You’ve cleared the planning department, secured your zoning, and finalized your urban design. Under traditional real estate assumptions, you’d be preparing to break ground.
But in Ontario’s current development landscape, you might actually be sitting on an unbuildable piece of land for the next decade.
Across the province, the primary factor halting development is no longer entitlement risk — it’s sanitary and water capacity. Miles of approved residential density sit completely frozen because municipal trunk lines are undersized, or simply don't exist.
At a recent ULI Toronto event hosted at Crozier Consulting Engineers’ office, industry leaders gathered to address how developers are using alternative servicing models, municipal service corporations, and decentralized technology to get projects off the shelf.
The True Pro Forma Cost of Infrastructure Delays
When municipal servicing stalls, the carrying costs hit developer pro formas hard.
Richard Aubry, VP of Design, Development & Construction at Redwood Properties, presented a striking case study: a 140-acre master-planned site designed for 3,000 units in York Region. The site has been stuck in neutral for over ten years because it was tied to the regional Upper York Sewage Solutions infrastructure project. After $50 million was spent on engineering alone, the provincial government scrapped the regional facility in favour of a long conveyance pipe down to Lake Ontario — a multi-billion-dollar decision that pushes timeline guarantees decades into the future.
"The end user is paying for that pipe three times," Aubry explained. "They're paying through their DCs, they're paying for front-ending it, and they're paying for its replacement over time with taxes... Nothing is more expensive than the traditional public infrastructure system, because it has to be big enough to warrant its initial investment. When you do smaller, surgical infrastructure, it’s way cheaper and very scalable."
Beyond saving capital, localized package plants offer phased delivery. Rather than front-funding massive infrastructure years before project absorption, developers can deploy modular treatment units that scale incrementally as sales and construction phases roll out.
Unlocking the Missing Middle
For institutional developers like QuadReal Property Group, managing private and communal servicing is a core operational reality across non-urban and land-lease markets.
Phil Busby, Director of Development at QuadReal, pointed out that traditional servicing constraints directly suppress land value and delay entitlements. "The pace at which we proceed with entitlements really slows down when you know that the infrastructure is not there to back you up," Busby said.
The legal and financial mechanisms to solve this bottleneck are shifting rapidly. As Katherine Rentsch, Manager of Private Services at Crozier, highlighted, provincial updates under Bill 60 (Wastewater Public Corporations Act) and Bill 98 are opening new avenues for Municipal Service Corporations (MSCs):
- Shifting Operational Risk: Historically, municipalities avoided private communal systems out of fear of taking on liability through Municipal Responsibility Agreements (MRAs). MSCs create arm's-length, publicly owned utility entities capable of operating communal infrastructure on a cost-recovery basis.
- Releasing Capital: Moving away from traditional private ownership models allows developers to transfer ongoing operational liabilities and recover capital tied up in perpetual Letters of Credit.
- Accelerated EA Pathways: Subsurface communal systems often avoid the drawn-out Municipal Class Environmental Assessment (EA) process required for large surface-discharge plants, shaving years off the approval timeline.
In rural and peri-urban markets, this framework acts as a catalyst. Justin Bromberg, CEO of Frontenac Municipal Services — Ontario’s first rural MSC — described communal servicing as the "missing middle" of infrastructure.
"For us, the MSC with communal services was the missing middle," Bromberg said. "It allows us to have a professionally operated, municipally owned utility serving a cluster of development at the scale that actually makes sense for our communities — too dense for individual septic systems and too small for conventional infrastructure."
Via STOREYS Editorial team
Repositioning Servicing as a Competitive Advantage
Beyond basic risk mitigation, forward-thinking developers are treating localized water treatment as an amenity and an asset class.
Because modern package treatment produces high-grade reclaimed water on-site, developers can divert effluent away from municipal overflow and toward local district thermal loops, irrigation, or urban agriculture.
The technology is established, and the legislative architecture is coming together. The remaining variable is whether developers and municipalities choose to wait on municipal pipe extensions or take control of their own servicing destiny.
As Aubry put it: "Ontario is a world leader in wastewater filtration — we export it all over the world, but we're not utilizing it enough in our own province. Municipalities have to have the courage to either take control or relinquish control, and right now, many are willing to do neither."
