Downsview to host Canada’s first major modular housing project

Toronto’s Downsview lands are set to become the testing ground for one of Canada’s most ambitious housing experiments — a large-scale modular housing community backed by hundreds of millions in public funding and a plan to build faster, more affordable homes.

This week, federal and municipal leaders announced that the first Build Canada Homes project will rise on the former Downsview Airport site, a 210-hectare stretch of North York once home to military operations and aircraft manufacturing. Now envisioned as a “city within a city,” the redevelopment will eventually house more than 100,000 people.

Why Downsview was chosen

Downsview’s transformation has been years in the making. Located in northwestern Toronto, the site sits along key transit corridors including the Downsview Park GO station and Line 1 of the TTC subway. Its scale, proximity to infrastructure and existing federal land ownership made it an attractive choice for a national pilot.

Toronto Mayor Olivia Chow said at a press conference (1) that the project’s next stage was made possible by a $425-million investment from the city and $280 million from the federal government to expand the Black Creek Trunk Sewer, built in the 1960s and now near capacity.

Expanding the sewer, Chow said, is “unlocking the potential of this neighbourhood.” Without the upgrade, construction on as many as 63,000 housing units could stall.

Federal Housing Minister Gregor Robertson noted how the investment would help speed up approvals and give developers certainty. “We have come to the point now where growth has outpaced capacity, and without an upgrade, the city cannot approve new housing permits in this (area),” he said during the press conference. “In the short term, our investment will ensure new housing developments can be approved with confidence and at speed.”

Sponsored

Smart investing starts here

Build your own investment portfolio with CIBC Investor’s Edge online and mobile trading platform. Enjoy low commissions on trades and special pricing for active traders, students and young investors.

Get started today

A first for Build Canada Homes

The project is also the debut of Prime Minister Mark Carney’s new housing agency, Build Canada Homes, which aims to use public land to accelerate construction of affordable and market units. Its newly appointed head, former Toronto councillor Ana Bailão, said Downsview will be the first of many modular housing builds under the program.

“Build Canada Homes is advancing new approaches to housing delivery,” Bailão said in a statement. “Our first development in Toronto will help demonstrate how coordinated public-private partnerships and innovation in home building can support the accelerated construction of below-market homes in growing communities.”

The plan includes 540 modular homes, at least 40% of which will be affordable, with options ranging from studios to three-bedroom units.

Modular housing gains ground

Modular homes are built in sections in factories and then assembled on-site, allowing for faster and more cost-efficient construction. According to the Canadian Real Estate Association, modular and prefab homes can reduce build times by 20 to 50% compared to traditional construction (2), while the CSA Group reports potential cost savings of up to 20% under the right conditions (3).

While still a small share of Canada’s housing market, modular housing is gaining attention. Several Ontario municipalities — including Hamilton, London and Toronto — have used modular builds to provide supportive housing, citing speed and energy efficiency as major benefits. A two-storey modular home can often be completed in less than six months.

The approach is also growing internationally. In the United Kingdom, modular construction accounts for about 7% of new housing, while Japan has used it for decades to offset labour shortages and reduce waste.

Sponsored

Take control of your money with Monarch

Simplify your finances with Monarch, the all-in-one app designed to help you budget, track spending, and hit your goals faster. For a limited time, get 50% off your first year with code WISE50.

Start your free trial today

What it means for home seekers

For Canadians struggling to find affordable housing, modular development could help shorten wait times and expand supply more quickly. The Downsview pilot will serve as a national test case for whether factory-built housing can scale to meet demand in high-cost urban markets.

Experts say the benefits extend beyond affordability. Modular homes can be designed for energy efficiency, accessibility and adaptability — features increasingly important for urban living and aging populations.

How to access modular housing programs

While most modular projects in Canada are operated by municipalities or non-profit partners, home seekers can monitor local housing agency websites for application details as units become available.

In Toronto, affordable housing wait-lists and modular home pilot information are posted through the city’s Housing Secretariat. Buyers interested in market-rate modular homes can also explore private developers who offer factory-built options that meet Ontario Building Code standards and may qualify for traditional mortgage financing through major lenders.

As the Downsview redevelopment moves forward, city officials describe it as a 30-year vision that could reshape an entire part of Toronto. For now, it marks the beginning of a broader experiment in how Canada builds — and how quickly it can catch up to its housing needs.

Article sources

We rely only on vetted sources and credible third-party reporting. For details, see our editorial ethics and guidelines.

Global News (1); CREA (2); Modular Building Institute (3)