The developer Ivanhoe Cambridge is pledging to build a new GO Transit bus terminal in downtown Toronto, part of a $2-billion project with an ambitious timeline that will depend on pre-leasing the attached office space.
The cost to the public agency for the new terminal is set at more than $106-million, with at least $30-million of that coming from the sale of the site of the current terminal. The remainder will come from the capital budget of Metrolinx, the regional transit agency that operates GO Transit and will manage the bus terminal.
Under the proposed timeline, the new terminal will open by 2018 and offer a 50 per cent increase in bus capacity. Construction would start as early as next spring and the current terminal would remain open until its replacement is ready.
"This gives us the expanded capacity we need," Metrolinx Chair Rob Prichard said Tuesday. "It does it by integrating this with PATH and with Union station."
Another advantage, he added, is that the terminal is moving south of the train tracks, allowing access to double-decker buses that cannot fit under that low bridge.
The current commuter bus terminal is immediately north of the rail corridor, on the east side of Bay Street. The plan calls for its replacement to be sited just to the south, on the other side of the corridor. Twin 48-storey towers would be built on each site, with a "skypark" linking them over the rail corridor.
The office towers proposed by Ivanhoe Cambridge will total about 2.7 million square feet gross leaseable area. They do not yet have anchor tenants for the towers.
Asked about what some are calling a "glut" of office space in downtown Toronto, senior executives expressed confidence.
"We think we're actually going to be timing the market quite well in terms of when the completion date would be in terms of the number of large-space tenants coming to the market," said Paul Gleeson, executive vice-president of development for Ivanhoe.
Stuart Barron, national director of research at the real estate services firm Cushman & Wakefield, said the commercial vacancy rate in downtown Toronto is "relatively tight" at 4.9 per cent. That could roughly double by 2017, he added, as millions of square feet of pending development begin to come on stream.
But he said there should be room for this project, with factors such as reverse migration making the city centre increasingly desirable for companies.
"I believe downtown Toronto could absorb an additional two to three million square feet," he said. "It's going to take a little bit of time."
Absent from the proposal is a firm plan to relocate intercity buses from their terminal near Bay and Dundas. Putting all the buses at the new site would reduce the need for coaches to drive through the city core while also freeing up a huge downtown site for redevelopment.
Transportation Minister Steven Del Duca said the new spot for GO buses would have the capacity to handle inter-city coaches as well. But he said that was a matter for another day.
"This builds the capacity to have that discussion to make sure that people understand that is a, sort of, as I mentioned in my remarks, a one-stop shop opportunity," he said. "So there will be discussions I'm sure that will take place in the coming months and years."