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The Value Village outlet at Queen Street East and Logan Avenue in Leslieville, Toronto.D'Arcy McGovern/The Globe and Mail

Real-estate development professionals are warning that Toronto’s program of conferring heritage protections on dozens of retail storefronts in historic neighbourhoods could stall investment in some of the areas most suited for adding residential density.

At issue is an evolving and expanding sense of what heritage is for, which is in tension with other Toronto planning policies that restrict multifamily residential developments to the city’s commercial avenues, while also making it difficult to win approval for the middle-scale buildings that planners and residents claim to prefer to high-rise towers.

“The reality is our Planning Act and the Heritage Act are all about sense of place, so that you don’t come back 20 years from now, and say to your child, I grew up in this neighbourhood but I don’t even see anything that I recall,” said Tamara Anson-Cartwright, the program manager for heritage planning at the City of Toronto. It was her team that recommended 54 new additions to the heritage register (approved by city council on May 5) that are clustered along the Leslieville retail strip on Queen Street East and Carlaw Avenue. Critics of this batch-listing, and others before it, have picked on some examples that seemed less-than-stellar examples of architecture or history, but that misses the point, according to Ms. Anson-Cartwright. “Heritage is not just about the big monuments anymore, it’s about context and an important understanding of humanity.”

But beyond subjective questions of taste, for some, Leslieville is a prime example of an urban neighbourhood with existing surface rapid transit – and a proposed Ontario Line subway stop – that makes it ideal for adding new housing.

“Toronto is physically built out. The official plan directs growth and intensification to a relatively small and well-defined area of the city, while placing significant protections on large swaths of residential land,” said Blair Scorgie, a registered professional planner and Leslieville local, who sent his own submission to the city warning that the effect the heritage designation could be to raise costs too high for any potential developer. “It isn’t simply a question of what the market can take. It is also a question of the degree to which the decisions we make contribute to the ongoing erosion of housing affordability in what has quickly emerged as one of the world’s least affordable urban centres,” he said.

Looking for validation of his thesis, Mr. Scorgie approached Chris White, a partner in the development consultancy UrbanMetrics Inc., to run the numbers for one of the biggest sites in the Leslieville heritage batch: A Value Village location at 924-926 Queen St. E., an unusual L-shaped lot that includes a large surface parking lot off a laneway. Mr. White’s report suggested you could accommodate a six-storey apartment building on the site and, given a fairly conservative timeline, it would be possible to make a profit. But he found that the heritage listing would push the budget to the limit, which might mean you could build essentially luxury townhouses and condo apartments, but it would be unlikely to work financially if there was any requirement for affordable housing.

Rendering of The Davisville, a boutique 12-storey condominium at Yonge Street and Manor Road in Toronto which integrates an existing heritage structure.Rockport

“At the end of the day, you can’t have your cake and eat it, too,” Mr. White said. “With the multifaceted nature of urban development, you can’t have heritage preservation, you can’t deliver affordable housing and you can’t have all the community amenities you’re talking about.”

Jack Winberg, chief executive officer of Rockport Group, builds mid-rise residential in Toronto and has done so with projects that include heritage protections, including a new project, at 2100 Yonge St., called the Davisville that will incorporate a heritage façade into a 12-storey building. He warns against anything that adds costs to the already-challenging building type.

“There’s no economies of scale in mid-rise, so the buildings are more expensive than tower buildings,” Mr. Winberg said. For example: “In most cases I can’t use a hammerhead crane [the kind you’ll see on a 20-storey or more building], I have to use a luffer; that takes 20 per cent more time. A 12-storey building needs two elevators, a 40-storey building only needs three.” Also, each heritage structure will have a different budget for preservation: For his Montgomery Square building, where Rockport put a 27-storey tower above an a historic postal station, Mr. Winberg said one of the major costs was a $2-million steel structure to hold the façade in place while work went on.

“Mid-rise has got all of these factors, and heritage is very much potentially the straw that will break the back,” he said.

Advocates for affordable housing noted in submissions to the city that 1,300 main-street properties have been added to the heritage register in the past four years. The fear is the heritage listings will shrink-wrap entire avenues, sealing them off from any new development.

Ms. Anson-Cartwright disputes that notion, pointing out the Leslieville batch listing only covers 20 per cent of the strip’s frontages. “That means 80 per cent could be new, and you can still build on top of the 20 per cent of street-wall that is protected.” And while 1,300 new heritage addresses may seem like a lot, her team has examined many times that number, close to 8,000 locations, and many more were rejected than added. “We’ve done our due diligence; we’re looking at individual buildings, we’re not just throwing 500 addresses up for the sake of it,” she said.

At present the city is consulting with communities for 10 more potential heritage districts, including Bloor West Village, Danforth Avenue (Broadview to Coxwell), Mount Dennis, Parkdale Main Street and Scarborough Centre.

Preserving the fine-grain retail of a strip like Leslieville’s Queen Street East would seem desirable, but Mr. Scorgie points out that streets behind that strip experience the side effects of neighbourhood planning restrictions: The gentrification of duplexes, smaller houses and rooming houses that are being purchased and converted to large, expensive single-family homes.

“Our neighbourhoods ... have experienced decades of population decline. It is happening quickly, and it is contributing to the socio-economic polarization of our city. The introduction of mid-rise development, on avenues such as Queen Street East, represents a redistribution and rebalancing of growth,” he said.

“I am not an expert in land economics or cultural heritage preservation. But I see what is happening, and I cannot help but sound the alarm. Something has to give.”

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