The East Harbour Site in Toronto: A Case Study in the Unholy Trinity of Politicians, Big Developers and Big Unions

Covid is destroying huge swaths of local economies and communities — but it’s far from stemming the flow of funds to the most powerful
Rosemary Frei, MSc
April 22, 2021

On April 12 the province of Ontario announced that a site in Toronto called East Harbour will be one of the first two subway-related transit-oriented communities created in Ontario.

 

That means the province likely will pour millions more dollars into the hands of developers, to build housing and amenities on the ‘East Harbour Transit Hub’ and on the other site, Corktown Station. This is despite the fact that public-transit ridership likely will remain far below normal levels for the foreseeable future.

 

East Harbour is a case study in how very powerful developers’ plans and profits are moving forward fast under Covid — with governments directly aiding and abetting this by contributing billions of taxpayers’ dollars and fast-tracking the projects. Two of the key players are Toronto Mayor John Tory and developer David Gerofsky. In addition, big unions are benefiting handsomely.

 

East Harbour is a part of a 60-acre parcel of land called the Unilever Precinct. It lies on the east bank of the Don River. Most of the site is private land but some is city-owned. The location is just three kilometres east of Toronto’s downtown core and a much shorter distance north of Lake Ontario’s north shore.

 

In February 2012 most of the site was purchased by First Gulf. First Gulf is a large Toronto-headquartered development firm that includes Great Gulf Homes. It was led until August 2020 by Gerofsky. (He now appears to have his own developing company. Gerofsky is lobbying the City of Toronto for favourable changes to his properties, some of which were formerly owned by First Gulf.)

 

In September 2019 First Gulf sold the property to another big developer, Cadillac Fairview. Cadillac Fairview is headquartered in Toronto and is wholly owned by the Ontario Teachers’ Pension Plan. (This pension plan is for approximately 400,000 current and former primary-school and secondary-school unionized teachers in Ontario.)

 

From 2016 to 2018 I watched first-hand as Gerofsky stick-handled through city hall — at record speed and with extremely little opposition — the rezoning of East Harbour from industrial to employment. Gerofsky framed the rezoning purely as benefiting the residents of Toronto. The rezoning significantly increased the land’s value.

 

Also adding tremendously to the land’s value are plans that are well underway for four major transit projects that will create a transit hub at East Harbour.

 

In addition, another two major infrastructure projects in the immediate vicinity that are roaring toward completion are juicing the land owner’s return on investment. These are the $2-billion-plus ‘hybrid’ approach to revamping the aged Gardiner expressway and the approximately $1.25-billion-plus Port Lands Flood Protection project. They both directly increase the value of East Harbour. (More on these below.)

 

SmartTrack and the Ontario Line subway route are two of those four major transit projects. Each will have a station at East Harbour. (The 15-stop Ontario Line also has another station a short distance northeast of East Harbour, at Leslieville, and one in Corktown about 1.25 kilometre west of East Harbour.)

 

The majority of the projected $11-billion cost of the Ontario Line is being funded by the Ontario government. This is part of the Doug Ford Progressive Conservative government’s push to continue to build increasingly expensive transit lines – despite public-transit ridership plummeting in the era of Covid.

 

The other two major transit projects that involve the East Harbour site are increased GO Train service and a future Toronto Transit Commission streetcar extension to East Harbour. (However, the siting of an Ontario Line station at East Harbour together with the other transit projects causes considerable design/alignment/construction challenges, as documented for example by transit expert Steve Munro.)

 

SmartTrack was marketed as a 22-stop, 53-kilometre route to efficiently shuttle Toronto transit passengers 24/7 through congested areas, via provincial GO Rail lines. It was the centrepiece of Tory’s first successful Toronto mayoral campaign, in 2014. It also was part of his ‘transit network plan’ pitch to voters.

 

SmartTrack was first officially proposed by lobbyist and Liberal Party loyalist John Duffy. He’s the founder and Principal of PR/lobbying company StrategyCorp. Duffy also was a volunteer senior strategist for Tory’s 2014 mayoral campaign.

 

Duffy has lobbied the Toronto, Ontario and federal governments extensively on behalf of First Gulf to push SmartTrack and also the expensive ‘hybrid’ plan for revamping Gardiner expressway. (The Gardiner hybrid approach was first suggested by Gerofsky; more on this below.)

 

In 2015 Duffy even planned an astroturf group – a ‘non-partisan advocacy’ ensemble dubbed Friends & Allies of SmartTrack (FAST). (This petered out, well, fast.)

 

Other StrategyCorp high-ups also lobbied the city, province and federal governments on behalf of First Gulf for SmartTrack, the Gardiner hybrid plan and the Port Lands Flood Protection project. They include Stephen Adler, Andrew Steele and Brian Teefy.

 

Gerofsky did a lot of lobbying tooHe also contributed the maximum allowable amount for an individual, $2,500, to Tory’s 2014 mayoral election campaign (go to http://app.toronto.ca/EFD/jsf/candidate/view_financial_statements.xhtml?campaign=9, click ‘T’ and scroll down to ‘Tory, John’ and click on the hyperlinked ‘1’ to access the PDF of Tory’s donations). Gerofsky did this again for Tory’s 2018 campaign (go to http://app.toronto.ca/EFD/jsf/candidate/view_financial_statements.xhtml and click ‘T,’ then scroll down to ‘Tory, John’ and click on the hyperlinked ‘1’).

 

The number of SmartTrack stations has plummeted: it’s gone from the original Tory/Duffy promise of 22 to just five today. East Harbour is one of those five surviving stations.

 

In February 2021 the City of Toronto, with a contribution from the federal government, confirmed it would pay approximately $1.5 billion for the SmartTrack stations including the one at East Harbour. This was first approved by city hall’s Executive Committee — which is chaired by Tory and dominated by his allies — on January 13, 2021, and then by full council at the February 2-3, 2021, meeting.

 

The cards were stacked in favour of First Gulf long before that. At a March 1, 2018, SmartTrack public-consultation meeting that I went to, a representative of the provincial transit agency, Metrolinx, said First Gulf would pay for most of the East Harbour station’s costs. (Gerofsky reiterated this in his on-stage chat with Tory at the June 2018 Land & Development conference.) But then at a SmartTrack public consult on March 21, 2018, City of Toronto Transit and Transportation Planning director James Perttula told me the city would pay the basic-station costs and First Gulf would only have to pay for the ‘extras.’

 

At that June 2018 Toronto Land & Development Conference, Tory and Gerofsky were featured in a joint keynote conversation (they’re pictured above, in a screengrab from a video of their talk). The pair extolled the municipal government’s paving the way for developers to make money.

 

For example Tory said to Gerofsky, “I’m a strong free-enterpriser – I came from a business background – I understand that it is not only desirable for people to make money so they can go on to the next project. But it’s also necessary for us [government] to make sure we build the infrastructure, and don’t build it 25 years later but build it now … so that everybody can live in the city and work for your companies, and that we have to do that in partnership with each other.”

 

As mentioned above, there are two other major infrastructure projects that directly add to the market value of East Harbour and neighbouring land.

 

One is Waterfront Toronto’s multi-billion-dollar Port Lands Flood Protection project. It’s designed to protect a large swath of land from flooding from the Don River. The East Harbour area is marked by the letter ‘H’ in this map of the flood-protection project. (Oddly, the project was not designed to protect any of this land from rising lake levels, despite significant flooding from the lake as recently as 2017 and 2019.)

 

The other mega-project in the area is the revamping of the 19-kilometre-long, approximately 60-year-old, Gardiner Expressway. The east end of the Gardiner runs along the south side of the East Harbour site.

 

The controversial $2-billion-plus approach that’s being used to deal with the crumbling inter-city highway is known as the ‘hybrid option.’ It was first proposed by Gerofsky in 2014. This option involves rehabilitating most of the downtown portion of the elevated roadway and removing the portion of the Gardiner near East Harbour. Taking down the eastern portion of the elevated expressway creates much easier access to East Harbour.

 

(The Gardiner used to continue east from there, but that portion was removed in 2000-2001.)

 

In the build-up to the June 2015 city-council vote on what to do with the Gardiner, Tory and his staff strongly pushed the hybrid project.

 

StrategyCorp also added its heft to the full-court-press hybrid-option campaign. Among its staffers working the phones and corridors of power was Courtney Glen. She’d been the deputy head of communications for Tory’s 2014 transition to power after winning the election. (And following her stints at StrategyCorp, Edelman PR and Teneo Holdings, Glen returned to Tory’s team — this time as his deputy chief of staff — in December 2018. She’s still in that post.)

   

First Gulf also commissioned a May 2015 poll about the Gardiner. The poll results indicated that most Toronto residents favour the hybrid option. A few select city councillors were shown the poll. Then it was published in the Toronto Sun just before the city-council vote on the hybrid plan for the Gardiner.

 

(The Sun article was written by Don Peat, who in December 2016 became Director of Communications for Tory. In December 2018 Peat’s title changed to Executive Director of Communications and Strategic Issues Management for Tory. Peat remains in the position today.)

 

In addition, a group called the Coalition in Support of the East Gardiner Hybrid Renewal “aggressively promoted the hybrid option,” according to a June 2015 Toronto Star article.

 

And then a respected Toronto-based planner and architect named John van Nostrand popped up in June 2015 to help push the plan into the end zone. There are strong indications that van Nostrand’s appearance was coordinated by Tory, his staff and StrategyCorp.

 

The hybrid plan was narrowly accepted by city council, in a vote of 24-21, on June 11, 2015Subsequent changes to it were approved by council in 2016. (And in February 2021 Globe and Mail columnist Alex Bozikovic suggested a further tweak that would enable the development of even more of the land in the area east of the Don River.)

   

Who benefits? Taxpayers aren’t exactly getting good value for money. And the vast majority of people who use Toronto’s transit, streets and expressways aren’t benefiting much either.

 

The hybrid option will only save a few minutes’ driving time for a small minority of people who use the Gardiner. Almost all objective experts agree that the logistically superior — and $500-million-plus less-expensive – choice is to tear the whole Gardiner down.

 

The winners include big landowners and developers in the area where the Gardiner will be torn down, and the mega-companies rehabilitating the rest of the Gardiner.

   

The most recent East-Harbour-related news is the province of Ontario’s April 12 announcement. The province is paving the way for a large amount of housing, office space and other forms of development and amenities to accompany the transit hub being planned at East Harbour.

 

That means, among other things, that in the background the zoning has been changed again, this time to allow a large amount of housing. How and when this additional rezoning was allowed is unclear.

 

The Ontario-government’s April 12 news release enthuses:

 

“The proposal also includes a diverse range of residential space and community amenities surrounding a multi-modal hub or a Union Station of the East that would bring GO rail and SmartTrack station services, Ontario Line subway service and a future TTC streetcar extension.”

 

“… Our government is committed to working together with our municipal partner, the City of Toronto, and landowners to deliver critical transit solutions, while also supporting other essential infrastructure needs in the city,” said Associate Minister [of Transportation Kinga] Surma. “Together, we will bring to life a shared vision for these future subway stations, providing new opportunities for people to live, work and play close to environmentally friendly rapid transit.”

   

Clearly the pact between governments and big developers is unaffected by Covid. And lest we forget, big unions are still in the background. Together they form the three pillars of an unholy trinity that’s growing ever stronger as the counterbalancing power of the populace wanes thanks to Covid.

After obtaining an MSc in molecular biology from the Faculty of Medicine at the University of Calgary, Rosemary Frei became a freelance writer. For the next 22 years she was a medical writer and journalist. She pivoted again in early 2016 to full-time, independent activism and investigative journalism. Her website is RosemaryFrei.ca