Target of 15,000 new financial services jobs by 2015 cannot be met without more development
The City of Toronto is reaching a tipping point where it may no longer be able to accommodate the thousands of new jobs projected to be destined for the city, according to a report prepared for the Toronto Office Coalition (TOC) by the Canadian Urban Institute (CUI) and Real Estate Search Corporation (RESC).
The report notes that one-half of the jobs in Toronto are in office buildings and between one-half and two-thirds of these jobs are in the financial services sector. Current targets set by the Boston Consulting Group for the Toronto Financial Services Alliance call for the creation of 15,000 jobs in the financial services sector to be created by 2015. The TOC report challenges this assumption saying there are simply not enough development ready building sites that could house those jobs in downtown Toronto.
"What this means is that those jobs will go to car-dependent locations outside the (Toronto) region, adding to existing high levels of congestion," said Jeff Orlans, TOC chairman. "Consider the obstacles to office development — commercial taxes that are uncompetitive, a condo boom eating up prime office development space, creating a severe shortage of sites for commercial development, and the fact that it takes five years from a commitment to lease to moving day.
"Frankly that's two years too long for most businesses," Orlans said. "The playing field favours our neighbours in the (suburbs) who will clear the permits in half the time."
The CUI report's authors, Glenn Miller and Iain Dobson, note that over the years, the location of employment in Toronto has changed dramatically with companies other than those connected to the financial services sector leaving the core and growing in areas on either side of the core, but most notably in industrial parks outside of the Toronto region. As a result, Toronto is rapidly becoming a one industry town, dependent on the health of the financial sector.
"No city should be so dependent on one sector," said Dobson. "Nor should such a singularly important sector be taken for granted. Imagine if Oshawa turned a deaf ear to the needs of General Motors," he said. "It could be devastating."
The report urges city and provincial planners to take a number of steps:
•Drafting planning and incentive policies which meet the competitive needs of tenants so that they are able to grow where transit and other amenities are available.
•Introducing tax and land use policies that recognize that office jobs are the only form of high density employment. Steps need to be taken to modify public policy to create a competitive environment for office development.
•Creating conditions on the ground which meet the needs of employers — encouraging them not discouraging them.
•Amending the current provincial growth plan to recognize that significant concentrations of office space exist outside of the designated growth centres, and need to be integrated into the strategy for creating growth centres.
•Committing the province to work with local municipalities in the Greater Toronto Area to adjust priorities and fine tune the planned roll-out of rapid transit projects to better connect to approximately 108 million square feet of office space that is currently dependent on automobile access.
•Creating the necessary provincial legislation to require binding commitments for transit-supportive development along transportation corridors in advance of transit construction.
