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Report on Business Sidewalk Labs unveils $1.3-billion plan for Toronto’s waterfront, revealing a vision much larger than initially proposed

Dan Doctoroff, CEO of Sidewalk Labs, is photographed during a press conference in Toronto, on June 24. During an embargoed press conference, the media were given Toronto Tomorrow, Sidewalk's Proposal for development of a part of Toronto's eastern waterfront.

Fred Lum

Google affiliate Sidewalk Labs LLC is pushing for the right to create a 190-acre community on Toronto’s waterfront, laying out a master plan that would ask government to expand public transit, pay performance bonuses to the company and rewrite municipal and provincial laws.

The New York-based urban-planning firm, which is controlled by Google’s parent company, Alphabet Inc., published a 1,524-page draft master plan Monday – 20 months after the development agency Waterfront Toronto announced that it would work with Sidewalk to plan a 12-acre community on the eastern shore of Toronto’s harbour.

The new plan asks to have a hand in planning development in a plot 16 times that size - and if approved, Sidewalk would spend $1.3-billion over the next 20 years there. On Monday, Waterfront Toronto chair Stephen Diamond called the plan — which would require significantly more approvals from his agency and governments — “aggressive."

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Sidewalk says tens of thousands of people could live and work in the new area, and that it could generate billions of dollars for the economy. Cameras and sensors could capture data that Sidewalk and companies could use to get a better understanding of how people move around cities, and possibly develop new technology to improve city life.

The neighbourhood would have tall buildings made from timber with ground-floor spaces shielded from the elements to let residents spend more time outside year-round. Sensors at traffic lights would detect when slower pedestrians are approaching and adjust timing to give them more time to cross; curbside parking spaces could be monitored and pre-booked.

Concerns about the proposal have centred on the consequences of letting a giant U.S. company -- rather than governments -- plan a community and collect data on Canadians from which it could generate profitable innovations. Others have centred on the project’s growing scope and unclear goals.

Mr. Diamond said it was not clear if some of Sidewalk’s requests were possible or even legal, such as in the case of tall timber buildings.

“It’s a lot to ask for at an initial stage,” he said. He noted that key questions, particularly around technology, remained unanswered. “There’s 1,500 pages here, but there’s still gaps.”

Since it first applied to develop the 12-acre site, which it referred to as Quayside, at the foot of Parliament Street in Toronto, Sidewalk has maintained it would need a much larger parcel to implement all of the innovations and sensors it would use to test and develop technology, such as traffic signals that adapt to different situations in an intersection.

The draft master plan, indicates that Sidewalk wants to develop not just Quayside but also the western portion of nearby Villiers Island, where it would create an “urban innovation campus” for startups and a new Google Canada headquarters. The remainder of the 190 acres includes the rest of Villiers Island, Polson Quay and a chunk of land just east of the Don River.

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Pending government approvals on the additional land, Sidewalk would help plan the design, implement technology, and potentially help finance infrastructure, including for light-rail transit in the community, but would let others do the building.

“It’s totally up to the government to decide, but we were very clear from the beginning that we thought greater scale would be necessary,” Sidewalk Labs chief executive officer Dan Doctoroff said in an interview at the company’s Toronto headquarters. But he added that if some parts of its plan, such as developing western Villiers Island, were not approved, Sidewalk would reconsider staying in Toronto: “Clearly, the project becomes less appealing.”

Waterfront Toronto, an agency controlled by the municipal, provincial and federal governments, oversees development along Lake Ontario, will consult the public on the plan for the next six months; if its board approves it, all levels of government would have to approve many of its components.

Some government officials said on Monday they trust Waterfront Toronto and its public consultation process, while others distanced themselves or expressed caution.

Toronto Mayor John Tory issued a brief statement praising the plan’s potential for innovation and job creation, noting that it remains subject to government approvals.

Calling it the “Quayside project,” the name for the initial 12-acre parcel, he did not mention the larger swath of the waterfront Sidewalk wants now. Mr. Tory said that it was important the project proceed in a transparent manner: “I firmly believe that we must develop our waterfront in the right way.”

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City councillor Paula Fletcher, a critic of the project whose ward includes much of the site, called the proposal a “land grab” for prime real estate worth billions. She said she wanted to see a proposal for a 12-acre prototype, not a 200-acre master plan with prime real-estate set aside for Google’s own headquarters: “That was never in their [agreement],” she said.

Councillor Joe Cressy, a Waterfront Toronto board member, called the bid to extend the project to a large portion of the Eastern Waterfront a non-starter. “When it comes to the broader Port Lands, those lands are not up for sale,” Mr. Cressy said of the largely city-owned land.

Calls to Ontario Premier Doug Ford’s office were referred to Infrastructure Minister Laurie Scott, who said her staff were still reviewing the proposal. Ms. Scott said she had “full confidence” in Waterfront Toronto’s board to decide on the plan. In an e-mailed statement, federal Infrastructure Minister François-Philippe Champagne’s office welcomed the plan and said it would monitor the process as the public is consulted.

While Waterfront Toronto owns the Quayside site, the the City of Toronto and Ports Toronto own the Villiers Island land, meaning further municipal approvals would be required for Sidewalk to get it. (Asked about municipal-level discussions about the site, Mr. Doctoroff said “generally, people are quite enthusiastic.”)

In the plan, Sidewalk has offered a $300-million line of credit to help build municipal infrastructure.

If it reaches growth targets with the project, Sidewalk is asking for what the report calls “performance payments” from governments. Details of both would be subject to negotiations. Meanwhile, it is also offering governments 10 per cent of the profits generated by any new technologies Sidewalk develops there for 10 years.

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Critics of the project have argued that Canadians should see a fair return for innovations developed from data collected within the neighbourhood. IP lawyer Jim Hinton called the plan’s IP terms “laughably stupid.”

“They’ve invited us along on a fishing trip, but the boat is theirs, the rods are theirs, the total catch will be theirs, at best we’ll do is have a nice afternoon and maybe share in a shore lunch,” he said in an e-mail.

Sidewalk also proposes numerous regulatory changes at the municipal and provincial level to accommodate its plans for traffic, technology and tall timber buildings. This includes amendments to the City of Toronto Act and the Ontario Highway Traffic Act.

Sidewalk says the Quayside site alone is insufficient for both the scale of technology it hopes to deploy and the investment in transit it says the eastern waterfront needs. The company calls expanded transit “critical” to the development, and has offered to help finance a 6.5-kilometre rail line, but not own it. It expects it would cost about $1.2-billion, and would be willing to offer up to $100-million in loans to support it.

Mr. Diamond said he is eager to consult the public on Sidewalk’s plans, although he is worried that conditions that are out of Waterfront’s hands, such as transit, will make the process difficult. “It’s hard to figure out where we’re going on a public process with the issue of transit being held over our heads,” the chair said.

Jeremiah Shamess, vice-president of the Toronto-based commercial real estate company Colliers International, called Sidewalk’s plan “unprecedented, but it could be a good thing for the city because if you look at Toronto historically, it’s been frozen in time to make any massive or progressive changes.”

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The activist-led group #BlockSidewalk agreed with Waterfront Toronto’s assessment of the plan. “Each of their concerns are very big," said Saadia Muzaffar, a spokesperson who last year resigned as a Waterfront digital-strategy adviser over concerns about the partnership. “They’re very big process, authority, responsibility, jurisdiction and control-related concerns. These are not small things.”

With a report from Stefanie Marotta.

Editor’s note: (July 25, 2019) A story on sidewalk labs incorrectly said councilor Joe Cressy said the company’s proposal to extend the project beyond Quayside to Villiers Island is a nonstarter. In fact he was referring to the proposal to extend the project to a large portion of the Eastern Waterfront.

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