Toronto City Council has approved a plan to defer development charges on up to 3,000 new condominium units in an effort to boost housing supply.

The program will provide developers with a four-year tax deferral. Citing city staff findings, Toronto Today reported that the program could save developers $19,000 in costs per unit.

The publication also reported that development charges currently range from $52,000 to $80,000 per condo or apartment unit.

The initiative aims to support developers by delaying upfront costs, with the goal of accelerating construction and increasing the availability of multi-residential units. Developers will be required to pay the development fees without interest.

In accordance with council’s approval, the city will ask the federal government to release Toronto’s remaining $235.6 million in Housing Accelerator Fund allocations to cover the deferral costs.

Officials expect the measure to encourage developers to proceed with planned projects despite current economic challenges.

The deferral program is part of Toronto’s broader strategy to address housing affordability and supply issues.

The Building Industry and Land Development Association, which represents the region’s developers, welcomed the deferral program.

“We appreciate the city’s efforts to address the slowdown in housing supply and recognition of the importance of multi-residential ownership housing in resolving this issue,” wrote Danielle Binder, head of policy and advocacy for BILD, in a letter to Mayor Olivia Chow and the city’s executive committee.

But BILD is calling for “more comprehensive measures” to fully address Toronto’s housing crisis and support a broader range of stalled projects.

A broader exemption from development charges for all condominium and purpose-built rental units, supported by provincial and federal funding, would encourage developers to move projects forward and help meet the demand for both affordable and market-based housing,” Binder wrote.

Pictured: Condominium project under construction in downtown Toronto near the CN Tower.

Photo: Bazis