, which called for increased urban density last year.

"I don't know how they're going to achieve this, just because it's not something I've actually seen before," Dent told CBC Toronto.

Saxe acknowledged there's no legal precedent for such a mandate and that city staff may investigate and find the idea is risky. However, she believes it could be done and that now is the time to do it — in part because the federal plan to remove GST from rental developments makes it more cost competitive.

"We have, at least arguably, authority to require more rental units," she said.