🚃 In transit

Good morning!  📉 U.S. builders are also feeling the pain of tariffs. American federal data shows the cost of materials and services used in nonresidential construction rose 2.6% year-over-year in July—the sharpest increase since early 2023—driven largely by new tariffs on aluminum, steel, and copper.

⏰ Today’s read: 5 minutes

MARKETS

Economy: In June, the total value of building permits in Canada dropped by $1.2 billion (–9.0%) to $12.0 billion, with the institutional component in Ontario falling sharply from $1.9 billion in May to $538 million, driving much of the decrease. Although the total declined 9.5% month-over-month in constant dollars (2023=100), it remained 6.9% higher than a year earlier. Residential permits also fell by $318 million to $7.1 billion—largely due to a steep $486.8 million drop in B.C.’s multi-family segment.

NEED TO KNOW

The week's headlines

🏗️ Shaft work: Construction has begun on a second tunnel launch shaft for the Ontario Line near the future Gerrard Station, enabling three kilometres of twin tunnels under Pape Avenue and marking a key step in Toronto’s largest transit expansion. The $70-billion project will add 15 stations and more than 40 transit connections, cutting commutes from Exhibition Place to the Eglinton Crosstown to 30 minutes or less while easing congestion on existing subway lines.

💰 Prompt payment: The BC construction industry is welcoming the 2026 Budget Committee’s formal recommendation to accelerate Prompt Payment legislation, a move seen as a turning point in addressing chronic late payments and aligning the province with others that have already acted. The committee’s report also calls for increased infrastructure investment, expanded funding for construction-related training, a review of paid sick leave policy, and improvements to public sector procurement.

🚧 Municipal infrastructure: Ontario is investing an additional $1.6 billion into the Municipal Housing Infrastructure Program, nearly doubling it to $4 billion to help municipalities and Indigenous communities build the roads, bridges and water systems needed to unlock new housing. The funding is part of the province’s $200-billion capital plan, which includes $33 billion this year alone for transit, highways, hospitals, schools and housing infrastructure.

⚖️ Big decision: The B.C. Supreme Court has recognized the Cowichan Nation’s Aboriginal title and fishing rights over part of Lulu Island in Richmond, B.C., encompassing Crown, city, and private lands. The court ruled that the province must negotiate with the Nation, as past grants of private land titles unjustifiably infringed on Aboriginal rights. The province has announced it will appeal, warning of potential consequences for private land ownership.

THE BIG STORY

Can building near transit create affordable housing?

Government is eyeing transit hubs as catalysts  for home construction. Ontario just approved higher density and building heights around 120 Toronto transit stations, a move city and province say could accommodate 1.5M+ homes over 25 years once fully implemented. B.C., meanwhile, has hard‑wired TOD into law—requiring cities to upzone near rapid transit and drop residential parking minimums. 

“Toronto needs more affordable housing,” Mayor Olivia Chow said, framing the approvals as a tool to “build more homes near transit to support our city’s growth.”

The pitch: Concentrate growth around rail and bus hubs to unlock housing supply where infrastructure already exists. In Toronto, changes also trigger inclusionary zoning, meaning some projects must include affordable units. B.C.’s framework designates TOD Areas within 800 m of rapid transit, sets minimum densities, and bans off‑street residential parking minimums to lower costs and support transit use.

What the data says: CMHC’s multi‑city study concludes TODs often don’t deliver affordable homes by default. Researchers argued that achieving it requires a “multi‑pronged approach” (public land, targeted subsidies/financing, IZ, and partnerships with non‑profits). Without such levers, TODs tend to be mixed‑use but not mixed‑income.

Global context: International experience shows the model can work when public entities capture land‑value gains and hardwire affordability. Copenhagen financed metro expansion with value‑capture tied to publicly owned station‑area land—pairing growth with social objectives. The lesson: align upzoning, public land strategy, and affordability mandates from day one.

What’s next: Toronto still needs secondary plans and site‑by‑site approvals to translate capacity into shovels, and several station areas remain under further review. In B.C., municipalities are updating bylaws to meet provincial TOD minimums and parking reforms. Ultimately, the specifics—how much affordable housing is required, where it will be located, and on whose land—will determine whether TOD actually improves affordability or shifts demand.

PROJECT SPOTLIGHT

A capital idea

Starlight Investments has begun construction on the first phase of Harris Green Village in downtown Victoria, which will add 526 rental units across two towers at 1045 Yates St., including 80 affordable suites, underground parking, and 36,000 sq ft of retail space featuring a grocery store and future daycare. The three-phase development will ultimately deliver over 1,500 rental homes in towers up to 32 storeys, making it the city’s biggest housing project ever.

PROJECT UPDATES

Yukon First Nation completes 1.9MW solar facility

Calgary converting Barclay Centre to housing

Wildstone wins Dawson Recreation Centre contract

Bridge replacement to improve Highway 1 through Fraser Canyon

Work begins on Ma Faamii centre

Fire rips through Langley housing project

WHAT WE’RE TALKING ABOUT

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🚧 WATCH: Was this the most dangerous building in Manhattan?

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Here’s to a great rest of the week!

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