The federal government and the City of Toronto are assembling more than $2.7 billion in financing, capital funding, public land and municipal incentives to move 18 stalled rental housing projects into construction.

The projects will deliver more than 5,600 rental homes across Toronto. Construction on more than 4,500 units is expected to begin before the end of 2026, according to the federal announcement.

All 18 developments have been planned, permitted and approved but have been unable to secure the financing needed to break ground. The package is intended to close those viability gaps by combining federal loans and capital funding with city-owned sites, property tax exemptions and other municipal incentives.

The portfolio is divided evenly between nine developments on city-owned land and nine privately owned projects.

The federal government did not identify the developers or borrowers behind the nine privately owned projects. More than $1.8 billion of the package consists of repayable construction loans for those developments through Canada Mortgage and Housing Corporation’s Apartment Construction Loan Program.

The loans will support more than 3,700 rental homes, including more than 1,000 affordable units.

Build Canada Homes will provide more than $310 million to advance the nine city-owned sites, which will deliver nearly 1,900 rental homes. The total includes more than 700 affordable and supportive homes and more than 1,100 rent-controlled units delivered by non-market housing providers.

Toronto will contribute land to those projects at nominal value, along with more than $530 million in capital funding and financial incentives. The municipal support includes exemptions from city and school property taxes for periods of up to 99 years.

The approach reduces two of the largest costs in a rental development’s capital stack: acquiring the site and carrying property taxes over the life of the asset.

Among the developments moving forward is a project at 158 Borough Dr. in Scarborough, near the future Scarborough Centre subway station. It is planned to include housing for families, seniors and essential workers.

The Parkdale Hub is also included. The planned 16-storey development will combine rental housing with community and cultural space on city-owned land.

The agreement adds federal construction financing to Toronto’s growing use of public land, capital funding, fee relief and tax exemptions to make rental projects viable.

The funding is expected to be deployed over the next three years.

Pictured: 158 Borough Dr. in Scarborough is among the projects moving forward. The new development will include 687 housing units.

Credit: CreateTO