Toronto’s potential removal of retail, office & institutional permissions to implement new definition of employment areas – Consultation needed?

November 30, 2023 | David Tang

Owners of retail, office and institutional land in Toronto should consider the impacts of a recent Report For Action and Proposed Policy Direction from the City of Toronto and whether they should engage in consultation with the City to:

  • prevent erosion in their ability to expand their retail/office/institutional facilities and/or
  • seek to eliminate the procedural limitations currently in place for redevelopment of those “Employment” lands for residential uses.

This article explains why owners of retail, office or institutional lands may wish to be involved in the ongoing consultation with the City and why they should, at the very least, protect their right to appeal what will ultimately become OPA 680 to the Ontario Land Tribunal by filing the requisite submissions and comments with the City.   The report is headed towards the City Council meeting on December 13, 2023.  While it is unlikely that a final decision will  be made before the end of the year, requesting consultation and filing written submissions to Council ensures an appeal is available if needed.


The City’s proposed Official Plan Amendment 680 arises out of the Province of Ontario’s Bill 97, designed to address the lack of affordable housing in the Province.  The Bill reintroduced a clear distinction between industrial/warehousing uses and retail/office/institutional uses.  All of those uses have been called Employment uses and treated similarly for many years.  Lands designated by an Official Plan for those uses may not be converted for residential development, except through a municipally-initiated comprehensive review (a MCR).  By splitting what many still think of as industrial and commercial uses back into two distinct categories, Bill 97 allowed and arguably intended commercial (retail and office) and institutional lands to be treated differently.

There remains some uncertainty about how the Province intends Bill 97’s amendments to be interpreted and implemented.   The Provincial Policy Statement (PPS) is to be amended to capture these amendments to the Planning Act in its employment area definition and policies.  While the commenting period for the updated draft published June 16, 2023 is over, the PPS has not been finalized and could provide further direction on how the Bill’s provisions are to be implemented.

What is quite clear is that Bill 97, the Helping Homebuyers, Protecting Tenants Act,  is an attempt to create a planning regime that opens up additional land for housing by limiting the procedural protections against conversion of “areas of employment” for housing to only those lands which are truly used for industrial and warehousing purposes.  It removes the procedural impediments for residential conversions from any lands that are designated for retail uses, office uses and institutional purposes.  In other words, we are moving back into a regime with a clear distinction between industrial lands and commercial lands with no MCR requirement for conversions of commercial lands.

There is a grandfathering provision that somewhat convolutedly recognizes that some lands that are currently used for commercial or institutional uses can be authorized for the “continuation” of such a use if the use was in place when the Act was amended.  Otherwise, the new definition of “areas of employment”, to which the procedural protections apply, would not allow a municipality to include such uses in lands to which it wants the MCR protection to apply.

In the author’s view, the Bill likely contemplates three categories of land designations:

  1. Areas of employment that primarily permit industrial and warehousing uses.  Retail or office uses which are ancillary to a main industrial or warehousing use are acceptable.   However, no stand-alone retail, office or institutional uses would be permitted in these areas.   These lands would be protected from residential and commercial conversions by the MCR requirement.
  2. Areas of employment that permit only currently existing retail/office/institutional uses to “continue”. This likely means there would not be either a right to (a) introduce new commercial or institution developments nor (b) expand even those existing facilities. These lands would also be protected from residential conversions by the MCR requirement.
  3. Commercial or institutional areas where retail, office and institutional uses are permitted.  These lands would be more easily converted for residential purposes as they would not be “areas of employment” to which the MCR requirement applies.

We expect that the Province anticipated that municipalities would choose to use that third option for at least some of the lands on which there are existing retail or office developments.   That is the only way in which more land can be made more readily available for residential conversions.

Toronto’s Indicated Policy Direction

The City’s recent recommendation report proposes an Official Plan Amendment (680) to implement the Bill 97 changes.  It contains “Proposed Policy Directions” which suggest that planning staff have chosen to try and keep as much of the current Employment lands under the MCR procedural protection as possible.  Rather than designate land on which there is existing retail into the third category, the City appears poised to entirely remove the permission for stand-alone retail and office use from the existing Employment designations (General Employment Areas in the case of stand-alone retail uses and both General Employment and Core Employment Areas for office uses) where they are permitted today.

For most landowners, option 3, where existing stand-alone retail/office/institutional lands are moved into a separate Commercial or Institutional land designation (where those uses would remain permissible) is preferable.  Their lands would no longer be protected from residential conversion in the same way as they have been for close to 20 years.   In addition, and perhaps more importantly to many commercial landowners, their ability to expand or redevelop for retail, office or institutional purposes would continue.  Indeed, some owners may be primarily concerned with the ability to expand their current facilities and may wish to find a way to ensure they can do so, even if they have no concerns about being able to easily propose residential redevelopment.

The report explicitly contemplates consultation with landowners before the Official Plan Amendment is finalized for adoption.  The specific provisions of the proposed Official Plan Amendment 680 are not yet finalized and landowners now have a chance to influence how their lands are affected by that Official Plan Amendment.

If you have questions or wish representation for either engagement in the consultative process with the City or to preserve your right of appeal, please feel free to contact Miller Thomson LLP’s Municipal, Planning & Land Development lawyers.


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