Scarborough Junction Development Update - Urban Toronto Article

 Province Invests $178M to Advance Scarborough Junction Rental Housing Phase

A major provincial investment is set to advance the first phase of the Scarborough Junction Masterplan, a transit-oriented community planned around Scarborough GO station. The Ontario government has announced an investment of up to $178 million through the Building Ontario Fund (BOF) to support approximately 1,700 purpose-built rental homes, including 340 affordable units with below-market rents. The funding comes as the development moves forward on lands surrounding the station after facing challenging market conditions that are affecting developers across Canada.

Led by Republic Developments and Harlo Capital, the Scarborough Junction Masterplan would transform approximately 10.6ha of underutilized land surrounding the GO station. Designed by Giannone Petricone Associates, the approved plan calls for 12 buildings rising up to 58 storeys and 7,655 homes, alongside over 19,000m² of retail space and more than 5,200m² of institutional uses.

Looking south to the Scarborough Junction Masterplan, designed by Giannone Petricone Associates for Republic Developments and Harlo Capital

Central to the announcement is the BOF, a provincial investment vehicle established in 2024 to partner with private-sector and institutional investors on projects deemed important to Ontario's long-term growth. The fund invests capital to close financing gaps and advance projects that might otherwise remain on hold. The investment will be made through a joint venture between BOF, Republic Developments, and Harlo Capital, with the Province holding an ownership stake and governance rights. Once repaid, the capital would be redeployed into future projects across BOF's priority sectors. 

The Scarborough Junction transaction marks BOF's second investment in affordable housing and second intervention aimed at supporting Ontario's homebuilding sector. Earlier this year, the fund committed $300 million to High Art Capital to acquire unsold condominium units across the GTA and convert them into rental housing, with a portion offered at below-market rents.

“To support our plan to protect Ontario, our government is delivering long-term affordable housing in a rapidly growing area of the Greater Toronto Area,” said Ontario Minister of Finance Peter Bethlenfalvy. “Through the Building Ontario Fund, we are leveraging innovative financing tools to unlock rental housing supply that otherwise would not be delivered and transforming underused land into a vibrant transit-connected community.”

The initial phase of Scarborough Junction would add approximately 1,700 purpose-built rental homes, including a minimum of 340 affordable units with below-market rents secured for 40 years and intended to qualify for City of Toronto affordable housing programs. Construction is expected to begin in 2027, with first occupancies anticipated by 2030. The buildings are expected to be completed by the end of 2030 and fully occupied by 2033.

“Scarborough Junction shows the role Building Ontario Fund can play in getting housing built when market conditions make it difficult to move projects forward,” said BOF CEO Michael Fedchyshyn. “Our investment helps unlock this transformative development, secure long-term affordable homes, and deliver real, lasting benefits for the community.”

An aerial view of the site and surrounding area, image retrieved from Google Maps

The investment follows a period of uncertainty for the project following its zoning approval. The developers marketed the site for sale in 2025, but no purchaser emerged, paving the way for the BOF partnership. 

“We need to get more housing of all types built across the province, faster and smarter,” said Minister of Municipal Affairs and Housing Rob Flack. “That is why we have introduced a series of measures to reduce the time and cost of building, including the expansion of the HST rebate, the introduction of the Development Charge Reduction Program, and transformational legislative reforms through Bills 17, 60 and 98. Despite this work, we know our job isn’t done; and this investment through the Building Ontario Fund is bringing housing online at a time when it is much-needed.”

The Scarborough Junction announcement builds on other housing initiatives, including the Development Charge Reduction Program, part of the Canada-Ontario Partnership to Build. The program would provide infrastructure funding to municipalities that lower residential development charges, complementing recent HST relief measures and financing tools such as the BOF.

UrbanToronto will continue to follow progress on this development, but in the meantime, you can learn more about it from our Database file, linked below. If you'd like, you can join in on the conversation in the associated Project Forum thread or leave a comment in the space provided on this page.

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Complete Urban Toronto Article: Province Invests $178M to Advance Scarborough Junction Rental Housing Phase | UrbanToronto

Globe and Mail Article: https://www.theglobeandmail.com/business/article-building-ontario-fund-scarborough-junction-housing-project/