master innovation & development plan · 2019-07-29 · consequently, and as detailed further...

ABSTRACT

The purpose of this study is to provide a third-party evaluation of the unique economic impacts associated with the current development concept envisioned and proposed by Sidewalk Labs for redeveloping underutilized land in Quayside and other sections of Toronto’s eastern waterfront.

Most relevant sections: Vol 1 (Quayside Plan, River District Concept Plan, Economic Development )

TITLE: Sidewalk Toronto Economic Impact Analysis

AUTHOR: urbanMetrics Inc.

Master Innovation & Development PlanTechnical Appendix

© 2019 Sidewalk Labs. The content, documents and materials contained herein are considered Sidewalk Proprietary Information.

SIDEWALK TORONTO Economic Impact Analysis Toronto, Ontario

Prepared for Sidewalk Labs

June 12, 2019

This document is available in alternative formats upon request by contacting:

www.urbanMetrics.ca | 67 Yonge Street, Suite 804, Toronto, ON, M5E 1J8 | 416-351-8585 (1-800-505-8755) | [email protected]

http://www.urbanmetrics.ca/

mailto:[email protected]

www.urbanMetrics.ca | 67 Yonge Street, Suite 804, Toronto, ON, M5E 1J8 | 416-351-8585 (1-800-505-8755) | [email protected]

Preface

Among other key data inputs, this economic impact analysis relies on development

concepts and proposal information provided by Sidewalk Labs, which are to be

included in the DRAFT Master Innovation and Development Plan (MIDP) being

submitted to Waterfront Toronto. All of these concepts and proposals were developed

in consultation with a variety of stakeholders and are subject to approval by many of

those same stakeholders, including but not limited to public entities and Sidewalk Labs.

Consequently, and as detailed further herein, the real estate development programs outlined in this

report are preliminary and conceptual only. They are intended for reference and illustrative purposes,

providing a general indication as to the possible extent of new development throughout Toronto’s

Eastern Waterfront. They do not necessarily represent the actual extent nor type of development that

could ultimately be advanced by the current or potential future owners of these lands.

It is also important to note at the outset of this report that the main development scenarios identified

in our study consider a variety of financial investments that will ultimately be borne by both public

and private sector organizations. As such, Sidewalk Labs would be just one of many such entities

contributing to the total investment numbers estimated in this report. While the actual delivery of

some of this new building and infrastructure spending is yet to be determined in terms of specific

funding/financing options and the parties responsible for each investment component, our economic

impact analysis does not necessarily distinguish between the original source of spending. Rather, it

considers the total roll-up impacts of initial one-time and recurring “shock” investments, regardless of

the specific organizations involved (e.g., government agencies, property owners, other private

business interests, etc.).

http://www.urbanmetrics.ca/

mailto:[email protected]

Contents Executive Summary

1.0 Introduction .......................................................................................................................... 1

1.1 Background ................................................................................................................................. 2

1.2 Purpose ....................................................................................................................................... 5

1.3 Objectives ................................................................................................................................... 5

1.4 Approach .................................................................................................................................... 6

2.0 Baseline Scenario ................................................................................................................ 20

2.1 Development Program ............................................................................................................. 21

2.2 Assumptions ............................................................................................................................. 24

2.3 One Time Impacts (Construction) ............................................................................................ 26

2.4 Recurring Impacts (Occupancy) ............................................................................................... 32

3.0 Sidewalk Labs Scenario ....................................................................................................... 38

3.1 Development Program ............................................................................................................. 39

3.2 Assumptions ............................................................................................................................. 43

3.3 One Time Impacts (Construction) ............................................................................................ 44

3.4 Recurring Impacts (Occupancy) ............................................................................................... 50

3.5 Other Benefits .......................................................................................................................... 55

4.0 Differentiating Factors ........................................................................................................ 57

4.1 Urban Innovation Cluster / Google Canadian HQ .................................................................... 58

4.2 Tall Timber ................................................................................................................................ 65

4.3 Flexibility in Design / Radical Mixed Use .................................................................................. 69

5.0 Tourism Impacts ................................................................................................................. 72

5.1 Toronto Tourism Context ......................................................................................................... 73

5.2 Assumptions ............................................................................................................................. 77

5.3 Visitor Spending Estimates ....................................................................................................... 80

5.4 Visitor Spending Impacts .......................................................................................................... 83

Appendix A Economic Impact Approach ................................................................................... 85

Appendix B Economic Impact Summary Tables ......................................................................... 91

Appendix C urbanMetrics Profile ............................................................................................ 105

Figures Figure 1-1: Existing Conditions in Eastern Waterfront ............................................................................. 2

Figure 1-2: Potential Future Conditions in Eastern Waterfront ............................................................... 4

Figure 1-3: Map of Eastern Waterfront .................................................................................................... 7

Figure 1-4: Map of Phase 1 and Phase 2 Lands ........................................................................................ 8

Figure 1-5: Map of Sub-Districts in Eastern Waterfront ........................................................................... 9

Figure 2-1: Summary of Key Statistics – Development Program (Baseline Scenario) ............................ 22

Figure 2-2: Economic Impact Summary – Building Construction (Baseline Scenario) ............................ 28

Figure 2-3: Economic Impact Summary – Infrastructure (Baseline Scenario) ........................................ 30

Figure 2-4: One-Time Municipal Revenues Summary (Baseline Scenario) ............................................. 31

Figure 2-5: Permanent On-Site Employment (Baseline Scenario) .......................................................... 32

Figure 2-6: Assumed Employment Composition by Industry (Baseline Scenario) ................................. 33

Figure 2-7: Economic Impact Summary – Annual Operating Output (Baseline Scenario) ..................... 35

Figure 2-8: Recurring (Annual) Property Tax Revenues (Baseline Scenario) .......................................... 37

Figure 2-9: Cumulative Property Tax Revenues, 2025 – 2050 (Baseline Scenario) ................................ 37

Figure 3-1: Summary of Key Statistics – Development Program (SWL Vision) ....................................... 41

Figure 3-2: Economic Impact Summary – Building Construction (SWL Vision) ...................................... 46

Figure 3-3: Economic Impact Summary – Infrastructure (SWL Vision)................................................... 48

Figure 3-4: One-Time Municipal Revenues Summary (SWL Vision) ....................................................... 49

Figure 3-5: Permanent On-Site Employment (SWL Vision) .................................................................... 50

Figure 3-6: Assumed Employment Composition by Industry (SWL Vision) ............................................ 51

Figure 3-7: Economic Impact Summary – Annual Operating Output (SWL Vision) ................................ 53

Figure 3-8: Recurring (Annual) Property Tax Revenues (SWL Vision) .................................................... 54

Figure 3-9: Cumulative Property Tax Revenues, 2025-2050 (SWL Vision) ............................................. 55

Figure 4-1: Population Change, 2011-2016 ............................................................................................ 59

Figure 4-2: Percent of Foreign-Born Population ..................................................................................... 59

Figure 4-3: Tech Labour Concentration .................................................................................................. 60

Figure 4-4: Crane Counts in North America ............................................................................................ 61

Figure 4-5: Smart City Benefits ............................................................................................................... 63

Figure 4-6: Forestry Direct Employment, 2007-2017 ............................................................................. 65

Figure 4-7: Location of King-Spadina/King-Parliament ........................................................................... 69

Figure 5-1: Map of Key Tourist Destinations Along Toronto’s Waterfront ............................................ 75

Figure 5-2: Primary Purpose of Tourist Visits to RTO 5 .......................................................................... 76

Figure 5-3: Visitors to RTO 5 by Length of Stay ...................................................................................... 76

Figure 5-4: Average Daily Expenditures by Visitation Type .................................................................... 77

Figure 5-5: Visitation and Spending Forecasts for Eastern Waterfront .................................................. 81

Figure 5-6: Tourism Visitation to Selected Attractions Across North America ...................................... 82

Figure 5-7: Economic Impact Summary – Eastern Waterfront Tourism Spending ................................. 84

Figure B-1: Economic Impact Summary – Baseline Building Construction (Total) ................................. 92

Figure B-2: Economic Impact Summary – Baseline Infrastructure (Phase 1) ......................................... 93

Figure B-3: Economic Impact Summary – Baseline Construction (2040) ............................................... 94

Figure B-4: Economic Impact Summary – Baseline Infrastructure (Phase 1 + Phase 2) ......................... 95

Figure B-5: Economic Impact Summary – Baseline Infrastructure (2040) .............................................. 96

Figure B-6: Economic Impact Summary – Baseline Operating Output (Phase 1 + Phase 2) .................. 97

Figure B-7: Economic Impact Summary – Baseline Operating Output (2040) ....................................... 98

Figure B-8: Economic Impact Summary – SWL Vision Building Construction (Phase 1 + Phase 2) ........ 99

Figure B-9: Economic Impact Summary – SWL Vision Building Construction (Phase 1) ...................... 100

Figure B-10: Economic Impact Summary – SWL Vision Infrastructure (Phase 1 + Phase 2) ................ 101

Figure B-11: Economic Impact Summary – SWL Vision Operating Output (Phase 1 + Phase 2) .......... 102

Figure B-12: Economic Impact Summary – SWL Vision Tourism (Same-Day Expenditures) ................ 103

Figure B-13: Economic Impact Summary – SWL Vision Tourism (Overnight Expenditures) ................ 104

CREDITS

Selected graphics in this report sourced from www.flaticon.com, including icons made by:

• Freepik

• Picnic and Barbecue

• Infographic Elements

• SimpleIcon

• Kiranshastry

Sidewalk Toronto – Economic Impact Analysis (Toronto, Ontario) | i

This economic impact analysis relies on development concepts and proposal information provided by Sidewalk Labs,

where applicable. All of these concepts and proposals were developed in consultation with a variety of stakeholders and

are subject to approval by many of those same stakeholders, including but not limited to public entities and Sidewalk Labs.

Executive Summary

ii | Sidewalk Toronto – Economic Impact Analysis (Toronto, Ontario)




Mandate The primary purpose of this study has been to evaluate the unique economic impacts

associated with Sidewalk Labs’ ambitious and technology-focused development vision

for Quayside and the broader Eastern Waterfront.

urbanMetrics has been retained by Sidewalk Labs to review and evaluate the impacts of redeveloping

underutilized land on Toronto’s Eastern Waterfront. Sidewalk Labs has asked for an independent,

third-party assessment of an innovative new city-building approach that has the potential for

extraordinary economic impact, improved sustainability and enhanced urban quality of life. This

report evaluates the current development concept envisioned and proposed by Sidewalk Labs. The

details contained herein are subject to change based on ongoing and substantive public consultation,

discussions and ultimately additional approvals prior to any new development.

This study has been prepared as a means to help measure the one-time and recurring benefits

associated with advancing development on Toronto’s Eastern Waterfront, including ambitions that

deliver best-in-class, integrated technologies (the Sidewalk Labs Vision) versus a more incremental

approach to development that would evolve over time based on prevailing land-use policies and the

development patterns that currently define Toronto (the Baseline/Status Quo). It is important to note

that the Sidewalk Labs proposal represents the total range of development potential currently

envisioned for the Eastern Waterfront, and may ultimately be refined based on collaborative

outcomes with industry stakeholders and the public at large.

Approach urbanMetrics has modelled the economic impacts of a variety of one-time and recurring investments

relating to the ultimate build-out of the Eastern Waterfront. This has included detailed assessments of

the capital building construction investment associated with both the proposed Sidewalk Toronto and

Baseline scenarios, as well as accompanying spending relating to advanced infrastructure delivery.

Relying on similar methodologies, we have also tested the annual impacts of ongoing operational and

tourism activities in the area upon full build-out of the subject lands.

PART I

Context

Sidewalk Toronto – Economic Impact Analysis (Toronto, Ontario) | iii




Our report also draws attention to the potential influence of a variety of key innovations proposed by

Sidewalk Labs (“SWL”), including an expanded infrastructure commitment, the establishment of an

Urban Innovation Cluster, the wide-spread adoption of tall-timber construction, as well as inherent

design principles that would support increased modularity and flexibility in the use of buildings.

Study Areas Our study has evaluated economic impacts across several pre-defined geographies within Toronto’s

Eastern Waterfront. These geographies have generally been consolidated into two distinct phases.

iv | Sidewalk Toronto – Economic Impact Analysis (Toronto, Ontario)




Development Scenarios For the purposes of this study, two distinct development scenarios have been

established that each articulate the potential and likely full build-out of the Phase 1 and

2 lands under differing visions.

urbanMetrics has worked both independently and in direct cooperation with SWL to establish the

specific underlying assumptions and factors that have subsequently been considered as part of the

nature and basic composition of investments relating to the two development scenarios identified.

Scenario 1: Policy-Driven Baseline

This “status quo” scenario is based primarily on the existing planning policy regime and zoning

permissions in the Eastern Waterfront, as established by Waterfront Toronto and the three

levels of government. The development assumptions for this scenario have been informed

by a variety of supporting documents, including the Port Lands Planning Framework and more detailed development forecasts prepared by

Waterfront Toronto.

Role: Waterfront Toronto continues to act as the coordinating agency for federal, provincial and local interests on Toronto’s waterfront. Under

Scenario 1, Waterfront Toronto plays a leadership role in delivering incremental investments by

private and public landowners across the entire Toronto waterfront.

Scenario 2: Sidewalk Labs Vision

SWL has outlined a range of ambitious, technologically-driven innovations that constitute

a core differentiation from traditional forms of residential and non-residential development. In

addition to differing degrees of intensification and a unique subset of land uses proposed, SWL has integrated several innovative and one-of-a-kind

elements to their proposed development scheme that represent a material departure from the

traditional development process.

Role: Sidewalk Toronto represents a collaborative partnership between Sidewalk Labs and Waterfront Toronto working towards a

comprehensive, long-term vision for a new urban precinct along Toronto’s Eastern Waterfront.

Sidewalk Toronto – Economic Impact Analysis (Toronto, Ontario) | v




Development Vision Sidewalk Labs’ vision for the Eastern Waterfront involves an environmentally

sustainable, high-density, technology-driven community. This community will offer a

variety of housing options, flexibility in use-types, as well as space for fledgling startups

and larger established organizations alike. It is imagined to incorporate innovative,

technology-based solutions to contemporary urban challenges.

The Sidewalk Toronto proposal envisions a unique development of the majority of the

Eastern Waterfront that involves increased provisions for new residential and

commercial spaces to be delivered over a significantly expedited timeline1.

1 SWL has independently developed a vision for the Phase 1 and Phase 2 lands. urbanMetrics has provided some input into

underlying assumptions to inform the proposed concept and related development yields.

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Phase 1

Phase 1 + 2

Baseline Scenario2

Residents: Employees: Housing Units: Gross Floor Area (SF): Completion Date: Construction Value3:

4,800 1,400 2,800 3.1M 2025 $1.5B

30,500 17,000 18,000 24.3M 2050

$12.1B

Sidewalk Labs Vision

Residents: Employees: Housing Units: Gross Floor Area (SF): Completion Date: Construction Value4:

4,500 3,900 2,800 2.6M 2026 $1.6B

53,000 44,000 35,000 32.8M 2040

$17.9B

2 Baseline scenario development program informed primarily by a review of available policy documents and other relevant information, including the Port Lands Planning Framework, discussions with Waterfront Toronto staff, a review of municipal plans and as-of-right development permissions, as well as active development application information and recent Ontario Municipal Board rulings. 3 Excludes capital investments related to infrastructure.

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Key Impacts

Baseline (Phase 1 + 2)

$12.1B Capital Investment


$5.0B Annual Output

91,500 Construction Jobs (FTE)

22,500 Construction Jobs

18,000 Direct Jobs

SWL Vision (Phase 1 + 2)



$13.2B Annual Output



46,500 Direct Jobs

These capital investments represent all public and privately-led development initiatives throughout the Phase 1 and 2

lands. All job estimates represent Full-Time Equivalents (FTEs). “Direct Jobs” include work-from-home employment.

PART II

Highlights

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Key Takeaways The scale and scope of investment contemplated in the design and delivery of new

buildings, public spaces and community infrastructure on Toronto’s Eastern Waterfront

would represent one of Canada’s most ambitious development projects, ever.

At a total project value of some $23.1B, the full build-out of the project—including infrastructure—

over a 20-year time frame would put Toronto in the international spotlight for decades to come. This

cost represents the totality of the estimated investment required to realize the proposal and would

be borne by various public and private stakeholders, including Sidewalk Labs, its project partners,

lenders, and a variety of unrelated third parties.

Return on Investment

Through Waterfront Toronto, government partners are currently in the process of completing an advanced flood-protection system that will safeguard existing and future neighbourhoods adjacent to the Don River. To date, an estimated $1.25B on nearby flood-protection measures has been committed. The realization of $17.9B in new building construction along the Eastern Waterfront alone—including on lands directly adjacent to the mouth of the Don River— would represent an enormous return on investment, amounting to almost 15 times the initial public investment.

Acceleration of Development

Notwithstanding the aforementioned investment throughout the Eastern Waterfront—and the associated one-time and recurring impacts to the local economy—the Sidewalk Labs vision would also allow for a notable acceleration to developing one of the most underutilized real estate assets in Toronto. In particular, it would represent a major catalyst to development, ultimately advancing the delivery of critical new infrastructure, an expanded LRT network and housing, along with a range of other associated economic benefits over a much shorter development horizon. The Sidewalk Toronto vision represents an opportunity to accelerate full build-out of the Phase 1 and 2 lands more than a decade sooner than the baseline scenario. Acceleration would yield some $1.6B in annual property tax revenue by 2040, compared to only $0.5B realized under the Baseline, as well as delivery of the preliminary phases of a new LRT line significantly earlier than under the baseline scenario.

Urban Innovation, Talent, & Global Leadership

Cities around the world are currently engaged in a race for innovation, talent and leadership. As geo-political conditions continue to shift, Toronto has emerged as a global destination for research and investment in emerging technologies related to healthcare, communications, environmental services, transportation, as well as increasingly in artificial intelligence and machine learning. Over the past 5 years, the number of jobs in Toronto’s

Sidewalk Toronto – Economic Impact Analysis (Toronto, Ontario) | ix




tech sector has increased by more than 50%. In the last year alone, nearly 30,000 tech jobs were added to the Toronto labour market. As an open and welcoming City, Toronto is ready to capitalize on its growing reputation for urban innovation, green infrastructure and advanced building sciences. The Sidewalk Labs vision would provide an ecosystem that enables software developers, civil engineers and civic institutions to play a pivotal role in shaping emergent technologies that will enable safer, cleaner and more equitable cities going forward. As an anchor to achieving this vision for Toronto, Google has proposed relocating their Canadian Headquarters to the Eastern Waterfront.

Exponential Benefits of Tall Timber

The Sidewalk Labs proposal for Toronto’s Eastern Waterfront envisions a more sustainable future that leverages the natural beauty and structural integrity of wood-based construction. The Sidewalk Labs vision will harness wood products and domestic building innovations that support sustainable forestry practices in communities across Canada. The delivery of wood buildings on Toronto’s waterfront represents one of the most ambitious tall timber projects in the world, and would help developers across North America—and globally—push the envelope for larger, greener, more sustainable building solutions. Canadian producers are expertly positioned to take the reins of a new product segment that is poised for 20 to 30 percent year-over-year growth. The Sidewalk Toronto project could contribute significantly to growth in this industry sector, ultimately requiring the annual production of some 50,000 to 55,000 cubic metres of Cross-Laminated Timber (“CLT”) product to support the full buildout of the concept. This volume of production would be consistent with the annual output of approximately 1.0 – 1.5 average-output CLT factories operating at full capacity. As proposed, the domestic supply of CLT wood products to Toronto’s Eastern Waterfront would support an estimated 2,500-person years of full-time employment, including jobs in manufacturing, sawmills, forests and transportation over a 20-year period.

Continuity

The Sidewalk vision provides Toronto with an opportunity to maintain its status as an international leader for livability and innovation, and at the same time pivot to a new reality where more and more Torontonians want to live and work in the core. The vision provides a robust and immediate response to mounting problems in Toronto, especially housing affordability and escalating congestion. It also provides flexibility to ensure that film, media and other communication companies will continue to define Toronto’s diverse economic base. The construction and reimagination of vast areas of Central Toronto—such as King-Spadina and King-Parliament, for example—have paved the way for a modern city to flourish with new economic life. The Sidewalk vision builds on these successes and ensures that the delivery of housing, workplaces, parks and civic institutions can take root quickly and build upon key infrastructure improvements that are already planned or underway.

x | Sidewalk Toronto – Economic Impact Analysis (Toronto, Ontario)




Scale of Investment The total value of the capital investment program associated with the full build-out of

the proposal is estimated at some $17.9 Billion. This represents almost a 50% increase

over the building construction related investment than anticipated under the Baseline

scenario.

In addition to the key economic and financial benefits derived from this significant one-time and

ongoing investment in the waterfront, the SWL vision would also yield a more immediate injection of

critical new market and non-market housing, as well as key infrastructure.

At full build-out, the SWL proposal would help to deliver a substantial new supply of

housing units able to support a total population of some 53,000 residents.

This magnitude of housing delivery represents more than 1.7 times the residential population and

approximately 2.0 times the number of units anticipated under the Baseline development scenario.

PART III

Details

Sidewalk Toronto – Economic Impact Analysis (Toronto, Ontario) | xi




As proposed, the full build-out of the Eastern Waterfront would also establish a variety

of new spaces for existing and potential net growth in local business, ultimately

accomodating an estimated 44,000 permanent on-site jobs.

The vast majority of this local employment base would be focused on high-output office-based

business activities, with a particular focus on urban innovation-related industries. By comparison, the

full build-out of the same area under the Baseline scenario would yield an estimated 17,000

permanent jobs, excluding work from home positions.

Impacts of Investment

Building Construction

The one-time impacts of capital investment in new building construction throughout

the Eastern Waterfront would generate significantly more value to the local economies

of Toronto, Ontario and Canada under the Sidewalk Labs proposal.

Based on the results of our economic impact analysis, the full build-out of the Eastern Waterfront

under the SWL vision could yield some 135,900 jobs (full-time person-years of employment) and

$17.6 Billion in value added to the Canadian economy, including over $12.8 Billion to the Toronto

economy.

xii | Sidewalk Toronto – Economic Impact Analysis (Toronto, Ontario)




This represents an almost 1.5 times increase in total value added to the Canadian economy, as well

as an equivalent increase in construction/development related employment relative to the Baseline

scenario.

Sidewalk Toronto – Economic Impact Analysis (Toronto, Ontario) | xiii




The full realization of the Sidewalk Labs proposal for the Eastern Waterfront would

yield almost double the one-time municipal revenues to the City of Toronto.

Based on a combination of both one-time development charges and other planning application

related fees, the full build-out of the SWL vision for the entire Eastern Waterfront would yield some

$970 Million in one-time revenues by the year 2040 under the SWL build program, versus

approximately half of that total ($535 Million) being generated under the Baseline scenario for the

entire Eastern Waterfront.

Infrastructure

Above and beyond the aforementioned capital investment in building construction,

additional spending on the establishment of new infrastructure—including the

proposed extension of the LRT throughout the Eastern Waterfront—would also yield

significant one-time value to the economy.

xiv | Sidewalk Toronto – Economic Impact Analysis (Toronto, Ontario)




Operational Benefits The realization of the SWL vision would provide opportunities to accrue a range of

significant and recurring economic benefits relating to the various new business

activities that will occupy space throughout the Eastern Waterfront.

Employment Composition

With a proposal to relocate the Google Canadian Headquarters as part of establishing a broader

Urban innovation Cluster in the Eastern Waterfront, underlying local employment would

undoubtedly shift in favour of higher value-added jobs, further supplementing the significant local

service, commercial retail and administrative employment that currently operates in the area.

Specifically, we anticipate up to a 7-fold increase in employment across a number of selected

industry sectors that typically produce among the most significant GDP values per employee.

This injection of a new high output employment base will also help to further solidify Toronto’s

reputation as a major global centre for business and ultimately enhance its ability to compete for

talent on the world stage.

Estimates include additional “work from home” employment.

Sidewalk Toronto – Economic Impact Analysis (Toronto, Ontario) | xv




Annual Output

With a significant local employment base estimated at over 44,000 upon completion of development

throughout the Eastern Waterfront, an estimated $13.2 Billion in economic output (GDP) would be

generated by new businesses each year within the Eastern Waterfront, in 2019 dollars.

Similar to the proposed one-time capital investments in building construction and

infrastructure, this level of annual output is expected to generate a range of significant

spin-off benefits to the local economies of Toronto, Ontario and Canada.

xvi | Sidewalk Toronto – Economic Impact Analysis (Toronto, Ontario)




Acceleration of Development By introducing a range of new innovative techniques to development and technological

advances in building construction, the Sidewalk Labs vision allows for a significant

acceleration to traditional development timelines.

Property Tax Revenues

Among the most notable benefits of this accelerated timeline, the SWL development program would

allow for a more rapid accumulation of property tax revenues generated upon full delivery to market

and ultimate occupancy of various new real estate assets throughout the Eastern Waterfront. By

2040, for example, we estimate that more than triple the property tax revenues will have accrued to

the City of Toronto through development on the Phase 1 and 2 lands.

Sidewalk Toronto – Economic Impact Analysis (Toronto, Ontario) | xvii




Permanent Employment

Similar to the aforementioned benefits of cumulative property tax revenues accruing to

the City of Toronto, it is equally important to note that the absorption of new space in

commercial buildings constructed throughout the Eastern Waterfront would be

achieved over a significantly advanced planning horizon.

In particular, not only is the total permanent on-site employment estimated to be almost 3 times

greater upon full build-out of the Eastern Waterfront under the SWL vision, but the growth in jobs is

also expected to be realized significantly earlier relative to the baseline scenario.

xviii | Sidewalk Toronto – Economic Impact Analysis (Toronto, Ontario)




Geographic Distribution of Benefits The size and scope of the SWL proposal provides economic benefits that will be felt

across the country for decades to come. The project would create employment—not

only in Toronto but nationally—and would provide significant economic lift and tax

revenue creation for governments across Canada.

One-Time Impacts

+

Ongoing Impacts

All economic impacts shown represent the full build-out of Phase 1 and Phase 2 of the Sidewalk Toronto project. Economic

impacts to be realized are not necessarily limited to the main geographies shown above (i.e., a portion are also expected

to accrue directly to a range of other municipal and provincial jurisdictions beyond Toronto and Ontario).

Sidewalk Toronto – Economic Impact Analysis (Toronto, Ontario) | xix




Differentiating Factors

Urban Innovation Cluster / Google Canadian HQ

The City of Toronto is revered the world over for its high quality of life and its competitive business climate. Toronto is widely regarded as one of the most desirable and most dynamic cities in the world. Canadians are proud of the strong leadership they provide on the international stage, and the City of Toronto is a mirror reflection of the global perspective that Canadians steadfastly maintain. Toronto and Sidewalk Labs share a common interest in developing smart, sustainable and socially inclusive cities and neighbourhoods. The Sidewalk Toronto vision represents an opportunity to jointly pursue and promote an innovation landscape that enables bold moves without compromising the importance of collaboration, good design and strong governance.

The Sidewalk Toronto project would galvanize Toronto’s brand position as a Top-10 global destination for investment, innovation and talent. A deeper focus on urban innovation, which broadly includes clean-tech, prop-tech and transportation tech, will draw students, researchers, innovators, entrepreneurs as well as seasoned business leaders to the Toronto market. Sidewalk Lab’s stated proposal to relocate Google Canada’s headquarters to Toronto’s Eastern Waterfront area provides a strong foundational anchor for other tech-companies to follow-suit. The Sidewalk proposal has the potential to position Toronto as the dominant go-to market for designing, testing and implementing urban innovation systems that support key sustainability targets, locally, domestically, and globally.

Tall Timber

Over the past 10-15 years, new technologies in wood manufacturing have enabled the development of taller, stronger and more efficient building structures that leverage both the aesthetic and ecological benefits of wood. In just a few short years, the number of tall-timber projects around the world has grown substantially and building heights are now beginning to soar to previously unimaginable heights.

Today, there are over 35 active tall timber projects on the books, including in Tokyo, London, Chicago, Philadelphia, Stockholm, Paris, Vienna and Amsterdam. These projects range in size from 20+ storeys in cultural capital such as Amsterdam and Vienna to super-tall structures comprising between 70 and 80

xx | Sidewalk Toronto – Economic Impact Analysis (Toronto, Ontario)




storeys in major metropolises like Chicago, London and Tokyo. No tall-timber project, however, is more ambitious in size, scope and complexity than that proposed for the Sidewalk Toronto project.

Building on Canada’s global position as a forestry and wood-product manufacturing powerhouse, Sidewalk Toronto would help Canada’s construction sector pivot to more environmentally sustainable—and more efficient—building practices that promise to set new international standards for green building design. The development of tall timber structures on Toronto’s Eastern Waterfront will support massive reductions in greenhouse gas emissions relative to conventional steel, concrete and structures. Moreover, the pursuit of tall timber construction will generate significant momentum for Canada’s forestry sector to invest and innovate in new plant capacity that will turn out stronger and more resilient building materials, in addition to generating new job opportunities. With this, Canada has the potential to stake out a global leadership position in an industry subsector that is projected to experience 20-30% year-over-year growth.

Flexibility in Design (“Radical Mixed Use”)

Twenty years ago, planners in the City of Toronto embarked on a bold policy move designed to reverse the fortunes of two languishing industrial districts flanking the downtown core. The Two Kings – focused on King-Spadina and King-Parliament respectively, represented a fresh way of thinking and helped unlock the potential of under-utilized real estate assets in downtown Toronto. Between 1998 and 2018, the two Kings regeneration policy area—comprising over 400-acres and dozens of city-blocks—set in motion a massive, yet highly organic urban revitalization effort that resulted in the construction of 50,000+ new housing units and 45,000+ new employment positions, all supported by transit. Building on Toronto’s growing interest in dense, urban neighbourhoods, SWL proposes a new district that incorporates the need for flexibility as a precursor for good planning and design. The notion of radical mixed use, which contemplates both horizontal and vertical integration of diverse urban activites, provides users with the ability to grow and adapt with their spaces rather than simply consume them for a limited, fixed period of time. The Sidewalk approach envisions an urban environment that is constantly evolving, without the need for excessive rebuilding and redesign every time something changes. This novel and highly innovative approach is being used to help advance a new template for living; one that fully embraces the benefits of greater urban efficiencies and stronger collaborative connections.

Sidewalk Toronto – Economic Impact Analysis (Toronto, Ontario) | xxi




Tourism Spending The SWL vision presents an opportunity to boost recent and ongoing efforts to improve

tourism activities throughout Toronto’s core, ultimately extending the “ribbon” of

existing attractions and establishing an eastern anchor to the waterfront.

The uniqueness of the new developments contemplated under the SWL vision for the Eastern

Waterfront, coupled with the existing and proposed investments by Waterfront Toronto throughout

the area promise to create a one-of-a-kind draw. Due to the scale of the redevelopment concept, it is

likely that the Eastern Waterfront would attract a variety of visitors, for commercial, leisure,

academic, and environmental purposes.

Waterfront Toronto’s investment in public infrastructure throughout the core of Toronto’s waterfront

has had a significant impact on overall tourism patterns. In addition to capturing tourists already

planning to visit Toronto in coming years, it is highly likely that SWL’s development efforts would

induce new trips to Toronto and ultimately encourage visitors to extend their stays. Based on our

research, we anticipate that some 7.4 million tourists could visit the Eastern Waterfront by 2035,

making this destination equivalent to other premier urban districts and destinations in comparable

North American cities.

xxii | Sidewalk Toronto – Economic Impact Analysis (Toronto, Ontario)




With significantly increased visitation to the Eastern Waterfront, a total of some $104

Million in tourism related spending could be expected annually in advance of the full

build-out of Phases 1 and 2 of the development.

Based on recent and forecast changes in tourism growth in Toronto, the City is poised to welcome an

increasing number of visitors to the evolving Waterfront. The ambitious Sidewalk Toronto vision in

particular could act as an additional and even stronger driver of visitation to the shores of Lake

Ontario.

Sidewalk Toronto – Economic Impact Analysis (Toronto, Ontario) | xxiii




The vision that Sidewalk Labs has outlined for the Eastern Waterfront represents a

significant city-building opportunity that furthers a range of public policy goals, induces

substantial economic benefits, and represents a significant expansion in scale versus

expected development under a status quo scenario.

The City of Toronto is facing a myriad of challenges as it emerges as a city of global influence.

Affordable housing, public transportation, and environmental sustainability have emerged as pressing

issues facing the City. In order to continue to attract global talent and retain a reputation as a

desirable, open and successful city, it is imperative that Toronto take meaningful steps to address

these challenges.

Sidewalk Labs’ vision for the Eastern Waterfront represents an innovative opportunity for the City of

Toronto to leverage a unique partnership that takes a significant step towards building a more

inclusive, more accessible and more equitable city. Furthermore, the vision proposes a range of

unique, forward-thinking innovations that would position Toronto to maintain a central presence in a

rapidly evolving technology-focused global economy.

The investment of some $23.1 Billion during the full build-out of the Eastern Waterfront—including

both building construction and infrastructure components—would represent a substantial financial

contribution that would have meaningful impacts reverberating through a variety of local industries,

providing a significant amount of associated employment, and generating substantial one-time and

ongoing tax revenue to various levels of government.

Additionally, the potential establishment of a domestic tall-timber manufacturing industry, the

creation of an Urban Innovation Cluster, and pioneering new flexible design principles represent only

a few of the opportunities to realize legacy benefits that would extend far beyond the shores of

Toronto’s Eastern Waterfront in years to come. The economic, social and environmental benefits

associated with the SWL vision presents a generational opportunity to position Toronto as an

innovative municipality on the leading edge of addressing many of the central challenges now facing

contemporary cities.

PART IV

Conclusion

Sidewalk Toronto – Economic Impact Analysis (Toronto, Ontario) | 1




1.0 Introduction

2 | Sidewalk Toronto – Economic Impact Analysis (Toronto, Ontario)




1.1 Background

Project Inception

In 2001, Waterfront Toronto was formed as part of a tripartite agreement between the City of

Toronto, Province of Ontario and Government of Canada. The corporation’s mandate has been to

develop and execute the revitalization of Toronto’s waterfront into a destination that is attractive to

residents, workers and visitors alike. To date, the undertaking has attracted billions of dollars in

private investment, helped to establish new communities and infrastructure, and redefined Toronto’s

waterfront as a premier destination within the City.

In March 2017, Waterfront Toronto released a Request for Proposals (“RFP”) for an “innovation

partner” to develop Quayside, a 12-acre (5 hectare) parcel of land located at the edge of the East

Bayfront that will serve as a key gateway to the adjoining Port Lands area. The intent of this RFP was

to develop Quayside as a testbed for innovative, technologically-driven design that could ultimately

be implemented across the entire Eastern Waterfront4 and beyond over a longer-term planning

horizon. At over 800 acres (325 hectares), this district represents one of the largest underdeveloped

tracts of urban land remaining in North America.

Figure 1-1: Existing Conditions in Eastern Waterfront

SOURCE: Pinewood Toronto Studios (L), Sidewalk Labs (R).

4 For the purposes of this study, the “Eastern Waterfront” district includes all of the lands commonly known as Quayside, the Keating Channel precinct (Keating West and Keating East), Villiers Island, as well as other portions of the broader Port Lands area. The exact delineation of this area and its various sub-districts have been further defined in Figure 1-3 of this report.

Looking West Looking East





Sidewalk Labs (“SWL”), a subsidiary of Alphabet Inc., was ultimately awarded the aforementioned

RFP released by Waterfront Toronto and has since been undertaking a significant, year-long

community engagement and planning program to inform their vision for the area. SWL’s vision is a

data-driven approach that incorporates innovative technology-based solutions to respond to

contemporary issues, including sustainability, affordability and accessibility. The Quayside site and

accompanying development concepts represent an opportunity for the City of Toronto to become a

global leader in technologically-driven urban living.

In support of their recent efforts in Toronto, SWL has engaged a variety of organizations, consulting

practices and non-governmental actors to inform the establishment of a Master Innovation and

Development Plan (“MIDP”) agreement with Waterfront Toronto, which is expected to be completed

in 2019. This document will reflect the culmination of SWL’s detailed research and stakeholder

engagement activities, ultimately serving as a guide for future development plans throughout the

Eastern Waterfront and beyond.

Sidewalk Toronto

As a direct outcome of the process outlined above, Sidewalk Toronto

(“SWTO”) represents a partnership between Sidewalk Labs and Waterfront

Toronto, working together to create a new mixed-use community on the

Toronto waterfront. This partnership will begin with Phase 1 (Quayside) and

could ultimately be scaled across the entire Eastern Waterfront. The main

objectives of this endeavour have been identified as follows:

• Establish a complete community that improves quality of life for a diverse population of

residents, workers, and visitors;

• Create a destination for people, companies, start-ups, and local organizations to advance

solutions to the challenges facing cities, such as energy use, housing affordability, and

transportation;

• Make Toronto the global hub of a rising new industry: urban innovation; and,

• Serve as a model for sustainable neighbourhoods throughout Toronto and cities around the

world.

A major component of Sidewalk Lab’s vision is to incorporate data-driven solutions, technology and

leading-edge planning and design practices into the community. The Sidewalk Toronto project is

looking at how these advances could specifically address central issues in Toronto, including: housing

affordability, transit accessibility and environmental sustainability, as well as investigate how such

improvements could be used to guide decisions that advance the overall well-being of local residents.





Figure 1-2: Potential Future Conditions in Eastern Waterfront

SOURCE: Sidewalk Labs.

Keating Channel

McCleary District Polson Quay

Port District Port District





1.2 Purpose To inform the myriad of options and opportunities available, as well as to provide an understanding of

the unique economic, social and cultural value of new innovations implemented in the area, SWL has

retained urbanMetrics inc. (“urbanMetrics”) to evaluate the economic impacts of their proposed

development initiatives in Toronto’s Eastern Waterfront area.

Serving as additional input to the preliminary development planning and research phase now being

undertaken by SWL, this Economic Impact Analysis provides a detailed assessment as to the potential

economic benefits generated through the initial capital investments proposed in Phase 1 (Quayside),

as well as elsewhere in the Eastern Waterfront. This study also considers a range of other related

economic impacts that could be derived from the ongoing business operations and tourism activities

expected within the new communities that would be established upon completion of the proposal.

This report evaluates the current development concept envisioned and proposed by Sidewalk Labs.

The details contained herein are subject to change based on ongoing and substantive public

consultation, discussions, and ultimately additional approvals prior to any new development.

Given the scale of development being contemplated across the Eastern Waterfront, as well as the

growth pressures currently facing the City of Toronto, SWL’s proposal represents a unique and

innovative opportunity that has the potential to utilize technology in ways that enhances quality of

life for Torontonians, and fundamentally influences the future of urban living across the globe.

Our work on this assignment has ultimately sought to quantify and provide additional third-party

commentary as to the specific economic benefits associated with Sidewalk Labs’ ambitious proposal

to provide first-to-market innovations and new ideas that will redefine urban living. It is important to

note that the Sidewalk Labs proposal represents the total range of development potential currently

envisioned for the Eastern Waterfront, and may be ultimately refined based on collaboration with

industry stakeholders and the public at large.

1.3 Objectives Based on the underlying purpose of this study, the following highlights a number of the more specific

objectives of the research program undertaken by urbanMetrics.

• To articulate a baseline development scenario that reflects the anticipated scale and nature

of investment that would be pursued by traditional land developers in Toronto, absent the

involvement of Sidewalk Labs;





• To understand how SWTO’s proposed innovations and development concept could differ

from a more policy-driven approach to development that is likely to prevail under a “status

quo” scenario;

• To determine the one-time construction impacts associated with a number of pre-identified

development scenarios, including comparisons between each outcome;

• To evaluate a more comprehensive range of recurring operational impacts associated with

the future employment base expected under each scenario;

• To provide an understanding of the key qualitative and broader spin-off economic impacts

associated with the various scenarios tested, including a more detailed evaluation of some of

the key differentiating factors unique to the vision established for Sidewalk Toronto; and,

• To offer insight into the potential tourism benefits associated with the development of a

unique new technologically-driven neighbourhood in Toronto.

1.4 Approach The following provides a brief introduction to the basic structure of our analysis, the specific types of

quantitative and qualitative economic impacts that have been considered, the geographic extent of

our research, as well as a number of the key underlying assumptions and parameters that establish a

foundation for the more detailed research findings presented herein.

Key Geographies

While the recent and ongoing revitalization efforts undertaken by Waterfront Toronto encompass the

full extent of the Toronto waterfront—extending between Mimico and Port Union in the west and

east, respectively—this particular study has focused exclusively on an area that urbanMetrics has

defined as the “Eastern Waterfront”, as illustrated in Figure 1-3 below.

This represents the main geographic area of focus for SWL, beginning with the 12-acre (5 hectare)

Quayside parcel situated at the north-west corner of the Eastern Waterfront and potentially

extending further south and east over a longer-term, phased planning horizon. It encompasses a

significant portion of the broader Port Lands area.





Figure 1-3: Map of Eastern Waterfront

SOURCE: urbanMetrics inc. Image is for reference purposes only.

As part of the more detailed economic impact reporting included throughout this report, it has also

been important to present our findings at different levels of geography and spatial scales. To this end,

we have adopted a number of smaller sub-geographies within the Eastern Waterfront, which

generally correspond with many of the pre-existing planning efforts undertaken by Waterfront

Toronto and the City of Toronto. It is important to note, however, that these districts do vary slightly

from those delineated within the Port Lands Planning Framework. The geographies shown above have

additionally been utilized by Sidewalk Labs, and grouped into distinct phases. For the purposes of this

report, the phasing and geographical distinctions outlined herein have been held constant throughout

our analysis.

As outlined below and per the maps in Figure 1-4 and Figure 1-5, the Eastern Waterfront area is

generally comprised by the lands defined herein as Quayside, Keating West, Keating East, Villiers





Island, Polson Quay, and McCleary District. These are the various sub-districts and smallest levels of

geography considered in this study.

Based on the development concepts and definitions available from SWL, the Eastern Waterfront has

also been further sub-divided into three distinct phases, as follows: Phase 1 includes Quayside and

Phase 2 includes Keating West, Keating East, Villiers Island, Polson Quay and McCleary District.

It is important to note at the outset of this study that—based on the definitions above—the entire

Eastern Waterfront area represents our main area of focus. While any new development efforts in

this area are generally expected to begin with Phase 1—with or without SWL—the broader Phase 1

and Phase 2 lands represent the required scale at which the various technological and infrastructural

investments proposed for the Eastern Waterfront can be reasonably achieved. For example, planned

investments in LRT infrastructure would not be warranted with the development of Phase 1 alone,

nor could the associated economic benefits be solely attributed to this relatively small level of

geography.

Figure 1-4: Map of Phase 1 and Phase 2 Lands






Figure 1-5: Map of Sub-Districts in Eastern Waterfront






Development Scenarios

urbanMetrics has worked in direct cooperation with SWL to establish a number of distinct

development scenarios that articulate the potential and likely full build-out of the Eastern Waterfront.

The specific underlying assumptions and factors considered as part of each of these development

scenarios have been determined based on urbanMetrics’ extensive experience in urban development

projects across the Greater Toronto Area and beyond, including in particular our work along Toronto’s

waterfront, as well as per direct input from SWL relating to their own vision for the lands.

The scenarios tested in this study are outlined in more detail below.

Scenario 1: Policy-Driven Baseline To establish a reasonable baseline and general point of reference for our analysis, we have quantified the economic benefits of a “status quo” scenario associated with development of the Eastern Waterfront under the current planning policy context5. It assumes that all development in this area will occur in the complete absence of SWL. This scenario is based primarily on the existing planning policy regime and zoning permissions in the Eastern Waterfront, as established by Waterfront Toronto and the three levels of government. The development assumptions for this scenario have been informed by a variety of supporting documents, including the Port Lands Planning Framework and more detailed development forecasts prepared by Waterfront Toronto.6

5 Recognizing the rapid rate of change and current trends relating to densities and scales of development within Toronto—particularly within the Downtown area—we have also undertaken a related but distinct assessment of a more “market-driven” baseline development scenario. This alternative scenario generally considered more significant development densities at select locations than those outlined through existing policy, which may provide for a more realistic assessment of the potential future build-out of this area (i.e., even in the absence of SWL moving forward). For simplicity, however, we have not reported directly on the results of this analysis in this particular document. 6 Documents referenced include: The Port Lands Planning Framework, decisions rendered by the Ontario Municipal Board on various proximate lands, as-of-right zoning designations, in addition to detailed development forecasts prepared by Waterfront Toronto and relied upon by urbanMetrics as part of previous economic impact studies.





Scenario 2: Sidewalk Labs Vision SWL has outlined a range of ambitious, technologically-driven innovations that constitute a core differentiation from traditional forms of residential and non-residential development. As such, we have undertaken an equivalent analysis to that prepared for Scenario 1, but relating to a more ambitious type of development for the Eastern Waterfront, as envisioned by SWL7. In addition to differing degrees of intensification and a unique subset of land uses proposed, SWL has integrated several innovative and one-of-a-kind elements to their development scheme that represent a material departure from the traditional development process. Some of the key elements that define this departure—which have all been described in more detail herein—include:

The establishment of an Urban Innovation Cluster and corresponding proposal to relocate Google’s Canadian Headquarters to the Eastern Waterfront;

A widespread reliance on Mass-Timber based construction methods and materials; and,

A commitment to greater flexibility in design and

“radical mixed-use” development, allowing for a more dynamic occupation of buildings.

While most of the economic impacts associated with these two scenarios have been reported

separately in the following sections of this report, one of the main outcomes of this study has been to

determine the relative benefit to all three levels of government and the surrounding community in

this part of Toronto. As such, the summary sections of this report provide a more in-depth

consideration of the “head-to-head” comparisons for a number of selected variables and key metrics.

7 The SWL development concepts—including associated use types, densities and project costing—have been determined completely independent from urbanMetrics. The detailed statistical inputs required for this study have been provided by SWL with the sole purpose of quantifying the economic value of realizing their vision for the subject lands.





Quantitative Impacts

The majority of the key economic impacts identified throughout this report have been calculated

through the use of an econometric model that simulates the flow of expenditures throughout the

economy. The underlying principle of this type of model is that each dollar of expenditure on goods

and/or services purchased from a given industry sector circulates and re-circulates within the

economy, thereby multiplying the impact of the initial expenditure. This concept is referred to as the

multiplier effect, and has three main components: direct impacts, indirect impacts and induced

impacts.

The custom-built model utilized by urbanMetrics is based on input-output tables produced by

Statistics Canada and is designed to provide a reliable measure of the impact of a given initial or

“shock” investment on employment generation, labour incomes, value added to the economy, as well

as government revenues. These types of impacts have generally been expressed at the National,

Provincial and local (i.e. City of Toronto) levels.

This report primarily assesses the potential incremental benefits associated with Sidewalk Labs’

technologically-driven plan for the Eastern Waterfront and has sought to articulate the key

differences of the SWL vision relative to more traditional approaches to real estate development.

Beyond the basic changes in density and use-type breakdown inherent to each of the development

concepts considered, the unique nature of Sidewalk Labs’ vision for these lands have also been

reflected in the key inputs and overall structure of our analysis, wherever possible.

For example, in order to capture the full extent of the unique impacts derived from each of the two

development scenarios identified, we have tested a range of different types of capital investments

and ongoing operational activities. The following provides a brief introduction to the specific types of

investments and business activities that have been tested using the input-output model noted above.

The full build-out of the Eastern Waterfront will involve substantial one-time capital investments to construct the various new buildings and real estate assets in this area. These investments are expected to span residential, retail/service commercial, office, industrial/production, institutional, and a range of other unique uses. The identified land uses, development densities and building materials used in the new buildings will have a significant influence on the magnitude and nature of the total expenditures made. Developing an understanding as to how the SWL vision differs from more traditional development formats has been an important aspect of this component of our analysis.

See Appendix A for a more detailed overview of our economic impact approach.





Similar to the construction of the actual buildings and new spaces being integrated within this area, the full build-out of the Eastern Waterfront will require extensive capital investments relating to infrastructure. Some of the basic underlying elements that will be common to both development scenarios—at least in part—include: sitework, stormwater management, public realm improvements, roads, bridges, and transit. In addition, the SWL vision will involve the introduction of a range of more unique and one-of-a-kind infrastructure components that underscore the technology-driven focus of their endeavour.

In addition to the scale of development considered under each scenario—which will have a direct influence on the total number of jobs that can be accommodated in the Eastern Waterfront—the vision proposed by SWL will have a fundamental impact on the nature of local business activities. For example, a proposal to relocate Google’s Canadian Headquarters to the Eastern Waterfront and establishing a corresponding Urban Innovation Cluster collectively represent a significant divergence from the types of traditional mixed-use development likely to prevail at this location in the absence of SWL. This will alter the core composition of the resulting employment base in this area, as well as the corresponding level and type of output from local businesses.

Recognizing SWL’s innovative approach to neighbourhood building and radical departure from traditional development concepts, the new communities developed under the SWL vision will undoubtedly attract significant tourism interest from across the globe. We anticipate that this heightened interest in Toronto and the Eastern Waterfront will emerge from students, academics, urbanists, in addition to more casual members of the general public; all of which may embark on dedicated trips to encounter the area and/or increase their dwell time as part of existing travel plans. Overall, the SWL concept would induce additional visitation to Toronto, thereby increasing tourism-related expenditures in the local economy.

In addition to the main economic impacts determined through the foregoing analysis, we have also

considered a range of other one-time and recurring economic benefits that are not captured by this





type of input-output modelling. The following identifies a number of the additional metrics that have

been considered in this study, including for both of the main development scenarios.

• On-Site Employment Growth (Permanent)

Whereas our analyses of the initial capital investments and recurring business operations

associated with each development scenario have determined the total employment supported

by these particular economic activities, we have also undertaken a more focused assessment

as to the total on-site employment that could be accommodated within the new communities

established in the Eastern Waterfront. That is, rather than the more widespread employment

impacts resulting from the specific “shock” investments identified earlier (e.g., building

construction, infrastructure, operating output, tourism spending, etc.), we have estimated the

number of permanent jobs that will be accommodated in the area upon full build-out. These

jobs will collectively represent the future employment base in the Eastern Waterfront.

• Municipal Fees (One-Time)

In addition to the aggregated government revenues calculated as a function of the initial and

ongoing economic spending identified above—which are expected to accrue to all three levels

of government and in jurisdictions across Canada—the full build-out of the Eastern Waterfront

will incur a range of more specific charges and fees that are unique to the City of Toronto. In

particular, we have estimated the total development charge revenues and other one-time

planning application fees that will result from new development in this area.

• Property Taxes (Recurring)

Similarly, the various new and improved real estate assets established throughout the Eastern

Waterfront can ultimately be expected to generate significant revenue for the City of Toronto

by way of increased property tax revenues. Based on a combination of current municipal

property tax rates and our own estimates of the potential future assessment value of

properties located throughout the Eastern Waterfront, we have determined the total property

tax revenues that could be generated by each of the identified geographies, as well as over

various time horizons based on project phasing.

Qualitative Impacts

Finally, beyond the quantifiable economic impacts outlined above, the project team has also

identified a variety of additional benefits associated with the proposed development and full build-

out of the Eastern Waterfront, as envisioned by SWL. These benefits have been informed by the

underlying development concept established by SWL, as well as additional supplementary research

completed by urbanMetrics into the nature and resulting impact of the unique innovations proposed

by the organization.





Some of the wide-ranging economic and social outcomes that may be realized as a result of the SWL

vision include improved quality of life, increased sustainability outcomes, enhanced infrastructure

investment, expedited development timelines, affordable housing provision, positive contribution to

the overall profile of Toronto as a global city, among other benefits identified herein.

As identified earlier in this report, we have also undertaken a more in-depth evaluation of a number

of more selected differentiating factors likely to emerge from the SWL vision, which are expected to

have a more notable impact on the local economy. The key differentiating factors considered in this

portion of our analysis include:

Urban Innovation Cluster / Google Canadian HQ As part of their proposed investment in the Eastern Waterfront, SWL has committed to several actions and initiatives that will support the development of a broader Urban Innovation Cluster. This investment program envisions a hub for non-governmental organizations, research institutions, post-secondary institutions and private tech-firms working in a collaborative and experimental environment, with a particular focus on technology driven initiatives that impact urban places and produce tangible improvements to quality of life. As an anchor to this node, SWL has proposed relocating and expanding Google’s Canadian Headquarters to a new facility on the Eastern Waterfront. In addition, SWL has will dedicate space to support institutions that will catalyze and attract a broader cluster of technology-centric organizations and businesses. Notwithstanding the range of other urban innovations proposed, this initiative alone presents an opportunity to cement the Eastern Waterfront as an innovative new district that could become an industry leader in advancing city-based technologies. Once established, it would help Toronto continue to compete for talent and attract new businesses from across the world, representing a significant departure from the traditional composition of employment seen across most areas of Toronto at present. As envisioned, this area would position Toronto as the global leader in technologically driven urban innovations, using the Eastern Waterfront as a lived demonstration of the potential benefits and opportunities.





Tall Timber SWL has committed to a widespread adoption of tall timber-based construction methods, wherever possible throughout all of the developments undertaken in the Eastern Waterfront. This initiative marks a significant departure from more traditional steel and concrete forms of development, which continue to dominate the construction landscape across North America. Despite the significant environmental, cost and building efficiency benefits of timber-based construction, it has not yet been utilized on such a large scale to date; particularly in the Toronto context. The SWL proposal provides an opportunity for Toronto to become a global leader in the manufacturing, design and implementation of wood-frame based mid- and high-rise building construction.

Flexibility in Design (“Radical Mixed Use”) SWL has proposed an approach to development in the Eastern Waterfront that allows for extreme flexibility in the evolving use and occupation of buildings, particularly in terms of their overall design and ultimate tenanting. For example, SWL is introducing new building types – known as “loft” and “stoa” spaces – which have high ceilings and flexible floorplates to accommodate changing uses over time. As demand for space changes through inevitable market cycles and technological advances, the SWL vision establishes an unparalleled degree of flexibility to avoid lengthy and expensive reconstruction projects and time delays in repositioning assets for various uses. This type of modularity also delivers significant benefit to individual businesses that could occupy space in these building, reflecting their own expansion and growth patterns over time.





Assumptions

There are a number of underlying and basic assumptions upon which the validity of the findings

presented in this report depend. Based on our considerable and long-term experience in the urban

planning and real estate development process, we recognize and appreciate the problems associated

with making generalized assumptions about future conditions. Undoubtedly, deviations from

historical and current trends will occur in the future, however, basic simplifying assumptions are

required regarding the possible extent of such deviations.

The following provides a brief summary as to a number of the key underlying assumptions for this

particular economic impact analysis. Additional assumptions relating to the individual development

concepts tested (i.e., Scenarios 1 and 2) have also been included in Sections 2.0 and 3.0 of this report,

respectively.

• During the forecast period discussed in this report, a reasonable degree of economic stability

will prevail in the Province of Ontario, and specifically in the context of the City of

Toronto/Greater Toronto Area market.

• The various statistical inputs relied upon in our analyses—based largely on municipal

information, CoStar Realty Information Inc. and other available real estate market data

sources—are considered sufficiently accurate for the purposes of this analysis. These statistical

sources have ultimately informed a number of the key underlying assumptions and inputs

utilized in our analysis, including those relating to building efficiencies, vacancy rates, average

unit sizes, employment densities, parking ratios, hard and soft building costs, property

assessment values, property tax rates and other municipal fees, employment compositions by

industry and other relevant factors.

• The real estate development programs outlined herein are preliminary and very high-level

concepts only. They are intended for reference and illustrative purposes, providing a general

indication as to the possible extent of new development throughout the Eastern Waterfront.

They do not necessarily represent the actual extent nor type of development that could

ultimately be advanced by the current or future owners of the subject lands. As outlined in

more detail herein, these concepts have been based on information obtained directly from

both Waterfront Toronto and SWL.

• The two main development scenarios identified in this study consider a variety of investments

that will ultimately be borne by both public and private sector organizations. While the

actual delivery of some of this new building and infrastructure spending is yet to be

determined in terms of specific funding/financing options and the parties responsible for each

investment component, our economic impact analysis does not necessarily distinguish

between the original source of spending. Rather, it considers the total roll-up impacts of initial





“shock” investments, regardless of the individual organizations involved (e.g., government

agencies, property owners, other private business interests, etc.).

• Given the scale of development contemplated across the Eastern Waterfront—and the

corresponding amount of construction and other related employment required as input to

realizing these concepts—both the Scenario 1 and Scenario 2 plans could inherently contribute

to and/or exacerbate local shortages in a range of construction trades. Given that such a

significant development plan will undoubtedly be phased in over time, however, it has

generally been assumed that construction activity in the Eastern Waterfront will not, in and of

itself, cause any meaningful supply and demand imbalances in the local economies of Toronto

or the broader Greater Toronto area. As such, we have not made any adjustments in our

analysis to account for these risks.

• The analyses presented in this report assumes that the significant amount of new

development forecast for the Eastern Waterfront would not be possible without the initial

investment in planning and infrastructure by both Waterfront Toronto and SWL. Although it is

possible that a portion of this future development activity could locate elsewhere in the

City/Region in the absence of such investments, we note that the Eastern Waterfront

represents a particularly unique opportunity in terms of its proximity to the City’s downtown

core, access to new waterfront and other community amenities, as well as with respect to the

magnitude of land available for redevelopment at a single location. As such, it is our opinion

that a significant portion of the benefits associated with the development planned for this

area can be directly attributed to the investments and construction spending identified in this

study. In the absence of these types of investments, any opportunities for a similar level of

development in other parts of the City would likely be limited by comparison.

• References to the Canadian dollar in this report, dealing with present and future periods,

reflect its 2019 value. We recognize that fluctuation in the absolute value of the dollar will

likely occur during the period covered by this report. We assume, however, that the

relationship between the various metrics identified (e.g., current real estate/assessment

value, construction costs, etc.) and the value of the dollar will remain more or less constant

during the period analyzed. As such, no adjustments for inflation have been included in our

analysis.

• Similar to above, given the preliminary and conceptual nature of the development scenarios

considered in this study—as well as the level of statistical detail available at this early stage of

the planning process—our economic impact analyses do not necessarily take into account the

time value of money, nor have we applied a corresponding discount rate, as is typical in more

traditional development pro forma financial analyses. In the case of an economic impact

analysis, such as those presented in this report, the resulting financial benefits are a direct

result of an initial “shock” expenditure or investment. The multiplier effect of this initial





spending will not change simply because the scale of an investment is reduced or increased,

provided the proportion spent within each industry category generally remains the same.

If, for any reason, major changes occur which could influence the basic assumptions stated above, the

recommendations contained in this report should be reviewed in light of such changed conditions and

revised, if necessary.





2.0 Baseline Scenario





2.1 Development Program The baseline development scenario considered in this study assumes a full build out of the Eastern

Waterfront, based on existing policy initiatives and plans. It assumes a complete absence of SWL in

the future development of this area and has been informed primarily by a review of available policy

documents and other relevant information, including the Port Lands Planning Framework, discussions

with Waterfront Toronto staff, a review of municipal plans and as-of-right development permissions

(i.e., per current Official Plan and Zoning By-law definitions), as well as a review of active

development applications and recent Ontario Municipal Board (“OMB”) rulings. Where necessary,

urbanMetrics has also supplemented this review with estimates as to the potential scale of

development at selected sites, based on our own professional judgement and local precedents.

The following highlights some of the key findings from this exercise in terms of the scale of

development contemplated across the Eastern Waterfront, including for each of the key geographies

identified earlier in Section 1.4 of this report. An explanation of the more specific underlying

assumptions that have contributed to the derivation of these figures has been provided herein.





Figure 2-1: Summary of Key Statistics – Development Program (Baseline Scenario)

Quayside Population: Employment: Number of Units: Gross Floor Area: Completion Date: Construction Cost:

4,800 Residents 1,400 Employees 2,800 Units 3.1 Million (sq ft) 2025 $1.5 Billion

Total Phase 1

Population: Employment: Number of Units: Gross Floor Area: Completion Date: Construction Cost:


Keating West Population: Employment: Number of Units: Gross Floor Area: Completion Date: Construction Cost:


Keating East Population: Employment: Number of Units: Gross Floor Area: Completion Date: Construction Cost:


Villiers Island Population: Employment: Number of Units: Gross Floor Area: Completion Date: Construction Cost:






Polson Quay Population: Employment: Number of Units: Gross Floor Area: Completion Date: Construction Cost:

- 5,000 Employees - 3.3 Million (sq ft) 2045 $1.7 Billion

McCleary District Population: Employment: Number of Units: Gross Floor Area: Completion Date: Construction Cost:

9,000 3,500 Employees 5,500 Units 6.3 Million (sq ft) 2050 $3.1 Billion

Total Phase 2* Population: Employment: Number of Units: Gross Floor Area: Completion Date: Construction Cost:


Grand Total (Total Phase 1 + 2)


30,300 17,000 Employees 17,800 24.3 Million (sq ft) 2050 $12.1 Billion

SOURCE: urbanMetrics inc., based primarily on development concept information obtained from Waterfront Toronto and other input assumptions developed by urbanMetrics. NOTE: Gross Floor Area figures include existing space identified to be maintained. Total construction costing shown is

comprised of both hard and soft costs. Numbers may not add up due to rounding.

*Phase 1 includes: Quayside; Phase 2 includes: Keating West, Keating East, Villiers Island, Polson Quay & McCleary District.

Grand Total (Eastern Waterfront) includes Phase 1 and 2 lands.





2.2 Assumptions In order to arrive at a full build-out concept for the Eastern Waterfront, as well as subsequent cost

estimates, square footage allocations, job and resident yields and fiscal benefits, urbanMetrics has

incorporated a range of assumptions. For the purposes of this document, the following key

assumptions are highlighted.

• Build-Out Program – Baseline development figures (i.e. total floor area estimates and detailed

allocations by land use) have been determined based on development forecasts obtained

directly from Waterfront Toronto as part of urbanMetrics’ previous project experience in this

area. Where necessary, we have also reviewed active planning applications and development

permissions for selected sites, based on available information from the City of Toronto.

• Net New Space – With the exception of a few selected industrial sites and heritage

properties—which are expected to retain the majority of their existing space, either in their

current condition or as part of a significant renovation—the Baseline development program

generally assumes a complete redevelopment of most of the sites in the Eastern Waterfront

(i.e., complete demolition and net new development upon full build-out). We note, however,

that we have only considered the costs of “net new” and/or significantly renovated buildings

as input to our assessment of building construction impacts, which we believe is a particularly

conservative approach.

Similarly, estimates of existing space have been determined based on information provided by

Waterfront Toronto.

• Planned and Approved Public Investments – The identified geographies and related

assumptions regarding possible phasing, as well as developable land areas, are predicated on

the continuation and ultimate completion of several significant public investments (including

both ongoing and approved spending). For example, approved changes to the Gardiner

Expressway re-alignment and Don River flood protection initiatives—as well as their

subsequent and material impact on opportunities for new development—are assumed to be

completed per current plans. Furthermore, it has been assumed that no significant deviations

from the existing planning framework and general intent of development on the subject lands

will occur in the coming years.

• Other Development Assumptions – Relying on the underlying floor area estimates noted

above, urbanMetrics has further applied a number of assumptions relating to building

efficiencies (i.e., net leasable/saleable areas), gross construction areas, vacancy rates, housing

type and tenure, average residential unit sizes, property assessment values and other relevant

metrics to arrive at the specific input formats required for this type of economic impact





analysis. These assumptions have been developed based primarily on precedents in the

surrounding market area, as well as broader averages for the City of Toronto.

• Population & Employment – Population and employment yields for all geographies have been

determined using average person per unit (PPU) and employment density (floor space per

worker) estimates for each major land use category.

• Building Construction Costs – Hard building construction costs for the Baseline Scenario

development program have been estimated by urbanMetrics based on the underlying build-

out figures provided, as well as appropriate construction cost ratios for the type and location

of development under consideration. Additional soft costs have also been considered as part

of a fixed percentage of the total capital investment required.

• Municipal Rates – Parking allocations, property tax revenues, development charges and

planning fees have all been determined based on current City of Toronto rates and ratios for

2018.

• Employment Composition – Relying on our estimates of the number of jobs that could be

accommodated upon full build-out of the Baseline development program, we have further

allocated the total employment throughout the Eastern Waterfront to a range of pre-defined

industry categories. This allocation was estimated by urbanMetrics, based on available Census

and Toronto Employment Survey data to determine the current composition of similar

employment areas throughout the municipality.

• Development Timing – The overall development phasing and potential timing of market entry

for each development block identified have been estimated by urbanMetrics, based on the

nature and scale of construction contemplated. These estimates are generally consistent with

the overall development timing now being considered by Waterfront Toronto and other local

property owners in the area. These estimates also reflect the likely timing of new

infrastructure delivery—including both funded and unfunded projects—which will represent

one of the main determinants of how quickly this area can ultimately build-out in the coming

years (e.g., floor protection, transit infrastructure, etc.).





2.3 One Time Impacts (Construction)


Based on the results of our economic impact analysis, the full build-out of Phases 1 and 2 of the

Eastern Waterfront—as determined through the baseline or “policy-driven” development parameters

outlined in Section 2.1—would generate significant economic value across Toronto, Ontario and

Canada. As detailed herein, a significant portion of the resulting revenues and employment impacts

would be realized directly within the City of Toronto, providing immediate benefit to the host

municipality, as well as spread more broadly throughout the local GTA economy.

The total value of construction of the development plan has been estimated at some $12.1 Billion

under the conditions of the Baseline development scenario. This includes two main spending

components, as follows:

• Hard Construction Costs – The cost of building construction, estimated using average cost per

square foot factors for the Toronto market and other comparable projects in the area; and,

• Soft Costs – Includes professional fees, marketing charges and contingency fees, as well as all

municipal charges (e.g., development charges, planning application fees, etc.)8.

Based on these estimates, the one-time construction expenditures associated with the build-out of

Phases 1 and 2 of the Baseline vision– including direct, indirect and induced impact components—will

generate a total of:

• ±$11.9 Billion in value added to the Canadian economy ($8.8 Billion in Toronto);

• ±91,500 full-time person years of employment (70,000 in Toronto)9,10;

• ±$7.4 Billion in labour income ($5.8 Billion in Toronto); and,

8 Building construction costs do not include developer profits (i.e., gross operating surplus). While this is essential to most traditional real estate development financial analyses, it is not required for this type of economic impact modelling. 9 These employment figures represent the full-time, full-year jobs generated by the intial direct capital investment in

buiding construction, as well as the indirect and induced impacts that are spread more broadly throughout the regional,

provincial and national economies. For the types of expenditures analyzed in this portion of our study, the employment

figures represent total years of full-time employment (e.g., one job identified represent the equivalent to one person

working full-time for the duration of one year). 10 Employment impacts and related multipliers have been adjusted (i.e., deflated) to reflect more accurate annual income statistics available for the City of Toronto and Province of Ontario.





• ±$4.8 Billion in revenues to the three levels of government, in the form of personal tax,

corporate tax, and other taxes11 (with approximately $1.1 Billion available at the municipal

level in Toronto).

The infographic in Figure 2-2 provides a similar overview and illustration as to the unique economic

impacts resulting from the baseline building construction across the Eastern Waterfront, whereas a

more detailed overview of the associated direct, indirect and induced impact components, as well as

a breakdown for each jurisdiction (i.e., Toronto, Ontario and Canada) has been provided in Appendix

B at the end of this report.

It is also important to note that—while we have included a range of more detailed reporting by

smaller geographies (e.g., at the district or development block level within the broader Eastern

Waterfront), the economic impacts referenced in this section represent the total National outputs.

With respect to building construction, the economic impacts attributable to each sub-geography are

generally commensurate with the overall level of development contemplated at each of these

locations, as outlined in Figure 2-1.

11 Other taxes include: Federal Trading Profits, Federal Gas Tax, Federal Excise Tax, Federal Duty Tax, Federal

Environmental Tax, Federal Air Transportation Tax, Federal Sales Tax, Import Duties, Federal Taxes on Production,

Provincial Environment Tax, Provincial Gallon Tax, Provincial Trading Profits, Provincial Gas Tax, Provincial Amusement Tax,

Other Provincial Consumption Taxes, Provincial Sales Tax, Provincial harmonized Sales Tax, Provincial Taxes on Production,

Municipal Amusement Tax, Municipal Sales Tax and Municipal Taxes on Production.

See Appendix B for a more detailed economic impact summary tables.





Figure 2-2: Economic Impact Summary – Building Construction (Baseline Scenario)

SOURCE: urbanMetrics inc. Includes development throughout entire Eastern Waterfront.





Infrastructure

In addition to the economic benefits associated with the construction of various buildings throughout

the Eastern Waterfront—including all residential, retail/service commercial, office and

institutional/community uses contemplated—a significant initial capital outlay will be required to

provide the underlying infrastructure necessary to adequately service these new communities.

Recognizing the current state and general lack of higher order infrastructure throughout this

predominantly industrial area, the scale of investment required to prepare the subject lands for the

intensified, mixed-use development envisioned will be significant.

Under the Baseline scenario, the level of infrastructure provided is assumed to be consistent with

current standards across the City of Toronto. For example, it has generally been assumed that the

development of new roadway infrastructure will not be constructed to different metrics or degrees of

quality than any other existing and comparable roadways in Toronto.

Based on estimates provided by SWL as part of their own internal infrastructure costing, the basic and

common underlying infrastructure investment required to realize the Baseline development scenario

is $3.0 Billion. This upfront and one-time capital investment in infrastructure includes expenditures

relating to sitework, civil infrastructure, public realm improvements, bridges, stormwater

management, road management, as well as the anticipated extension of Light Rail Transit (LRT)

service along Queens Quay East, among other relevant spending.

Similar to the findings presented in the previous subsection for building construction impacts, the

following outlines the key economic impacts associated with this level of infrastructure spending

under the Baseline scenario.





Figure 2-3: Economic Impact Summary – Infrastructure (Baseline Scenario)






Municipal Fees

In addition to the more significant one-time and nation-wide benefits identified in the previous

subsections of this report, the full build-out of the Eastern Waterfront would also generate significant

one-time revenues to the City of Toronto in the form of development charges and associated planning

application fees. As shown in Figure 2-4, the full build out of the policy-driven development concept

would yield approximately $535 Million in one-time municipal revenues, based on 2018 rates12 and

be realized at various stages over the entirety of the build program to 2060. Phase 1 alone would

account for some $80 Million—or approximately 14.9%—of this total.

Figure 2-4: One-Time Municipal Revenues Summary (Baseline Scenario)

SOURCE: urbanMetrics inc., based on City of Toronto 2018 Planning Fees.

12 Includes development charges, Official Plan amendment and Zoning By-law amendment fees. Estimate does not include Plan of Subdivision, Plan of Condominium, nor any other one-time municipal fees. Fee estimate is subject to change based on the ultimate development concepts advanced to the municipality, as well as the unit composition and overall mix of uses proposed.





2.4 Recurring Impacts (Occupancy)


Figure 2-5 further identifies the potential permanent on-site employment that could be

accommodated within the various newly constructed and/or renovated existing buildings throughout

the Eastern Waterfront under the Baseline development scenario. These employment estimates are

derived from the total build-out concepts identified for the subject lands, as well as average

employment density factors applied to each of the major land uses categories identified.

As shown, the full buildout of the concept could ultimately accommodate a total of some 17,000

permanent jobs upon completion, with the majority concentrated in office type buildings.

Figure 2-5: Permanent On-Site Employment (Baseline Scenario)

SOURCE: urbanMetrics inc. Work at home employment calculated separately from permanent on-site jobs.

Based on the employment estimates for the status quo development scenario shown above and as

input to our analysis of the ongoing operating output of the future employment base in this area, we

have estimated the likely employment composition of the broader Eastern Waterfront by industry

sector. This assumed allocation of employment has been informed by both the baseline development

program identified and the types of buildings proposed, as well as the current composition of

employment within various other employment nodes across the City of Toronto13. Using this

background research, urbanMetrics has developed the following employment composition and

resulting job estimates by industry.

13 Nodes considered include: Financial District, Downtown Toronto, King-Parliament Secondary Plan, King-Spadina Secondary Plan, Liberty Village, Port Lands and the Health Sciences District. Data for the entire City of Toronto were also considered.





Figure 2-6: Assumed Employment Composition by Industry (Baseline Scenario)

SOURCE: urbanMetrics inc.

Estimates shown includes additional “work from home” employment.

As shown, a significant portion of the potential future employment base in this area has assumed to

be represented within the Information and Cultural Industries; Professional, Scientific and Technical

Services; and a range of other service-based sectors, which is consistent with the focus on

employment within office, production/flex and other commercial type buildings.





Operating Output

Relying on available Statistics Canada data, the total employment estimates identified for the Baseline

scenario (Figure 2-5) and the above employment composition assumptions (Figure 2-6), we have

determined the total operating output of the future employment base as part of the overall build-out

of the Eastern Waterfront. In particular, the total employment within each industry sector identified

has been multiplied by relevant GDP output per worker factors to estimate the total operating output

of this base upon full build-out of the area. Estimated at some $5.0 Billion, this figure has been used

as the main input for this portion of our economic impact analysis and represents the recurring

(annual) operating activities of the future businesses within the area.

Similar to the earlier graphics detailing the impacts of new building and infrastructure construction,

Figure 2-7 provides a summary as to the total economic impacts derived from the annual operating

activities in the Eastern Waterfront under the baseline scenario.





Figure 2-7: Economic Impact Summary – Annual Operating Output (Baseline Scenario)







Property tax revenues and assessed values have been calculated for all properties throughout the

Eastern Waterfront, based on the assumed phasing and proposed nature of the new buildings in this

area. Future assessment values have been estimated based on assessed value per square foot

averages for other comparable properties along the Toronto waterfront and in other nearby

neighbourhoods. Subsequently, annual property tax estimates have been developed based on an

application of current 2018 municipal tax rates for each asset class.

Figure 2-8 summarizes the total property tax revenues that can be expected to be generated by new

development within each of the key geographies identified in the Eastern Waterfront, upon full build-

out. In Phases 1 and 2, these recurring benefits amount to a total of some $111.6 Million on an

annual basis, to be realized at the ultimate build-out of these phases in 2050.

Similarly, Figure 2-9 provides an illustration as to how these municipal revenues could ultimately grow

over the full planning horizon for the Eastern Waterfront on a cumulative basis. As shown, during the

period between 2025 and 2050, new development within the subject lands will have generated a total

of some $1.2 Billion.





Figure 2-8: Recurring (Annual) Property Tax Revenues (Baseline Scenario)

SOURCE: urbanMetrics inc., based on City of Toronto property tax rates and estimates of future assessment values for full

build-out program of the Eastern Waterfront. Estimates relate to new buildings only, as well as some selected buildings

which are expected to remain throughout the redevelopment process, per the baseline scenario assumptions.

Figure 2-9: Cumulative Property Tax Revenues, 2025 – 2050 (Baseline Scenario)

SOURCE: urbanMetrics inc., based on City of Toronto property tax rates and estimates of future assessment values for full

build-out program of the Eastern Waterfront. Estimates relate to new buildings only, as well as some selected buildings

which are expected to remain throughout the redevelopment process, per the baseline scenario assumptions.





3.0 Sidewalk Labs Scenario





3.1 Development Program The Scenario 2 development program has been established exclusively by the SWL development team

in collaboration with their other relevant project consultants and based on input from external

stakeholders. Various background information and underlying assumptions relating to the Baseline

development scenario considered in this study have been made available for reference to SWL,

however urbanMetrics was not involved directly in the creation of the SWL development program,

nor the corresponding cost estimates and residential/employment yields. Where applicable,

urbanMetrics has relied on SWL to provide required statistical inputs and assumptions that reflect

their overall vision for the Eastern Waterfront and the unique set of land uses identified (e.g., “stoa”

and “loft” spaces, etc.). Therefore, urbanMetrics’ role has been to provide an independent analysis as

to the unique economic impacts that could ultimately be generated through the realization of the

vision articulated by SWL.

SWL’s vision for the Eastern Waterfront represents a significant departure from that envisioned in the

Baseline scenario outlined in Section 2.0. Based on the information provided by SWL, the following

summarizes a number of the key highlights of their vision:

• SWL has proposed an inclusive, high-density, technologically driven community that reflects

forward-looking trends in transportation, housing and use-types. This community will be

comprised of residents from a range of socio-economic backgrounds, and at various life

stages.

• Technologically informed investments in infrastructure are proposed that will have the ability

to actively manage demand in order to produce more sustainable and efficient outcomes.

• To that end, the SWL development plan, as proposed, envisions some 53,000 residents

occupying 35,000 residential units in the Eastern Waterfront. Amongst these units will be a

notable mix of ownership and rental offerings, in addition to non-market housing designated

for various levels of the affordability spectrum.

• Almost 44,000 permanent jobs are expected to be supported across the Eastern Waterfront.

The majority of these jobs are expected to be office-based uses; however, a significant amount

of retail-commercial employment will also be provided, among various other social and

production-based employment activities.

• SWL envisions a full build-out of Phase 1 and Phase 2 of the project to be completed by 2040,

representing a significantly accelerated development timeline relative to the Baseline scenario

presented in Section 2.0.

• SWL supports the creation of a comprehensive LRT network throughout the Eastern

Waterfront, to be delivered on an accelerated timeline. To assist with the implementation of





this network, SWL has proposed optional financing support for the LRT expansion in order to

accelerate the delivery of a comprehensive transit network serving the development.

• SWL envisions the development of an Urban Innovation Cluster in the broader Eastern

Waterfront. Space provided to foster the growth and development of local technology-

oriented start-ups, academic institutions, research institutions and experimental pop-ups will

be included. This investment is intended to facilitate the emergence of Toronto’s Eastern

Waterfront as a global leader in Urban Innovation. Furthermore, SWL has proposed relocating

Google’s Canadian headquarters to the Eastern Waterfront as part of the development of

Phase 2.

• SWL has proposed a new use type—termed “Loft” space—as part of their vision for the

Eastern Waterfront. The Loft use type is intended to be driven by flexibility and modularity,

ensuring that as market trends and consumer needs change over time, the physical space can

be responsive and adapt to different uses without requiring major changes to a building’s

physical footprint or layout. Approximately 15% of the total gross floor in SWL’s build program

is designated as Loft space, totalling some 5.0 million square feet of readily convertible space

that can actively respond to market trends and local needs. SWL refers to this approach to

flexibility in design as “Radical Mixed Use”.

• The development is planned to be primarily constructed using tall timber, sourced as much as

possible from Canadian forests. In addition to the environmental, sustainability and efficiency

opportunities afforded by tall timber construction techniques, this initiative would represent

the largest timber-based development in the world.

Additional detail as to the unique economic and social benefits of Tall Timber, the proposed Urban

Innovation Cluster and design flexibility have been provided in Section 4.0 of this report.





Figure 3-1: Summary of Key Statistics – Development Program (SWL Vision)

Quayside Population: Employment: Number of Units: Gross Floor Area: Completion Date: Construction Cost:


Phase 1



Keating West Population: Employment: Number of Units: Gross Floor Area: Completion Date: Construction Cost:


Keating East Population: Employment: Number of Units: Gross Floor Area: Completion Date: Construction Cost:


Villiers Island Population: Employment: Number of Units: Gross Floor Area: Completion Date: Construction Cost:






Polson Quay Population: Employment: Number of Units: Gross Floor Area: Completion Date: Construction Cost:


McCleary District Population: Employment: Number of Units: Gross Floor Area: Completion Date: Construction Cost:


Total Phase 2* Population: Employment: Number of Units: Gross Floor Area: Completion Date: Construction Cost:


Grand Total (Phase 1 + Phase 2)



SOURCE: urbanMetrics inc., based primarily on development concept information obtained from Sidewalk Labs and other input assumptions developed by urbanMetrics. NOTE: Gross Floor Area figures include existing space identified to be maintained. Total construction costing shown is

comprised of both hard and soft costs. Numbers may not add up due to rounding.

*Phase 1 includes: Quayside; Phase 2 includes: Keating West, Keating East, Villiers Island, Polson Quay & McCleary District.

Grand Total (Eastern Waterfront) includes the Phase 1 Phase 2 lands.





3.2 Assumptions In addition to the common and equivalent analytical assumptions outlined in Section 2.2, the

following must also be considered as uniquely relevant to the vision articulated by SWL for the

Eastern Waterfront.

• SWL Development Concept – Development figures (i.e. total floor area estimates, detailed

allocations by land use) and subsequent supporting assumptions (i.e. population, employment,

construction costs, development timing and phasing etc.) have been obtained directly from

Sidewalk Labs. These figures have been independently derived by SWL, and reflect their vision

for the ultimate build-out of the Eastern Waterfront. urbanMetrics has utilized the figures

provided as the underlying basis for our economic impact analysis, plus the accompanying

reporting presented herein. For the purposes of this analysis, figures provided by SWL are

assumed to provide an appropriate and accurate representation of the composition, delivery

and costing of the project, as planned. As the development concept continues to be refined,

input construction costs may be subject to change. The figures cited throughout this report are

assumed to provide an accurate representation of the magnitude of expenditure and

economic impact anticipated in realizing SWL’s ultimate vision.

• Municipal Rates – Based on the build-out program and supplementary information provided

by SWL, urbanMetrics has estimated the potential municipal revenue that may accrue to the

City of Toronto. Rates for property tax revenues, development charges and planning fees have

all been determined based on current City of Toronto rates and ratios for 2018.

• Employment Composition – Based on information related to the allocation of commercial

space, specific planned investments/initiatives and marketing of the Eastern Waterfront (e.g.,

the proposed Urban Innovation Cluster, Google’s proposed Canadian HQ Relocation, etc.), as

well as conversations with representatives of SWL, urbanMetrics has developed an

understanding of the anticipated composition of employment uses throughout the Eastern

Waterfront. In conjunction with our understanding of current employment patterns in various

other comparable employment districts throughout the United States, urbanMetrics has

estimated the unique employment allocation by industry category for the Eastern Waterfront.

For the purposes of developing a high-level understanding as to the potential ongoing

economic impacts of this local labour force, our allocation is assumed to provide an accurate

and reasonable representation of the potential future composition of employment within the

fully built-out community.





3.3 One Time Impacts (Construction)


Based on the results of our economic impact analysis—for which our approach has been outlined in

Section 1.4 and Appendix A at the end of this document—the economic impacts of the full build-out

of SWL’s vision for the Eastern Waterfront would generate significant economic value across the

economies of Toronto, Ontario and Canada. A significant portion of this revenue would be realized in

the City of Toronto, providing direct benefit to existing businesses and services.

The total value of construction throughout the development plan has been estimated at some $17.9

Billion, inclusive of both Hard Construction Costs and Soft Costs, as defined in Section 2.3 of this

document. This total capital spending would be shared among Sidewalk Labs, other real estate

developers/partners, other potential investors, and lenders, with third-party equity and debt

representing the bulk of the spending over time

As detailed below, the one-time construction expenditures associated with the build-out of SWL’s

vision of the development concept—including direct, indirect and induced impacts—will generate:

• ±$17.6 Billion in value added to the Canadian economy ($12.8 Billion in Toronto);

• ±135,900 full-time person years of employment (103,000 in Toronto)14,15;

• ±$11.0 Billion in labour income ($8.5 Billion in Toronto); and,

• ±$7.1 Billion in revenues to the three levels of government, in the form of personal tax,

corporate tax, and other taxes16 (with approximately $1.9 Billion available at the municipal

level in Toronto).

14 These employment figures represent the full-time, full-year jobs generated by the intial direct capital investment in

buiding construction, as well as the indirect and induced impacts that are spread more broadly throughout the regional,

provincial and national economies. For the types of expenditures analyzed in this portion of our study, the employment

figures represent total years of full-time employment (e.g., one job identified represent the equivalent to one person

working full-time for the duration of one year).

15 Employment impacts and related multipliers have been adjusted (i.e., deflated) to reflect more accurate annual income statistics available for the City of Toronto and Province of Ontario.

16 Other taxes include: Federal Trading Profits, Federal Gas Tax, Federal Excise Tax, Federal Duty Tax, Federal

Environmental Tax, Federal Air Transportation Tax, Federal Sales Tax, Import Duties, Federal Taxes on Production,

Provincial Environment Tax, Provincial Gallon Tax, Provincial Trading Profits, Provincial Gas Tax, Provincial Amusement Tax,

Other Provincial Consumption Taxes, Provincial Sales Tax, Provincial harmonized Sales Tax, Provincial Taxes on Production,

Municipal Amusement Tax, Municipal Sales Tax and Municipal Taxes on Production.





The infographic in Figure 3-2, provides a similar overview and illustration as to the unique economic

impacts resulting from the construction of the entirety of the vision outlined by SWL. A more detailed

table of the specific direct, indirect and induced impacts across various geographies, has been

included in Appendix B.

See Appendix B for a more detailed economic impact summary tables.





Figure 3-2: Economic Impact Summary – Building Construction (SWL Vision)






Infrastructure

Beyond the economic benefits associated with the construction of the various buildings throughout

the Eastern Waterfront, a significant investment will be required to provide the underlying

infrastructure necessary to adequately support the new communities. Additionally, existing

infrastructure must be upgraded to position the subject lands in order to accommodate the scale and

intensity of investment proposed across the Eastern Waterfront.

The SWL development scenario also proposes a number of notable deviations from the traditional

method of infrastructure provision seen across the City of Toronto and elsewhere across North

America. Although the quality of services and physical standards are intended to meet or exceed

those of the City of Toronto, SWL has proposed a range of additional innovative and technologically

driven infrastructure investments that may require higher initial capital outlays. Similarly, SWL

supports the need for a comprehensive LRT network for the Eastern Waterfront, and has proposed

optional support in the upfront financing of this infrastructure to offset the initial capital cost.

Based on estimates provided by SWL as part of their own internal infrastructure costing, the related

investment required for the build-out of the Eastern Waterfront has been valued at some $5.2 Billion.

This upfront and one-time capital investment in infrastructure includes expenditures relating to

sitework, civil infrastructure, public realm improvements, bridges, stormwater management,

thermal/power grid implementation, road management, as well as the proposed extension of Light

Rail Transit (LRT) service along Queens Quay East, among other relevant spending. We note that as

the ultimate development concept evolves through broader community engagement and municipal

planning processes, and as understanding of the costs associated with providing these unique

amenities, the ultimate infrastructure investment figure may change. However, the figure cited above

is believed to be sufficiently accurate for the purposes of this type of economic impact report, and

any potential difference in actual costs would represent a relatively insignificant deviation.

Similar to the findings presented in the previous subsection for building construction impacts, the

following outlines the key economic impacts associated with this level of infrastructure spending

under the Sidewalk Toronto vision.





Figure 3-3: Economic Impact Summary – Infrastructure (SWL Vision)






Municipal Fees

In addition to the more significant one-time and nation-wide benefits identified in the previous

subsections of this report, the full build-out of Phases 1 and 2 of the SWL vision would also generate

significant one-time revenues to the City of Toronto in the form of development charges and

associated planning application fees. As shown in Figure 3-4, the full build out of the Eastern

Waterfront would yield approximately $967 Million in one-time municipal revenues, based on 2018

rates17. Phase 1 would account for some $61 Million of the total one-time municipal revenues

realized as part of the SWL vision.

Figure 3-4: One-Time Municipal Revenues Summary (SWL Vision)

SOURCE: urbanMetrics inc., based on City of Toronto 2018 Planning Fees.

17 Includes development charges, Official Plan amendment and Zoning By-law amendment fees. Estimate does not include Plan of Subdivision, Plan of Condominium, nor any other one-time municipal fees. Fee estimate is subject to change based on the ultimate development concepts advanced to the municipality, as well as the unit composition and overall mix of uses proposed.





3.4 Recurring Impacts (Occupancy)


In addition to one-time employment generated through the planning and construction of the Eastern

Waterfront, Figure 3-5 identifies the potential permanent on-site employment that could be

accommodated within the various newly constructed and/or renovated existing buildings throughout

SWL’s vision. These employment estimates are derived from the total build-out concepts identified

for the subject lands, as well as average employment density factors applied to each of the major land

use categories identified.

As shown, full build-out of the proposed SWL concept could ultimately accommodate a total of some

44,200 permanent jobs upon full build-out, with a significant amount to be concentrated in office-

based job categories. Almost 4,000 of these jobs would be accommodated in Phase 1 (Quayside).

Figure 3-5: Permanent On-Site Employment (SWL Vision)

SOURCE: urbanMetrics inc. Work at home employment calculated separately from permanent on-site jobs.

Based on the employment estimates shown above and as input to our analysis of the ongoing

operating output of the future employment base in this area, we have estimated the likely

employment composition of the broader Eastern Waterfront by industry sector. This assumed

employment allocation has been adjusted from that shown in Section 2.4 for the Baseline scenario.

The assumed employment composition has been adjusted based on urbanMetrics’ understanding of

the broader vision for the area, developed through detailed materials and engagement sessions with

various members of the SWL team. In addition, commitments made by SWL as part of the project

proposal (i.e. proposal to relocate Google’s Canadian Headquarters, establishment of an Urban

Innovation Cluster) have provided additional context for our assumptions. From this understanding,





and based on precedents across other jurisdictions and notable new technology-focused employment

districts across the United States, urbanMetrics has made assumptions regarding the likely

composition of employment uses by industry category across the Eastern Waterfront, shown in Figure

3-6.

Figure 3-6: Assumed Employment Composition by Industry (SWL Vision)


Estimates shown include additional “work from home” employment.

As shown, increases to the future employment base in this area have been allocated to the following

industry categories: Professional, Scientific and Technical Services; Management of Companies and

Enterprises; and Health Care and Social Assistance. This is consistent with the vision articulated by

SWL, and the proposed breakdown of non-residential use types.





Operating Output

Relying on available Statistics Canada data, the total employment estimates identified for SWL’s vision

(Figure 2-5) and the above employment composition assumptions (Figure 2-6), we have determined

the total operating output of the future employment base as part of the overall build-out of the

Eastern Waterfront. In particular, the total employment within each industry sector identified has

been multiplied by relevant GDP output per worker factors to estimate the total operating output of

this area. Estimated at some $13.2 Billion for Phase 1 and Phase 2, this figure has been used as the

main input for this portion of our economic impact analysis and represents the recurring (annual)

operating activities of the future businesses within the area.

Similar to the earlier graphics detailing the impacts of new building and infrastructure construction,

Figure 2-7 provides a summary as to the total economic impacts derived from the annual operating

activities of the SWL vision for the Eastern Waterfront.





Figure 3-7: Economic Impact Summary – Annual Operating Output (SWL Vision)







Based on estimated assessment values, and 2018 City of Toronto tax rates, we have developed annual

property tax revenue estimates for each asset class. As shown in Figure 3-8, the development of

Phase 1 and 2 of the SWL vision is expected to generate some $150 Million in annual property tax

revenue by the year 2040.18

Similarly, Figure 3-9 provides an illustration as to how these municipal revenues could ultimately grow

over the full planning horizon for the Eastern Waterfront on a cumulative basis. As shown, during the

period between 2025 and 2040 (i.e., the estimated completion date for all development under the

SWL development scenario), new development within the subject lands will have generated a total of

some $1.6 Billion. During the extended period from 2025 to 2050 (i.e., the corresponding date of

completion for the equivalent Phase 2 geography under the Baseline scenario), new development will

have generated a cumulative total of some $3.3 Billion.

Figure 3-8: Recurring (Annual) Property Tax Revenues (SWL Vision)

SOURCE: urbanMetrics inc., based on City of Toronto property tax rates and estimates of future assessment values for the

full build-out program of the Eastern Waterfront. Estimates relate to new buildings only, as well as some selected

buildings which are expected to remain throughout the redevelopment process, per the Baseline scenario assumptions.

18 This analysis does not consider the eligibility of the subject developments for any property tax rebate programs currently offered by the City of Toronto. As such, the property tax estimates shown throughout this report represent an estimate of the total property taxes that could be payable to the City over the time periods presented, in the absence of any discounts or rebates.





Figure 3-9: Cumulative Property Tax Revenues, 2025-2050 (SWL Vision)

SOURCE: urbanMetrics inc., based on City of Toronto property tax rates and estimates of future assessment values for the

full build-out program of the Eastern Waterfront. Estimates relate to new buildings only, as well as some selected

buildings which are expected to remain throughout the redevelopment process, per the Baseline scenario assumptions.

3.5 Other Benefits In addition to the main one-time and ongoing economic benefits highlighted above for the SWL

development scenario, the vision outlined by SWL for the Eastern Waterfront could also bring a

variety of spin-off benefits relating to broader city-building initiatives, incorporating new

technological advancements into urban development, and other efficiencies. A few of these benefits

have been summarized below.

• SWL has proposed that full build-out of both Phases 1 and 2 of their vision will be completed

by 2040, representing a significant acceleration to developing one of the most underutilized

areas in Toronto, thereby maximizing the economic value associated with ongoing flood-

proofing initiatives and other government investments. Relative to the baseline scenario, this

expedited timeline would facilitate the earlier delivery and operation of public transit

investments, capture additional property tax revenues, as well as produce a more immediate

supply of significant housing in close proximity to downtown Toronto.

• SWL has prioritized a network of LRT infrastructure to provide improved transit accessibility

to the immediate areas, as well as benefitting residents and employees throughout other parts





of the City/Region that rely on the existing transportation network. Furthermore, SWL has

proposed working collaboratively with local governments to explore how they could play an

optional supporting role in a financing scheme that would facilitate expedited construction of

this expanded LRT infrastructure.

• SWL’s commitment to developing the new communities in the Eastern Waterfront with a

focus on tall timber construction represents an opportunity for the City of Toronto to become

a global leader in sustainable building technology. Furthermore, the SWL project could

catalyze the development of a Cross-Laminated-Timber (CLT) industry in Southern Ontario that

not only captures a larger portion of this type of production in Canada currently, but also

presents opportunities to increase forestry and manufacturing-related jobs in the coming

years. This could ultimately support similar projects throughout North America based on the

precedent set by SWL.

• The SWL development proposal contemplates the introduction of a flexible design use format

identified as “Loft” space. This space is intended to be modular in nature, and able to be easily

converted from residential to non-residential uses as market demand dictates. This could bring

with it a number of related spin-off benefits, including reduced down-time between tenants

and facilitating growth among local businesses.

Section 4.0 provides a more detailed discussion of several of these key features and differentiating

factors of the SWL proposal. In particular, it explores the unique economic benefits and potentially

legacy impacts of this type of development, with particular focus on: the use of Tall Timber

construction techniques, the presence of a new Urban Innovation Cluster in the Eastern Waterfront,

the proposed relocation of Google’s Canadian Headquarters, as well as the adoption of Flexibility in

Design.





4.0 Differentiating Factors





Sidewalk Toronto represents a new paradigm for Toronto. And the world is watching.

From an economic development lens, there are three distinguishing features that we believe

underpin the advantages that SWL bring to the Canadian economy. These differentiating factors have

the potential to catapult Toronto, Ontario and Canada into a clear leadership position in terms of

pioneering scalable solutions that address complex global challenges facing cities and communities of

all sizes.

Specifically, the Sidewalk Toronto project will:

1. Solidify Toronto’s pedigree as the gold-standard for responsible implementation of urban

innovation technologies and practices, which promote sustainability and mitigate climate

change.

2. Leverage Canada’s position as a global forestry-products powerhouse for the

development of an internationally significant concentration of expertise in high-rise, tall-

timber construction.

3. Establish a new pedestrian-focused city-building template that supports flexibility,

adaptability and incrementalism.

4.1 Urban Innovation Cluster / Google Canadian

HQ The City of Toronto is revered the world over for its high quality of life and its competitive business

climate. Toronto is widely regarded as one of the most desirable and most dynamic cities in the world.

Canadians are proud of the leadership role they play on the international stage, and the City of

Toronto is a mirror reflection of the global perspective that Canadians maintain. The fact that Toronto

was chosen by Sidewalk Labs as its preferred partner is a testament not only to the global influence

Canada plays, but more importantly its clear commitment to sustainability, which builds on the pillars

of innovation, design-excellence, good-governance, as well as openness and transparency. These

attributes provide the backdrop for transforming the City of Toronto as a world leading urban

innovation cluster.

Toronto is a city defined by its people and its neighbourhoods. It is also defined by

intense growth.





Among North American cities, Toronto is home to

one of the fastest growing metropolitan areas. Over

the past five years, Toronto has, on average, added

more than 100,000 persons per year. In absolute

terms, Toronto added more residents than New

York, a city which supports a base population 4.5

times Toronto’s size.

Migration continues to play an important

role in the ascendency of Toronto as an

inclusive, global-minded city.

According to the 2016 Census, almost half of

Torontonians were born outside of Canada. Among

its North American peers Toronto has a far deeper

global reach, with almost 45% of its population

being foreign-born.

From a quality of life perspective Toronto is

consistently rated as a top-tier city.

Mercer’s 2018 Quality of Live Index, for example

ranks Toronto ahead of all major American cities, including San Francisco, New York, Boston, Chicago,

Seattle and Washington DC. PwC recently ranked Toronto as the third best city to live and work

(behind London and Singapore, ahead of Paris and Amsterdam). The Intelligence Unit of the

Economist ranked Toronto as the safest city in North America and the fourth safest in the world, plus

the 2018 Innovative Cities Index places Toronto as the eight most innovative city, based on a series of

over 160 key indicators.

Thanks to an international perspective and deep connections to overseas markets,

Toronto has emerged as a place where ideas and innovations are celebrated – although

not always fully implemented.

Over the past several decades, Toronto has quietly—yet deliberately—built its research capacity

through strategic investments in key areas such as health sciences, IT and mobile communications.

Toronto has also established a globally significant market presence in the field of artificial intelligence

and machine learning, thanks in large part to the pioneering efforts and influence of Geoffrey Hinton,

commonly referred to as the Godfather of AI.

Toronto is home to several top-tier universities and research institutes that continue to

grow in prominence and depth.

SOURCE: Toronto Global, 2017.

Figure 4-1: Population Change, 2011-2016

Figure 4-2: Percent of Foreign-Born Population

SOURCE: Toronto Global, 2017.





Toronto’s top academic institutions (University of Toronto, Ryerson University and York University)

and its leading research hubs (MaRS, Vector Institute for AI, DMZ-Ryerson, and others) feed a wide

pipeline for talent and technology transfer.

According to CBRE (2017), Toronto was rated as the 6th

most dynamic labour market for technology-related

talent in North America, and 3rd overall when it comes

to the share of its employment base engaged in

technology-related occupations.

Toronto has a diversified economic base that is

anchored by eight key industry pillars, including:

financial services, film and media, transportation,

healthcare, education, construction and food

production. This diversified base provides the platform

for a new generation of cross-disciplinary innovators that help keep Canadian businesses at the

forefront of global markets.

SWL Supports Canada’s Innovation Agenda

The Government of Canada is firmly committed to an innovation agenda that supports business-led

job creation through targeted investments in infrastructure, training, research and development,

commercialization and targeted funding programs designed to allow innovators to achieve scale and

success.

As part of its global commitment to combat climate change, the federal government has established a

12-year plan, Canada’s Implementation of the 2030 Agenda for Sustainable Development, which

outlines its support for accelerated infrastructure investments that make Canadian cities and towns

more inclusive, safe, resilient and sustainable. To this end, the Government of Canada has earmarked

$180 billion of investment stimulus to support priority investments in transit (including traffic

management), affordable housing (including other social infrastructure) and green infrastructure

(including clean water, renewable energy and solid waste recovery).

As a rapidly growing urban region, Toronto’s “big-city” problems require bold, multi-

layered solutions that alleviate specific social, economic and environmental challenges,

especially those which erode the prospects for income equality and prosperity.

The ability to address these challenges head-on and develop scalable, transferable solutions

represents one of the core aspirations of the Sidewalk Toronto project.

Figure 4-3: Tech Labour Concentration

SOURCE: CBRE Group, 2017.





Toronto as an Urban Innovation Leader

Toronto is a progressive city that understands the importance of compact urban form,

good design and strong civic leadership.

Reinvestment in older central areas of Toronto such as Liberty Village, King-Spadina, Corktown and

the Distillery District have resulted in new residential neighbourhoods and dynamic business zones.

History has shown that these areas have evolved quickly, attracting the interest of leading-edge

companies and important cultural enterprises. Quickly, momentum begins to shift to residential uses,

as workers seek housing options closer to where they work.

While tourists are attracted to Toronto by its modernity, safety and big-city flair, talent—or human

capital—is attracted and retained by the allure of strong learning institutions, a dynamic business

environment and liveable urban neighbourhoods.

Over the past two decades Toronto has become a decidedly more urban city.

The housing market has shifted from predominantly ground oriented townhomes and midrise

buildings to (almost entirely) high-rise apartment structures. Since 2000, nearly 215,000 new

apartment units have been completed in Toronto, yet this number continues to fall well-short of

market demand. Housing continues to be a major issue in Toronto despite an unprecedented and

prolonged period of intense residential construction activity.

As of July 2018, Toronto has more active high-

rise construction cranes (97) than any other

city in North America. In fact, there are

more cranes in active duty in Toronto than

New York, Washington and Boston

combined. According to the RBL Quarterly

Crane Index, more than 80% of the cranes

in active duty support residential-oriented

development. Looking forward, RBL

identify upwards of 400 additional high-rise

projects in the city’s development pipeline.

Toronto’s intense focus on urban-

living, has informally—yet very

clearly—transformed Toronto into a

living lab where various players, including: developers, lenders, policy makers,

entrepreneurs, designers and tradespeople are all pushing the innovation envelope to

support and fulfill market growth prospects.

Figure 4-4: Crane Counts in North America

SOURCE: RBL Quarterly Crane Index, 2018.





A key indicator for Toronto’s ambition as an urban innovation hub is tied to its higher-learning

institutions. Toronto’s two downtown universities act as a magnet for talent and innovation.

Increasingly, Toronto’s universities are drawing on students and researchers pulled from major

international markets in China, India, Europe, Latin America and Africa.

The University of Toronto, for example, has recently formalized its ambition to become a global

centre for excellence in urban research. In 2018, the University launched the School of Cities, an

initiative which brings together over 220 researchers and academics focussed on: innovation and

enterprise, infrastructure and sustainability, healthy cities, socio-economics, urban policy, and

governance. Similarly, in 2018, Ryerson University also launched the Centre for Urban Innovation, a

collaborative research facility focussed on: alternative energy, water management, food production,

body metrics and human health, data analytics and urban infrastructure.

The combined intent of these two downtown universities underscores the growing public interest in,

and expectation for more sustainable and equitable solutions to complex urban problems. It also

demonstrates the growing demand for occupations connected to urban planning, community

development, architecture, transportation and other city-building disciplines.

Digital solutions play an increasingly central role in shaping city structures and the way

residents interact directly with the people and services available in their community.

The arrival and rapid adoption of sensors in private spaces (homes, office and vehicles) combined with

the ubiquity of smartphones and other mobile devices will inevitably lead to broad-based adoption of

internet-enabled goods and services in cities throughout the world, including those delivered by, or

on behalf of government.

The imminent arrival of 5G networks will clear the pathway for a new layer of data sophistication,

increasing the bandwidth of smartphones and sensors to deliver important alerts, insights and actions

that will facilitate faster and more effective services to the residents, including: healthcare, public

safety, security, energy and mobility.





A 2018 study conducted by the McKinsey Global Institute

determined that the deployment of so-called smart-

city technologies could improve key quality-of- life

indicators by upwards of 10% to 30%. These

improvements directly and indirectly translate into

better human outcomes, including: the number of

lives saved, reduced travel times, shorter hospital

wait times, lower incidences of crime and reduced

smog levels.

The extent to which Toronto will openly

embrace all smart city interventions is still a

matter of debate.

Nonetheless the promise of new urban technologies

enabled by 5G will certainly help to advance key

policy objectives designed to mitigate congestion,

public health and environmental challenges.

The City of Toronto has recently implemented

TransformTO an ambitious plan intended to reduce

local greenhouse gas emissions, improve health, grow the economy, and improve social equity.

TransformTO provides a clearly articulated road map—including specific targets—for reducing waste

and improving the lives of all Torontonians through better decision-making.

Toronto’s commitment to climate change solutions has helped advance the prospects

for a growing clean-tech sector comprised of firms engaged in water management,

waste reduction and alternative energy solutions.

The development of urban innovation systems requires a myriad of actors. Governments acting in

isolation are not adequately equipped to deliver the innovations needed to fully support cost

effective service delivery. Similarly, major building owners and landlords rarely possess all of the in-

house expertise to develop advanced building management systems, such as those designed to make

elevators run more efficiently or heating controls that reduce energy.

Figure 4-5: Smart City Benefits

SOURCE: McKinsey Global Institute





SWL as a City-building Catalyst

Over the past year, the Sidewalk Toronto project has garnered unprecedented

attention from international media, bloggers, tech-enthusiasts and city-watchers alike.

From an economic development perspective, the level of public discourse around the Sidewalk

Toronto initiative amplifies the message that this city has the energy, focus and discipline needed to

effectively integrate shared and open-data platforms that fully uphold the integrity of individual

privacy rights.

Externally, Sidewalk Toronto has, and will continue to, reaffirm the Toronto’s brand position as a Top-

10 global destination for investment, innovation and talent recruitment. A deeper focus on urban

innovation, which broadly includes clean-tech, prop-tech and transport-tech, will draw students,

researchers, innovators, entrepreneurs as well as seasoned business leaders to the Toronto market.

On the ground, the Sidewalk initiative will re-invigorate a part of Toronto’s iconic

waterfront that few residents have actually visited.

In the short-term, the project will bring new life and animation to an otherwise neglected part of

Toronto. In a similar—albeit radically different way—to the nearby Distillery District, redevelopment

of the Eastern Waterfront will advance the transformation of under-utilized industrial assets, as well

as preserving and strengthening the importance of the film district as a key emerging industry in the

Eastern Waterfront. Quayside and the various other sub-districts throughout the Eastern Waterfront

represent entirely new city precincts with their own unique character and identity. These areas will

evolve and develop over time as an integrated part of the urban fabric of Toronto, a place where

Torontonians will live, work and play.

The Sidewalk Toronto intiative also carries with it a unique opportunity to develop

several new nodes of employment activity.

A central feature of the Sidewalk Toronto vision includes the proposed relocation of the Google

Canada HQ from its current location in the financial core to a new site in the Eastern Waterfront area.

The proposed relocation of Google Canada’s headquarters provides a foundational platform (a

business anchor) for other tech-focused businesses to play a collaborative role in the creation of a

new tech cluster with immediate legitimacy and draw.





4.2 Tall Timber It is no secret that Canada is a global forestry powerhouse.

Its vast territory accounts for about 10% of the world’s total forestry cover, and upwards of 30% of

the world’s total boreal forests. Canada is also a world leader when it comes to ensuring innovative

and sustainable forestry management practices that safeguard our wood resources for future

generations.

Canada’s forest industry feeds a global market for lumber and value-added wood products such as

architectural and advanced structural components. Canada’s forestry sector represents about 1.3% of

the national economy and functions as a

critical economic driver for hundreds of

small, medium and Indigenous communities

across Canada.

Today, Canada’s forest industry directly

employs approximately 210,000 workers

from coast to coast. Thanks to solid

economic gains in the US economy,

Canada’s wood manufacturing sector

(including producers of lumber, plywood,

veneers, etc.) has shown steady signs of

growth following the collapse of the US

housing market in 2008.

The pulp and paper industry, however, has

seen a systematic decline, as consumers move

away from newsprint and other paper products. Over the past decade Canada’s pulp and paper

industry has seen nearly one-third of its workforce—more than 30,000 jobs—eliminated as a result of

macro-shifts to paperless forms of communication. Many communities in Northern Ontario in

particular have struggled as a direct result of production cutbacks and mills closures related to the

pulp and paper sector.

Despite some challenges for the forestry sector as a whole, the general outlook for wood products

remains relatively healthy as new applications and new markets for wood emerge. As the world

advances toward a more carbon-neutral position, the prospects for wood-based solutions are

generally seen as more desirable compared to more carbon-intensive materials such as steel,

concrete and plastic.

SOURCE: Ministry of Natural Resources, 2018.

Figure 4-6: Forestry Direct Employment, 2007-2017





Tall Timber

Over the past 10-15 years, new technologies in wood manufacturing have enabled the

development of taller, stronger and more efficient building structures that leverage

both the aesthetic and ecological benefits of wood.

A new movement in architecture and building science continues to emerge, which is rapidly proving

the benefits of wood-oriented construction. The move to wood is not simply a function of the

ecological benefits and superior design properties of wood, but rather the economic and financial

benefits that wood provides relative to conventional steel and concrete options.

To date, the height of most tall-timber buildings has fallen somewhere in the range of eight to ten

stories; essentially a mid-rise building by Toronto standards. However, innovation and construction

practices have moved swiftly, and the size and complexity of tall-timber projects has grown

measurably. In a few short years, the number of timber-projects around the world has grown

substantially and building heights are now beginning to soar to previously unthinkable heights.

In 2017, the University of British Columbia established a new pinnacle for tall timber construction

with the delivery of a new 18-storey (53-metre) student residence. The project, Brock Commons, has

quickly achieved the status of an international best practice for tall timber construction not simply

because of the way it looks and feels, but also because of the speed with which it was built; a

remarkable 70 days.

Today, there are over 35 active tall timber construction projects on the books, including projects in

Tokyo, London, Chicago, Philadelphia, Stockholm, Paris, Vienna and Amsterdam. These projects range

in size from 20+ storeys in historic cities such as Amsterdam and Vienna, all the way to super-tall

structures comprising between 70 and 80 storeys in major metropolises like Chicago, London and

Tokyo.

As the tall timber industry takes-off, Canada should be in the ready-position to supply

not only design and engineering expertise, but also the structural wood materials and

componentry that will provide strength and stability to this fledgling enterprise.

Playing a central role in the supply chain for tall-timber construction—both domestically and

internationally—should be viewed by Canadian companies and industry representatives as a major

growth opportunity for the Canadian economy.

Building on the promise and momentum of tall-timber construction, the University of Toronto and

George Brown College co-created the Mass Timber Institute based in Toronto. This initiative was

established to help mobilize the forestry sector, building science experts and construction trade

representatives to build collaborative partnerships that will advance tall-timber construction practices

across Canada and internationally.





The Ecological Case for Tall Timber

Aside from the obvious aesthetic qualities, the case for wood-based construction is deeply rooted in

the ecological integrity of wood. Wood is a natural resource that is 100% renewable and—unlike

other construction materials, namely steel and concrete—it actually stores carbon rather than

expending it into the atmosphere.

Case in point: the construction of a typical 100,000 square foot commercial building made of timber

would result in significantly less carbon emissions than its steel and concrete equivalent. The Wood

Product Council estimates that the direct carbon reductions for a new, modestly-sized 100,000 square

foot wood building would eliminate more than 700 metric tonnes of green house gas emissions. This

would be the equivalent to removal of 200 vehicles from the road for a period of one year.

The regenerative aspect of utilizing wood is also a compelling argument for taking advantage of wood-

based construction. The amount of wood fiber required to erect a 100,000 square foot tall-timber

structure—roughly 15,000 cubic feet—is regrown in Canada’s boreal forests in a matter of less than 2

minutes.

The Business Case for Tall Timber

As a renewable resource, SWL’s commitment to tall timber construction is supported by four key

economic benefits:

• Leveraging Domestic Wood Capacity

Canada’s forestry sector is currently operating well below its full production capacity. Structural

changes in demand for pulp and paper products have had a destabilizing impact on many resource

communities across Canada. Tall-timber has the potential to become an entirely new building-

materials subsector that will supply domestic, US and global markets.

• Industry Repatriation

Tall-timber builders in North America currently rely on a network of product suppliers, many of whom are situated in the European Union. Austria and Sweden, for example, are two countries that support a robust and innovative concentration of tall-timber suppliers, including leading fabricators of customized CLT and other wood-based mass timber components. The rapid deployment of tall timber construction on Toronto’s waterfront has the potential to directly support commercialization and innovation for a broad range of industry players within Canada’s domestic forestry and building sector. Our estimates suggest that the construction of the Sidewalk Toronto vision could require between 900,000 – 1,200,000 cubic metres of CLT. Over a 20-year build-out period, this would translate into an annual demand of 50,000-55,000 cubic metres of CLT. Based on typical CLT-factory outputs, this volume of material would support and necessitate 1.0 to 1.5 new production facilities just to support the SWL vision. In term of direct and indirect





employment, including manufacturing, sawmill, transport and logging jobs, the build-out of Phase 1 and Phase 2 of the Sidewalk Toronto project, as proposed, would support upwards of 2,500-person years of employment to supply the CLT materials on Toronto’s Eastern Waterfront. It is expected that these positions would be drawn, almost exclusively, from the Ontario labour market.

• Leading Innovation

While the number of tall-timber buildings globally is still relatively small, Canada’s forestry and

construction industries are extremely well-positioned to take a global leadership position in an

industry that is still very much in the early stages of development. Sidewalk Toronto has drawn

international attention because of its bold and ambitious commitment to wood construction. The

ability to realize this vision will require new products and novel construction innovations that have

the potential to become a new global standard for city-building.

• Speed to Market

Housing affordability in major urban centres such as Toronto is a growing crisis. Tall timber has the

potential to significantly reduce the overall costs of construction through faster and more efficient

development programs. Custom-designed and factory-built CLT-wood beams, as well as floors,

doors, windows and wall systems enable quick on-site construction. The advantages of rapid

construction enable developers and homebuilders to respond quickly to market needs, while at

the same time minimizing often-extensive disruptions (i.e. noise and traffic) on neighbouring

properties.





4.3 Flexibility in Design / Radical Mixed Use Of all the exciting changes that have occurred in central Toronto over the past 25 years, one major

planning policy shift stands out as a watershed moment that has truly cemented Toronto’s status as a

North American leader in downtown revitalization and mixed-use thinking.

In 1997, the City of Toronto implemented

fundamental changes to its zoning bylaw that

enabled two languishing 19th-century

industrial areas located on the east and west

sides of the financial core to flourish by

eliminating many of the antiquated land-use

policy restrictions.

The two “Kings” started off as a pilot project in

the King-Spadina and King-Parliament in the

centre of Toronto as a planning intervention to

support the revitalization of five to eight

storey historic industrial buildings, as well as to

kick-start the redevelopment of an area with a

creeping, and what appeared at the time, to

be a chronic over-supply of surface parking

lots.

The plan to drastically reduce excessive layers of regimented land use restrictions in

the Two Kings paid off.

In the 20 years that have passed since the introduction of the Kings Regeneration Areas policy, the

City of Toronto has seen unparalleled central investment within the 400+ acre land areas it was

targeted to rehabilitate.

Over two short decades, the City has seen the construction of more than 50,000 residential units in

the Kings, with thousands more still in various stages of construction, approval and planning stages.

The value of building permits issued in the Kings has been estimated by City of Toronto officials to fall

somewhere in the order of $8 billion over the past two decades.

In terms of job growth, the Kings have become one of the most sought-after locations

for technology and communication companies in Toronto. The Kings are now a prized

area for companies of all shapes and sizes who are looking to provide “brick and beam”

workplaces that support the ambitions and aspirations of younger workers.

Figure 4-7: Location of King-Spadina/King-Parliament






While employment has shown nearly 20% growth city-wide between 1996 and 2016, job growth is up

nearly 70% in the King-Spadina district and 30% in the King-Parliament district with more than 20,000

new jobs injected into these areas. Based on municipal data, over 52,000 people reportedly work in

the Kings, nearly 30% of them in the cultural, creative and technology-based occupations.

The transition of the Kings from languishing industrial no-go areas into thriving and highly successful

mixed-use districts did not happen without a series of small, incremental transitions in-between. The

liberalization of land uses in the mid-1990s simply enabled larger and more powerful waves of

tenants and space users to move into these districts. These businesses and individuals were able to

take advantage, reimagine and customize their spaces in ways that the original architects

commissioned in the 19th century would have never conceived.

The residents and businesses who ultimately re-discovered the benefits of big windows, large open

spaces and lofted ceilings during this period set the stage for success, but by no means did they

become the permanent gatekeepers and stewards of these spaces.

The Kings regeneration process has, and continues to, come in waves. These waves are established

and defined by constantly shifting cultural, generational and market changes. What seems growingly

apparent today is that these temporal changes are happening in more compressed and more intense

cycles.

As the pace of change in our society continues to modulate, big cities such as Toronto

need to be prepared for faster, more flexible and more responsive approaches that

enable these cycles to play out.

This doesn’t mean that everything is temporary, it simply means that flexibility by design should be

embedded into the way we build structures and urban spaces.

The Sidewalk Labs vision for the Eastern Waterfront is predicated on a new paradigm for city-planning

and design. The approach, at its core, embraces the need for flexibility to support ongoing and rapid

change rather than a plan that simply strives for fixed and static end-points.

From an economic development perspective, the Sidewalk Toronto project represents an opportunity

to achieve significant benefits for residents and business.

The notion of radical mixed use provides area inhabitants with the ability to grow and

adapt with their spaces rather than consume them for a limited, fixed period of time.

The Sidewalk Labs approach envisions an environment that is constantly evolving, without the need

for excessive rebuilding and redesign every time something changes.

SWL’s modularity and plug-and-play approach enables users and re-users of buildings and spaces to

adopt to temporal and seasonal shifts. The ability to work and live with agility allows individuals (and





government officials) to make space-related decisions in real-time, rather than constantly trying to

project out in five, ten, or thirty-year increments.

Making better informed decisions will enable those connected to communities

throughout the Eastern Waterfront to make real-time decisions that fit current

circumstances, rather than making ill-informed decisions, which may or may not play

out.





5.0 Tourism Impacts





In addition to quantifying the various economic impacts associated with the two potential

development scenarios identified for the Eastern Waterfront—as summarized in Sections 2.0 and

3.0—urbanMetrics has also undertaken a separate and distinct analysis to estimate the economic

impacts of tourism and related spending activities that can reasonably be attributed to the newly

developed lands under the SWL vision. Although it is extremely difficult to isolate and attribute

precise visitation estimates to the emergence of the Eastern Waterfront and its various sub-districts,

it is reasonable to assume that—at least at a high level—the full buildout of the community as

envisioned by SWL would realistically yield some additional tourism visitation to Toronto. This

visitation estimate would occur above and beyond any increased tourism associated with the

significant investments undertaken by Waterfront Toronto. These initiatives have driven significant

growth in visitation to the waterfront, which would be further increased by the realization of the

Sidewalk Labs vision. Increased tourism activity may ultimately be realized through “net new”

overnight visitation to the City among would-be travellers, or simply as a function of existing tourists

to the area spending an additional morning/afternoon in Toronto to experience the Eastern

Waterfront.

With the underlying assumption that Toronto’s Eastern Waterfront is developed per the vision

established by SWL, the area will undoubtedly attain national and international attention due to its

unique, technologically-driven approach to development and the one-of-a-kind nature of the new

communities being created. Notwithstanding the more immediate attraction of local amenities being

introduced (e.g., restaurants, cafes, shops, etc.), it is also likely that the SWL project will induce

additional tourism visits simply due to people’s heightened curiosity around new technologies and

urban innovations being implemented. In particular, we anticipate that this type of visitation could be

driven by urbanists, academics, policy-makers, as well as a range of other casual onlookers.

Overall, this innovative proposal will certainly add momentum to the already rapid growth in tourism

that Toronto has experienced in recent years.

5.1 Toronto Tourism Context To develop a more complete understanding as to how the development of a unique and innovative

neighbourhood in the Eastern Waterfront may influence tourism trends in Toronto in the coming

years, a profile of existing tourism activity in the City must first be established. From this baseline

understanding, we have been able to make additional assumptions relating to the potential extent of

future increases in tourism to the area, which are directly attributable to the future realization of

SWL’s vision for the Eastern Waterfront.





Overview

In 2017, the City of Toronto saw the attraction of over 43 million tourists, marking a 3.6% annual

increase from 2016, and the highest figure ever recorded in the municipality. Toronto has emerged as

an international tourism leader in recent years, identified as the 7th most visited city in the Americas

in 2017 and registering some 4.5 million international visitors. Furthermore, international visitation is

forecast to expand to some 5.8 million by 202519.

Toronto is often regarded as a “City of Neighbourhoods”—referring to the unique character,

pedestrian friendly scale, and interesting shopping, food and cultural opportunities available in

communities such as Chinatown, Kensington Market, the Annex, Koreatown and Queen West. In

recent years, Waterfront Toronto’s investments along Queens Quay to beautify and enhance park

space, cycling and pedestrian infrastructure and community event programming have led to a

profound increase in visitation to the area. In addition to functioning itself as a major attraction, the

revitalized waterfront has effectively become a conduit that serves to connect several of Toronto’s

most significant individual attractions and destinations, including the CN Tower, Toronto Islands,

Scotiabank Arena, Sugar Beach and the Distillery District. As shown in Figure 5-3, there is clear

opportunity to extend the eastern edge of this corridor through to the Eastern Waterfront with a

completely redeveloped and one-of-a-kind new mixed-use neighbourhood.

19 SOURCE: Euromonitor International. 2017 Top 100 City Destinations Ranking.





Figure 5-1: Map of Key Tourist Destinations Along Toronto’s Waterfront

SOURCE: urbanMetrics inc. For illustrative purposes only.

Baseline Tourism Statistics

As shown in Figure 5-2, approximately one third (28.3%) of visitation to “Tourism Region 5”20 is

motivated by “pleasure”. Furthermore, an additional 42.3% of all visits are driven by visiting friends

and relatives21, representing the single most significant reason that individuals visit the Region.

In our opinion, it is unlikely that visitors whose primary purpose is to see friends and family will induce

additional “net new” tourism visitation to Toronto as a result of the development of the Eastern

Waterfront. However, it is conceivable that a significant portion of visitors whose primary purpose is

pleasure, business, or business conventions, will ultimately extend their stays. Similarly, it is possible

that additional trips will be incurred as a direct result of personal or commercial travel related to new

attractions and opportunities in the Eastern Waterfront.

20 RTO 5 includes the cities of Toronto, Brampton and Mississauga. 21 2017 tourism data does not include information on visitors from the United States. However, urbanMetrics has compared 2017 travel patterns against previous years of data to confirm that general travel patterns (i.e. purpose of visit, length of stay) are relatively consistent.





Figure 5-2: Primary Purpose of Tourist Visits to RTO 5

SOURCE: Ontario Ministry of Tourism, Culture & Sport, 2017. “Pleasure” category includes Shopping and Conventions for

Personal Interest, plus “Business” category includes Conventions & Conferences for Commercial Purposes, and Other

Business.

Figure 5-3 summarizes the proportion of visitors to the Region by duration of stay. As shown, some

64.5% of total visitation is classified as same-day, whereas the remaining 35.5% of visitors to the

Region are overnight, with the majority spending between 1-3 nights in the area.

Figure 5-3: Visitors to RTO 5 by Length of Stay

SOURCE: Ontario Ministry of Tourism, Culture & Sport, 2017. Figures exclude visitation from the United States, however, the duration statistics shown above are consistent with previous MTC reports that included American data.





Building on the proportion of overnight and same-day visitors to Toronto, it is also important to

consider the relative difference in spending patterns among these two traveller groups. As shown in

Figure 5-4, daily expenditures for overnight visitors are nearly $60.00 more than for same day

travellers. Furthermore, accommodation costs represent an additional expenditure component that

ultimately is not made by same-day travellers.

Figure 5-4: Average Daily Expenditures by Visitation Type

SOURCE: urbanMetrics inc., based on Ontario Ministry of Tourism, Culture & Sport, 2017.

5.2 Assumptions urbanMetrics has incorporated the foregoing tourism information into a broader tourism expenditure

model that estimates the potential travel spending associated with increased visitation to the Eastern

Waterfront. These underlying visitation estimates have then been incorporated into the Government

of Ontario’s Tourism Regional Economic Impact Model (“TREIM”) to provide an understanding as to

the potential benefits that could accrue to the City of Toronto and more broadly throughout the

Province.

For the purposes of these high-level estimates, urbanMetrics has relied on several core assumptions

that underpin the general approach and more detailed findings presented herein. These assumptions

include:

• Tourism growth in Toronto and the broader GTA Region generally continues along the same or

similar trajectory as in recent years;





• The vision, master plan and unique innovations proposed by SWL, as understood by

urbanMetrics and articulated throughout this report, are realized and fully developed, as

proposed;

• Supporting infrastructure (e.g., higher order transit, waterfront pathways and pedestrian

connections, flood protection investments, etc.) are all developed according to publicly

available plans; and,

• Current development trends in neighbourhoods immediately adjacent to the Eastern

Waterfront continue in line with historical trends and known pipeline development activity.

Tourism Drivers

SWL’s proposed concept plan for the Eastern Waterfront will establish a unique, technologically

driven neighbourhood that is likely to attract tourists to the area and has the potential to function as

an eastern ‘anchor’ to the Toronto waterfront. The uniqueness of this neighbourhood, coupled with

the existing and proposed investments to be made throughout this area (e.g., Don River

naturalization, cultural space at the Hearn, the establishment of a new Urban Innovation Cluster,

etc.), promise to create a one-of-a-kind draw. In addition to drawing tourists who may already plan to

visit Toronto, it is highly likely that the Eastern Waterfront will also induce new trips to Toronto, and

encourage visitors to extend their stays (e.g., opting to spend extra time in Toronto specifically to see

the Eastern Waterfront).

Overall, based on the vision identified by SWL, it is our professional opinion that the following factors

will be the primary driving forces for increased tourism growth within the Eastern Waterfront in

coming years. For the purposes of this analysis, we have assumed that these attributes will induce

additional time spent in Toronto from various visitor market segments.

• Technology – The technologically driven approach to neighbourhood design in the Eastern

Waterfront will draw visitors for several purposes, including the novelty and interest in

understanding how the technological implementations may impact day-to-day experiences,

individuals interested for academic or commercial purposes, as well as other municipal

representatives considering implementing such innovations in their own jurisdictions.

• Urban Planning – The master-planned community will attract visitors interested in urban

planning, design and architecture, with visitation growth among students, practitioners and

casual onlookers. These visitors’ peaked interest will be driven by how SWL’s unique approach

to flexibility and design, as well as the integration of technology into the planning process

produces alternative outcomes and has the potential to influence liveability, accessibility and

transportation patterns.





• Education – Academics, working professionals and casual visitors from across North America

will be attracted to the Eastern Waterfront to learn about and understand the unique

innovations pioneered in Toronto. Toronto has the potential to become a “best practices” case

study for a range of applications that facilitates replication and spin-off innovations in other

communities.

• Culture & Nature – Visitors will be attracted to a renovated Hearn Generating Station, hosting

local and international talent in a unique and iconic space that is unique to Toronto.

Additionally, the SWL vision includes an emphasis on utilizing the natural features on the

subject lands; particularly Villiers Island and the associated re-naturalized Don River.

• Google Presence – The presence of the Google Canadian HQ—a globally recognized brand and

corporate entity—in a unique architectural environment will appeal to a certain segment of

the tourist population.

• Commerce – Google’s presence, as well as the location of a multitude of other technologically

oriented firms, academic researchers, and research institutions, is expected to increase

business visitation to Toronto significantly.

Timing

To establish a base year from which tourism impacts can be estimated, urbanMetrics has considered

the proposed buildout timeline of SWL’s vision for the Eastern Waterfront, in addition to the rate of

technological change expected, as well as other development occurring in Toronto. While the SWL

vision for the Eastern Waterfront is a novel, one-of-a-kind concept, we generally expect that—over

time—it will evolve into a mature neighbourhood that both fits in with and complements Toronto’s

existing urban fabric and communities. With this in mind, urbanMetrics has adopted 2035 as the base

year from which tourism impacts are to be tested, as it is our opinion that this point in time

potentially represents peak interest and visitation to the community. Our rationale for this is as

follows:

• Pre-2030: Introduction to Early Adopters – This period represents the initiation of tourism

visitation, once a significant portion of Phase 1 and 2 are forecast to be completed and fully

occupied (i.e., including Quayside and Keating West). Evaluating visitation at this date reflects

the initial interest and attraction to the SWL project. At this stage, it is anticipated that

visitation would primarily be driven by early adopters, including individuals that have a keen

interest in one or more aspects of the development project (e.g., urban planning, technology,

commercial or municipal purposes).

• 2030-2040: Peak Visitation – The entirety of Phase 1 and Phase 2 of the SWL vision are

scheduled to be completed and occupied by 2040. Accounting for potential construction





delays, occupancy and leasing timelines, this represents a reasonable timeline by which the

majority of the community has ultimately settled and established an identity both amongst

residents of Toronto and tourists to the area. At this period, it is anticipated that the area has

achieved its greatest prominence as a tourism destination and attracts the most significant

visitation from the widest range of visitor profiles. This is also when the area is expected to

receive more international tourism attention.

• Post-2040: Maturity – This represents the maturity of the Eastern Waterfront as a visitor

destination. By this period, SWL’s vision for the subject lands will largely represent a stable,

mature neighbourhood with significant local roots, engagement and attraction. It will have

evolved into one of Toronto’s iconic communities with a unique technological dynamic

underlying a more traditional inner-city Toronto community.

5.3 Visitor Spending Estimates Relying on the above assumptions and parameters for future tourism growth in the Eastern

Waterfront, the following summarizes the derivation of our visitor spending inputs.

As shown in Figure 5-5, we have estimated that SWL’s vision for the Eastern Waterfront will attract a

total of some 7.4 million annual tourists by 2035. This assumes Toronto tourism continues to grow at

a rate of approximately 3.0% per annum—consistent with recent and forecast expansion—and that

the Eastern Waterfront is able to ultimately capture one tenth of this total visitation. As illustrated in

Figure 5-6, this suggests that the Eastern Waterfront would attract a similar number of total visitors as

Vancouver’s Stanley Park or San Francisco’s Pier 39. Recognizing the unique approach that SWL has

proposed for the area, we believe that its reasonable to expect visitation to generally fall in-line with

these other Canadian and American destinations upon full build out and maturity of the

neighbourhood.

To then determine the associated visitor spending for these tourism estimates, we have applied the

average daily expenditure rates for both same-day and overnight visitors identified in Figure 5-4. We

have also assumed an average dwell time of some 3 hours (i.e., the equivalent of a single morning or

afternoon spent visiting the Eastern Waterfront). As shown in the figure below, this results in an

estimated total visitor spending of some $104 Million in 2035.





Figure 5-5: Visitation and Spending Forecasts for Eastern Waterfront

1 Based on an assumed 3.0% annual growth rate from 2017 baseline figures obtained from Tourism Toronto. Rounded to the nearest 1,000. 2 urbanMetrics inc. 3 urbanMetrics inc. Overnight and Same-Day visitation proportion is based on Ontario Ministry of Tourism, Culture & Sport, 2017. 4 urbanMetrics inc. Expenditure rates are based on Ontario Ministry of Tourism, Culture & Sport, 2017. 5 urbanMetrics inc. 6 urbanMetrics inc. Figures rounded to the nearest 1,000.

2035

Annual Toronto Visitation1 74,447,000

Proportion Allocated to SWL ("Market Capture")2 10.0%

Total Visitation to Port Lands3 7,444,700

Overnight Visitors 35.5% 2,643,864

Same-Day Visitors 64.5% 4,800,836

Total Expenditures4 $831,991,000

Overnight Visitors $149.36 $394,883,000

Same-Day Visitors $91.05 $437,108,000

Average Dwell Time (All Visitors)5 (hrs) 3

Average Dwell Time (All Visitors) (% of a day) 12.5%

Total Eastern Waterfront-Related Expenditures6 $103,999,000

Overnight Visitors $49,360,000

Same-Day Visitors $54,639,000





Figure 5-6: Tourism Visitation to Selected Attractions Across North America

SOURCE: urbanMetrics inc. For illustrative and general reference purposes only. Tourism figures have been derived from

individual tourism organizations. These figures are intended to provide a high-level estimation of tourism visitation to a

variety of attractions across North America. Methodologies and definitions may vary across each organization.





5.4 Visitor Spending Impacts For the purposes of understanding the economic impacts associated with the tourism expenditures

attributable to SWL in the Eastern Waterfront, the spending estimates shown in Figure 5-5 have been

used as inputs to the aforementioned TREIM model. The results of this analysis have been highlighted

in Figure 5-7.





Figure 5-7: Economic Impact Summary – Eastern Waterfront Tourism Spending






Appendix A Economic Impact Approach





The quantitative economic impacts of proposed investments in the Eastern Waterfront—including

those relating to one-time building construction and infrastructure construction, as well as ongoing

business operations and tourism activity—have been estimated using mathematical models, which

simulate the flow of expenditures through the economy. These models are designed to provide a

reliable measure of the impact of expenditures on job creation, incomes, value added to the

economy, as well as taxes and other government revenues.

As illustrated on the diagram to the right, the main steps in

running this type of economic impact model are: compiling the

input spending data; assembling the data to ensure all expenses

are accounted for and divided into appropriate categories to

ensure that the individual economic sectors are appropriately

represented; calibrating the model to the local economy using

employment data; testing against expected results; and running

the finalized version of the model.

The data assembly stage for this assignment involved allocating

each expenditure item to specific industry sectors using the

North American Industry Classification System (NAICS), as well

as the more detailed industry sub-categories identified in the

latest available Statistics Canada input-output economic impact

model. The allocation of expenditures by industry category

were based primarily on available financial information obtained

from Waterfront Toronto and SWL, as well as our own estimates

for local tourism activity. The data gathering stage also involved

several meetings and follow-up discussions with SWL’s financial

and technical staff to review expenditures and to confirm

assumptions made by urbanMetrics.

Economic Impact Model

With the exception of tourism related spending—which has been discussed in more detail herein—

the economic impacts of all planned investments and ongoing spending in the Eastern Waterfront

have been measured at the national, provincial and local levels, through the use of custom runs of the

Statistics Canada Interprovincial Input-Output model.

The main models considered in this study are based on the latest available Input-Output tables

produced by Statistics Canada for 2014, which illustrate the structure of the economy through the

depiction of transactions (sales and purchases) made among and between different industry sectors

of the economy.





National, Provincial and local impacts have been determined using expenditure data related to a

range of construction costs and other business activities, as outlined throughout the body of this

report. These expenditure data served as the key inputs to our economic impact reporting and have

been analyzed using the Statistics Canada Input-Output model in order to generate the following key

economic impacts:

• Gross Output;

• Value Added;

• Employment;

• Labour Income; and,

• Revenues to the Three Levels of Government.

The model also considers the direct impact of spending, as well as the indirect and induced impacts

that are spread more broadly across the Province and Canada.





Quantitative Estimation of Economic Impacts

Estimating economic impacts involves modelling the direct, indirect and induced impacts of an initial

“shock” investment or business activity on different spatial scales. Specifically, the type of modelling

used in this study involves the application of economic multipliers to measure the marginal impact of

initial expenditures on gross output (sales), value added to GDP, employment, labour income and

accrued taxes and tax credits going forward.

urbanMetrics inc. has utilized the Statistics Canada input-output economic impact model for this

research update, which is based on the Canadian National Input-Output Accounts. These accounts

can be used to estimate the total impact of expenditures, on an aggregate and industry-specific basis.

For the purposes of this study, the model has been calibrated to estimate economic impacts on the

Toronto economy, as well as at the Ontario and Canadian levels.

The basic principle of this type of model is the concept that each dollar of expenditure on goods

and/or services purchased from a given industry sector circulates and re-circulates within the

economy, thereby multiplying the effects of the original expenditure. As such, this process is referred

to as the multiplier effect. The estimated multipliers for all expenditures associated with SWL’s vision

for the Eastern Waterfront generally has three main components:

• Direct Impacts, which represent the initial operating and/or capital investments in the

waterfront. These expenditures include the purchase of labour, equipment, other

infrastructure and related services;

• Indirect effects, which represent the subsequent purchases by suppliers required to produce

the goods and services related to the original investments; and

• Induced Impacts, which result when workers employed in the sectors, stimulated by initial and

indirect expenditures, spend portions of their incomes on consumer goods and services.

Direct, indirect and induced impacts are estimated in terms of the following measures:

• Gross Output – a measure of total sales throughout the economy in question, as a result of an

initial expenditure on goods and/or services produced by an industry22.

22 For example, with respect to a construction project, an initial expenditure would be made to pay for the design firm and

contractor. The design team would then hire staff, purchase equipment and materials, such as computers, software,

paper, etc. The construction company would also hire labourers, pay for construction equipment and materials. The staff

in turn would purchase goods and services from their wages to support their everyday living. The sum of all of these

expenditures would be the gross output. This, however, is not the true impact on the economy, as it is involves double

counting (e.g., the initial expenditure, in reality covered wages and salaries, equipment, etc. of the contractors it hired).





• Value Added (Gross Domestic Product) – represents the net impact on the economy after

eliminating the double counting that can occur when calculating gross output and lead to the

calculation of inflated multipliers. This measure only considers final goods (gross sales less

cost of purchased inputs). At the local level “value added” is typically smaller, than the initial

expenditure, due to leakage23.

• Employment – total full-time, full-year jobs generated by direct, indirect and induced

expenditures. For one-time capital expenditures and other ongoing spending, such as those

being analyzed in this study, the employment figures produced by the model represent years

of full-time employment. For example, one job identified by the model represents the

equivalent of one person working full-time for the duration of one year.

• Labour Income – total value of wages, salaries and benefits received by employees associated

with direct, indirect and induced expenditure.

• Government Revenues – revenues accruing to federal, provincial and local jurisdictions as a

result of direct, indirect and induced expenditures. Revenue categories include personal and

corporate income tax, sales taxes (e.g. PST and GST), property taxes and other miscellaneous

taxes, tariffs and fees.

• Multipliers are expressed by the ratio of total impacts (direct, indirect and induced) to the

direct expenditure component for each variable identified. This is the same for all outputs

expressed in dollars as well as that of the employment multiplier in order to preserve common

units24.

Localized Impacts

In Canada, Statistics Canada calculates input-output accounts at the national, provincial levels only.

The economic impacts for the City of Toronto were calculated by applying “location quotients” to the

economic impact results generated for the Province of Ontario. Location quotients represent the

share of employment in each industry sector relative to the Province as a whole. This is the most

23 For example, a firm building a project in one jurisdiction may purchase equipment and supplies from another.

Furthermore, design and construction employees may live outside of the jurisdiction in which the project is being built and

thus spend their wages in other closer to their homes. 24 For example, the gross output multiplier on a $10 million construction project can be thought of in the following manor.

Some $2 million of the budget was paid to the design firm for staff wages, equipment and materials. Some $5 million was

paid to the construction firm for wages, materials and equipment. Subsequently, design and construction employees paid

$1 million from their wages for food, entertainment, and other living expenses. The gross output would be $10 + $5 + $2 +

$1 million, or $17 million, or a gross output multiplier of 1.7.





common and accepted methodology for determining localized impacts when industry and commodity

data is not available.

The logic to using location quotients to estimate localized impacts is that the relative share of

employment within a given industry should be similar to the share of a purchase within that industry

that could be sourced locally. The principal issue with this approach is that when it is applied to a

municipality within a much larger urban area, there is the potential for significant cross purchasing

between municipalities, regardless of the employment composition. With regards to the custom

models used for this study, even at the City level, this would be limited due to the overall size of

Toronto.

Tourism Impacts

As noted above, the economic impacts of tourism spending in the Eastern Waterfront have been

determined through a similar, albeit separate and distinct input-output model. This model is

equivalent to the one used for the various other components of our main economic impact analysis

(i.e., for capital construction investments, infrastructure, operating output, etc.), though it has been

specifically calibrated to reflect the impacts of tourism activities. It is maintained by the Government

of Ontario’s Ministry of Tourism, Culture & Sport.

Similar to the main economic impact modelling outlined above, the Tourism Regional Economic

Impact Model (“TREIM”)—has been run to measure direct, indirect and induced impacts at various

geographies across the Province of Ontario, including: job creation (person years); labour incomes,

gross output, and government/tax revenues.





Appendix B Economic Impact Summary Tables





Figure B-1: Economic Impact Summary – Baseline Building Construction (Total)

Baseline Scenario – Building Construction Total Phase 1 + Phase 2

SOURCE: urbanMetrics inc., based on a custom run of the Statistics Canada Interprovincial Input-Output model.

TORONTO ONTARIO CANADA

Initial Expenditure 12,132,121,707$ 12,132,121,707$ 12,132,121,707$

Impact: Gross Output

Direct 12,132,121,707$ 12,132,121,707$ 12,132,121,707$

Indirect 4,489,509,971$ 6,640,993,003$ 8,348,564,756$

Induced 2,694,743,349$ 3,916,814,704$ 4,949,686,707$

Total 19,316,375,027$ 22,689,929,415$ 25,430,373,171$

Multiplier 1.59 1.87 2.10

Impact: Value Added

Direct 4,879,912,866$ 4,879,912,866$ 4,879,912,866$

Indirect 2,429,181,931$ 3,388,328,677$ 4,183,603,685$

Induced 1,493,269,635$ 2,300,069,238$ 2,844,025,057$

Total 8,802,364,432$ 10,568,310,780$ 11,907,541,608$


Impact: Employment (Full-Time, Full-Year Employment)

Direct 37,551 37,551 37,551

Indirect 19,900 28,589 34,474

Induced 12,575 15,689 19,327

Total 70,026 81,829 91,351


Impact: Labour Income

Direct 3,365,369,274$ 3,365,369,274$ 3,365,369,274$

Indirect 1,580,831,101$ 2,268,022,697$ 2,736,764,613$

Induced 867,069,680$ 1,075,869,158$ 1,338,598,055$

Total 5,813,270,055$ 6,709,261,129$ 7,440,731,941$

Impact: Total Taxes

Federal 1,247,438,666$ 1,503,354,129$ 1,675,238,194$

Provincial 1,220,728,775$ 1,542,797,387$ 1,670,862,273$

Local 1,098,051,177$ 1,488,612,750$ 1,501,516,025$

Total 3,566,218,618$ 4,534,764,266$ 4,847,616,492$





Figure B-2: Economic Impact Summary – Baseline Infrastructure (Phase 1)

Baseline Scenario – Building Construction Phase 1





Direct 1,529,780,062$ 1,529,780,062$ 1,529,780,062$

Indirect 563,440,787$ 843,293,668$ 1,071,297,939$

Induced 329,020,491$ 478,121,865$ 607,170,766$

Total 2,422,241,340$ 2,851,195,596$ 3,208,248,767$


Impact: Value Added

Direct 605,465,260$ 605,465,260$ 605,465,260$

Indirect 302,570,438$ 426,954,334$ 532,014,665$

Induced 182,305,143$ 280,721,206$ 348,895,518$

Total 1,090,340,842$ 1,313,140,800$ 1,486,375,444$



Direct 4,509 4,509 4,509

Indirect 2,492 3,616 4,400

Induced 1,535 1,915 2,371

Total 8,535 10,040 11,280



Direct 400,306,689$ 400,306,689$ 400,306,689$

Indirect 197,079,078$ 285,673,253$ 347,815,112$

Induced 105,849,429$ 131,332,089$ 164,198,347$

Total 703,235,196$ 817,312,031$ 912,320,148$

Impact: Total Taxes

Federal 151,826,152$ 184,673,988$ 206,536,058$

Provincial 152,439,513$ 194,405,898$ 209,966,246$

Local 145,887,609$ 199,084,564$ 200,108,714$

Total 450,153,275$ 578,164,449$ 616,611,019$





Figure B-3: Economic Impact Summary – Baseline Construction (2040)

Baseline Scenario – Building Construction 2040 - Quayside, Keating West, & Villiers Island





Direct 6,079,440,598$ 6,079,440,598$ 6,079,440,598$

Indirect 2,241,623,265$ 3,343,649,894$ 4,234,897,567$

Induced 1,319,954,955$ 1,918,248,892$ 2,432,422,033$

Total 9,641,018,818$ 11,341,339,384$ 12,746,760,198$


Impact: Value Added

Direct 2,418,292,994$ 2,418,292,994$ 2,418,292,994$

Indirect 1,206,413,478$ 1,696,647,226$ 2,108,525,937$

Induced 731,389,161$ 1,126,322,995$ 1,397,702,229$

Total 4,356,095,633$ 5,241,263,215$ 5,924,521,160$



Direct 18,180 18,180 18,180

Indirect 9,921 14,356 17,422

Induced 6,159 7,683 9,499

Total 34,260 40,219 45,101



Direct 1,618,854,597$ 1,618,854,597$ 1,618,854,597$

Indirect 785,560,470$ 1,135,328,080$ 1,378,718,186$

Induced 424,664,209$ 526,908,853$ 657,811,415$

Total 2,829,079,275$ 3,281,091,530$ 3,655,384,198$

Impact: Total Taxes

Federal 609,678,901$ 739,534,878$ 826,177,454$

Provincial 607,598,468$ 772,812,613$ 835,309,828$

Local 571,496,868$ 778,427,109$ 783,189,454$

Total 1,788,774,238$ 2,290,774,600$ 2,444,676,736$





Figure B-4: Economic Impact Summary – Baseline Infrastructure (Phase 1 + Phase 2)

Baseline Scenario – Infrastructure Phase 1 + 2





Direct 2,984,768,479$ 2,984,768,479$ 2,984,768,479$

Indirect 1,179,007,450$ 1,717,823,732$ 2,106,156,788$

Induced 661,032,229$ 957,680,377$ 1,202,809,087$

Total 4,824,808,158$ 5,660,272,588$ 6,293,734,354$


Impact: Value Added

Direct 1,153,403,697$ 1,153,403,697$ 1,153,403,697$

Indirect 626,332,594$ 857,969,189$ 1,053,077,537$

Induced 366,478,897$ 562,605,585$ 691,159,070$

Total 2,146,215,189$ 2,573,978,472$ 2,897,640,304$



Direct 10,172 10,172 10,172

Indirect 4,740 6,550 7,710

Induced 3,095 3,822 4,675

Total 18,007 20,543 22,557



Direct 874,081,189$ 874,081,189$ 874,081,189$

Indirect 401,457,417$ 553,909,548$ 653,903,296$

Induced 214,023,439$ 262,731,728$ 324,889,861$

Total 1,489,562,045$ 1,690,722,465$ 1,852,874,346$

Impact: Total Taxes

Federal 326,237,156$ 386,422,179$ 429,261,653$

Provincial 272,690,342$ 336,865,770$ 372,722,573$

Local 70,787,529$ 95,166,665$ 101,581,971$

Total 669,715,027$ 818,454,614$ 903,566,196$





Figure B-5: Economic Impact Summary – Baseline Infrastructure (2040)

Baseline Scenario – Infrastructure 2040 - Quayside, Keating West, & Villiers Island





Direct 1,588,908,602$ 1,588,908,602$ 1,588,908,602$

Indirect 644,203,951$ 937,378,299$ 1,145,886,437$

Induced 355,167,667$ 514,560,617$ 645,922,191$

Total 2,588,280,220$ 3,040,847,517$ 3,380,717,230$


Impact: Value Added

Direct 613,444,275$ 613,444,275$ 613,444,275$

Indirect 340,407,345$ 466,252,315$ 571,588,492$

Induced 196,907,642$ 302,291,388$ 371,152,682$

Total 1,150,759,262$ 1,381,987,978$ 1,556,185,449$



Direct 5,447 5,447 5,447

Indirect 2,572 3,540 4,156

Induced 1,663 2,053 2,510

Total 9,682 11,040 12,114



Direct 472,312,245$ 472,312,245$ 472,312,245$

Indirect 217,111,310$ 298,231,524$ 351,466,370$

Induced 115,001,440$ 141,164,934$ 174,469,254$

Total 804,424,995$ 911,708,703$ 998,247,870$

Impact: Total Taxes

Federal 174,974,706$ 207,644,674$ 230,204,849$

Provincial 146,360,976$ 180,872,885$ 198,983,427$

Local 38,553,914$ 51,919,387$ 54,624,171$

Total 359,889,596$ 440,436,946$ 483,812,448$





Figure B-6: Economic Impact Summary – Baseline Operating Output (Phase 1 + Phase 2)

Baseline Scenario – Operating Output Phase 1 + Phase 2





Direct 5,023,794,380$ 5,023,794,333$ 5,023,794,333$

Indirect 1,655,369,613$ 2,318,675,236$ 2,895,928,433$

Induced 1,014,421,406$ 1,469,624,334$ 1,846,808,423$

Total 7,693,585,399$ 8,812,093,903$ 9,766,531,189$


Impact: Value Added

Direct 2,597,721,029$ 2,597,721,029$ 2,597,721,029$

Indirect 1,059,514,739$ 1,230,751,156$ 1,527,789,952$

Induced 562,395,634$ 863,340,633$ 1,061,219,730$

Total 4,219,631,402$ 4,691,812,818$ 5,186,730,711$



Direct 18,128 18,128 18,128

Indirect 7,737 9,054 10,894

Induced 4,749 5,864 7,179

Total 30,614 33,047 36,202



Direct 1,469,736,128$ 1,469,736,128$ 1,469,736,128$

Indirect 629,491,193$ 733,321,573$ 889,720,633$

Induced 328,405,920$ 403,183,796$ 498,814,929$

Total 2,427,633,241$ 2,606,241,497$ 2,858,271,690$

Impact: Total Taxes

Federal 588,528,446$ 657,696,751$ 725,226,441$

Provincial 489,545,759$ 565,428,278$ 624,729,788$

Local 150,631,704$ 184,670,580$ 197,616,397$

Total 1,228,705,909$ 1,407,795,609$ 1,547,572,627$





Figure B-7: Economic Impact Summary – Baseline Operating Output (2040)

Baseline Scenario – Operating Output 2040 - Quayside, Keating West, & Villiers Island

SOURCE: urbanMetrics inc., based on a custom run of the Statistics Canada Interprovincial Input-Output model. NOTE – Most of the “operating output” impacts referenced throughout this report have been expressed on an annual basis and therefore consider the

full build-out of the Eastern Waterfront under each scenario. This table, however, summarizes the impacts that could be generated in 2040 only, based

on the level of development achieved at this time. It also assumes that the composition of the local employment base in this area will be equivalent to

that modelled for the full build-out of the Eastern Waterfront under the Baseline scenario (i.e., consistent with the summary table in Figure B-6 above).




Direct 2,052,217,878$ 2,052,217,859$ 2,052,217,859$

Indirect 676,217,787$ 947,177,853$ 1,182,985,539$

Induced 414,390,715$ 600,340,919$ 754,420,459$

Total 3,142,826,380$ 3,599,736,630$ 3,989,623,857$


Impact: Value Added

Direct 1,061,167,941$ 1,061,167,941$ 1,061,167,941$

Indirect 432,811,322$ 502,761,326$ 624,101,549$

Induced 229,738,378$ 352,674,283$ 433,507,811$

Total 1,723,717,642$ 1,916,603,551$ 2,118,777,301$



Direct 7,405 7,405 7,405

Indirect 3,161 3,699 4,450

Induced 1,940 2,396 2,933

Total 12,506 13,500 14,788



Direct 600,386,586$ 600,386,586$ 600,386,586$

Indirect 257,146,886$ 299,561,552$ 363,450,502$

Induced 134,153,679$ 164,700,410$ 203,765,687$

Total 991,687,151$ 1,064,648,548$ 1,167,602,776$

Impact: Total Taxes

Federal 240,413,621$ 268,668,844$ 296,254,694$

Provincial 199,979,235$ 230,977,212$ 255,201,854$

Local 61,532,987$ 75,437,854$ 80,726,215$

Total 501,925,844$ 575,083,911$ 632,182,763$





Figure B-8: Economic Impact Summary – SWL Vision Building Construction (Phase 1 + Phase 2)

Sidewalk Labs Vision – Building Construction Phase 1 + Phase 2





Direct 17,924,666,082$ 17,924,666,082$ 17,924,666,082$

Indirect 6,493,072,456$ 9,727,541,474$ 12,527,754,113$

Induced 3,977,810,700$ 5,780,418,490$ 7,350,466,624$

Total 28,395,549,239$ 33,432,626,046$ 37,802,886,820$


Impact: Value Added

Direct 7,040,437,678$ 7,040,437,678$ 7,040,437,678$

Indirect 3,562,482,362$ 5,026,280,562$ 6,314,597,954$

Induced 2,203,986,991$ 3,393,753,304$ 4,224,197,530$

Total 12,806,907,031$ 15,460,471,543$ 17,579,233,162$



Direct 55,224 55,224 55,224

Indirect 29,170 42,413 52,004

Induced 18,557 23,150 28,700

Total 102,950 120,787 135,928



Direct 4,927,114,947$ 4,927,114,947$ 4,927,114,947$

Indirect 2,322,251,389$ 3,369,639,892$ 4,132,897,206$

Induced 1,279,640,053$ 1,587,841,066$ 1,987,624,074$

Total 8,529,006,390$ 9,884,595,905$ 11,047,636,227$

Impact: Total Taxes

Federal 1,872,339,163$ 2,250,011,317$ 2,488,618,950$

Provincial 1,761,118,062$ 2,238,391,973$ 2,456,734,673$

Local 1,505,318,562$ 2,067,972,082$ 2,118,923,603$

Total 5,138,775,787$ 6,556,375,371$ 7,064,277,226$





Figure B-9: Economic Impact Summary – SWL Vision Building Construction (Phase 1)

Sidewalk Labs Vision – Building Construction Phase 1





Direct 1,613,213,865$ 1,613,213,865$ 1,613,213,865$

Indirect 599,249,924$ 890,703,195$ 1,139,906,900$

Induced 364,868,434$ 530,232,553$ 673,336,190$

Total 2,577,332,223$ 3,034,149,613$ 3,426,456,955$


Impact: Value Added

Direct 622,185,212$ 622,185,212$ 622,185,212$

Indirect 330,265,857$ 462,330,965$ 578,155,113$

Induced 202,170,197$ 311,322,482$ 386,961,314$

Total 1,154,621,266$ 1,395,838,659$ 1,587,301,638$



Direct 5,065 5,065 5,065

Indirect 2,681 3,866 4,718

Induced 1,702 2,124 2,629

Total 9,449 11,055 12,412



Direct 451,720,281$ 451,720,281$ 451,720,281$

Indirect 215,876,135$ 310,558,961$ 378,839,410$

Induced 117,389,790$ 145,649,507$ 182,070,571$

Total 784,986,206$ 907,928,749$ 1,012,630,262$

Impact: Total Taxes

Federal 172,079,221$ 206,234,304$ 227,542,459$

Provincial 157,961,737$ 200,176,620$ 220,115,171$

Local 124,179,383$ 170,653,045$ 175,557,635$

Total 454,220,341$ 577,063,970$ 623,215,265$





Figure B-10: Economic Impact Summary – SWL Vision Infrastructure (Phase 1 + Phase 2)

Sidewalk Labs Vision – Infrastructure Phase 1 + Phase 2





Direct 5,129,819,445$ 5,129,819,445$ 5,129,819,445$

Indirect 1,889,406,860$ 2,772,013,034$ 3,403,022,699$

Induced 1,116,403,997$ 1,617,505,501$ 2,027,840,993$

Total 8,135,630,302$ 9,519,337,980$ 10,560,683,137$


Impact: Value Added

Direct 2,148,543,316$ 2,148,543,316$ 2,148,543,316$

Indirect 1,005,197,777$ 1,383,667,404$ 1,699,309,543$

Induced 618,964,731$ 950,290,157$ 1,165,203,566$

Total 3,772,705,824$ 4,482,500,877$ 5,013,056,425$



Direct 17,663 17,663 17,663

Indirect 7,626 10,636 12,527

Induced 5,227 6,455 7,882

Total 30,515 34,754 38,072



Direct 1,485,967,103$ 1,485,967,103$ 1,485,967,103$

Indirect 647,888,920$ 902,603,039$ 1,065,668,067$

Induced 361,481,214$ 443,742,010$ 547,745,775$

Total 2,495,337,237$ 2,832,312,153$ 3,099,380,945$

Impact: Total Taxes

Federal 564,998,092$ 666,997,646$ 737,621,168$

Provincial 467,167,516$ 572,701,532$ 632,405,883$

Local 115,573,709$ 153,026,460$ 164,104,658$

Total 1,147,739,317$ 1,392,725,638$ 1,534,131,709$





Figure B-11: Economic Impact Summary – SWL Vision Operating Output (Phase 1 + Phase 2)

Sidewalk Labs Vision – Operating Output Phase 1 + Phase 2





Direct 13,237,067,487$ 13,237,067,637$ 13,237,067,637$

Indirect 4,491,559,734$ 6,030,024,749$ 7,368,953,681$

Induced 2,820,166,455$ 4,086,370,051$ 5,108,946,559$

Total 20,548,793,676$ 23,353,462,437$ 25,714,967,877$


Impact: Value Added

Direct 7,264,164,057$ 7,264,164,057$ 7,264,164,057$

Indirect 2,941,588,492$ 3,303,117,749$ 4,006,718,951$

Induced 1,563,678,466$ 2,400,976,522$ 2,935,430,663$

Total 11,769,431,016$ 12,968,258,328$ 14,206,313,671$



Direct 46,419 46,419 46,419

Indirect 21,819 24,662 29,274

Induced 13,206 16,308 19,860

Total 81,443 87,388 95,552



Direct 4,157,879,855$ 4,157,879,855$ 4,157,879,855$

Indirect 1,788,827,347$ 2,015,498,753$ 2,406,484,850$

Induced 913,169,757$ 1,121,019,875$ 1,379,980,574$

Total 6,859,876,959$ 7,294,398,482$ 7,944,345,278$

Impact: Total Taxes

Federal 1,646,036,249$ 1,821,305,967$ 1,992,545,329$

Provincial 1,387,745,602$ 1,584,043,496$ 1,733,979,127$

Local 466,334,697$ 561,675,703$ 594,512,166$

Total 3,500,116,547$ 3,967,025,167$ 4,321,036,622$





Figure B-12: Economic Impact Summary – SWL Vision Tourism (Same-Day Expenditures)

Sidewalk Labs Vision – Tourism Eastern Waterfront

SOURCE: urbanMetrics inc., based on a custom run of the Government of Ontario’s Tourism Regional Economic Impact

Model (“TREIM”).





Figure B-13: Economic Impact Summary – SWL Vision Tourism (Overnight Expenditures)

Sidewalk Labs Vision – Tourism Eastern Waterfront

SOURCE: urbanMetrics inc., based on a custom run of the Government of Ontario’s Tourism Regional Economic Impact

Model (“TREIM”).





Appendix C urbanMetrics Profile





Firm Profile urbanMetrics is one of Canada’s oldest and most respected real estate market and urban economic

consulting firms. Our team consistently delivers expert advice to clients—large and small, public and

private—who want to put their resources to better use. We provide custom analytics and practical

solutions that are designed to help our clients negotiate change and manage risk.

We are a results-oriented advisory firm focused on:

• Location-Based Market Research & Analysis;

• Economic & Fiscal Impact Analysis;

• Concept Scoping & Refinement;

• Strategy & Public Policy;

• Stakeholder Engagement; and,

• Expert Testimony & Dispute Resolution (OMB/LPAT)

Our clients benefit from our diverse range of backgrounds including: real estate market analysts; land

economists; Geographic Information System analysts; urban geographers; and urban planners. This

combination of skills enables us to work collaboratively to offer our clients an innovative and

comprehensive approach to each assignment.

Corporate History

Through its long history, urbanMetrics (and its predecessor firms) has established itself as a leading

consulting practice, providing a range of market, economic and strategic advice to the real estate

development and urban planning industries. Our firm was originally founded in 1947 as Larry Smith &

Company; the premier real estate consulting firm in Canada and the United States. The Canadian

practices of Larry Smith and Canadian Urban Economics Ltd. were acquired by Coopers & Lybrand

(“C&L”) in 1974 and through the merger with Price Waterhouse in 1998 became the

PricewaterhouseCoopers LLP Real Estate Advisory Services practice.

In 2004, urbanMetrics was launched as a wholly independent consulting firm with senior staff from

the former PricewaterhouseCoopers Real Estate Advisory Services practice. The original Partners of

the firm have long standing experience and strong linkages with all our legacy firms.





Clients

Our experts offer advisory services across all sectors of the real estate market, including to municipal,

provincial and federal government agencies, major property managers, public and private developers,

retailers, as well as institutional owners of real estate.

Our firm also maintains close working ties with professionals across the full spectrum of the municipal

development and real estate development/management industries. We collaborate with planners,

designers, politicians, engineers, lawyers, retailers, educators, economic development officers, real

estate developers and institutional investors.

Qualifications & Experience urbanMetrics regularly advises major public agencies and private sector organizations on the

economic impacts of major capital investments, key policy changes and on-going business activities,

including tourism. Our methodologies rely on established practices that have been accepted and

regularly peer reviewed by government decision makers.

In addition to this expertise, our firm also continues to be involved in virtually all of the single largest

and most high-profile development projects throughout the City of Toronto and across the Greater

Toronto Area, providing our team with an intimate familiarity with the unique opportunities and

challenges faced by new development in the Eastern Waterfront. In particular, we have worked





closely with Waterfront Toronto for more than a decade, articulating the various economic impacts of

major investments in the revitalization of the Toronto waterfront, as well as in determining the

related spin-off benefits of new public and private development activity in the area. Similarly, we

have completed a range of work on behalf of local developers and major property owners active in

this particular submarket of Toronto, as well as a diverse collection of public sector clients and

government agencies directly involved in shaping the future of this community.

The following highlights a selection of our recent project experience in this regard:

• Waterfront Toronto – Multiple Economic Impact Analyses

• Infrastructure Ontario – West Don Lands/Pan Am Athlete’s Village Economic Impact Analysis

• First Gulf – East Harbour (Former Uniliver/Lever Brothers) Office Market Demand Analysis

• Airbnb – Economic Impact Analysis

• QuadReal Property Group – Commerce Court Office Complex Expansion

• CreateTO (formerly Build Toronto) – Multiple Economic, Social and Fiscal Impact Analyses

• DiamondCorp – The Well (Former Globe & Mail) Retail Market Analysis

• Oxford Properties – Metro Toronto Convention Centre Redevelopment

• Oxford Properties – Yorkdale Shopping Centre Economic Impact Analysis

• Westbank – Honest Ed’s Retail Market Demand & Impact Analysis

• Canada Lands Company (CLC) – Downsview Park Market & Economic Advisory Services

• Niagara Parks Commission – Economic Advisory Services

• City of Brampton – University Economic Impact Statement, New Campus Proposal

• YMCA of Greater Toronto – Economic Impact Analysis of Expansion Program

• Burl’s Creek Event Grounds Inc. – WayHome and Boots & Hearts Music & Arts Festivals

Economic Impact Analysis

• University of Manitoba – Regional Economic Impact Analysis

• McMaster University – Burlington Waterfront Campus Economic Benefits Assessment

• University of Ottawa – Regional Economic Impact Analysis