Frequently asked questions

What is Missing Middle Housing?

Missing middle housing refers to gentle density housing forms that fall in the “middle” of single-family homes and mid-rise apartment buildings, such as fourplexes and sixplexes. This type of housing is considered “missing” across Toronto neighbourhoods due to restrictive zoning laws, which have since been amended and relaxed primarily through the Multiplex Bylaw enacted in 2023.

Fourplexes and sixplexes often look like large houses, fitting into existing residential streetscapes and neighbourhoods. They provide a housing form that is affordable and attainable, opening doors to neighbourhood living and providing residents with a sense of community, with amenities and services close to home. Well-designed multiplexes offer more versatile and larger living spaces compared to modern day condos and apartments, often with private outdoor spaces.

These types of projects are often referred to as “4+1” or “6+1,” representing the number of units in the main building plus one additional unit in the garden or laneway suite.

What does Modcity help with?

Modcity has positioned itself as a full service multiplex shop, overseeing all four critical project stages: land purchase, permitting, construction and financing.

We provide purchase advisory services grounded in real construction experience. Having evaluated hundreds of properties and lots, we know precisely which site conditions to scrutinize and the risks that commonly arise. Our team reviews over 20 critical site variables, including bylaws and zoning, ensuring decisions are guided by more than price or location alone. These reviews are collaborative, involving trusted consultants such as architects, planners, engineers and key structural trades like framers and foundation specialists.

We deliver end-to-end permitting services, from preliminary architectural drawings and zoning analysis to coordination with city staff, committee of adjustment representation and building permit submissions and approvals. 9 out of 10 times, Modcity recommends going to committee of adjustment to seek minor variances for a larger building envelope to unlock the full potential of each lot.

Construction is our core competency, with our team bringing a combined 50+ years of experience. As a premium multiplex builder, durability and long-lasting builds are our baseline standard, delivered to rigorous specifications with no shortcuts. Our interiors are finished to an elevated, premium-commanding specification.

All financing is arranged and coordinated by Modcity across the full project lifecycle: initial land purchase, construction, and finally permanent financing through CMHC upon project completion. All Modcity projects utilize CMHC MLI Select financing, a critical advantage that enhances leverage, mortgage terms and overall proforma profitability.

What are Modcity's timelines for permitting and construction?

For 4+1 and 6+1 projects, Modcity typically secures all necessary permits within five months of property purchase and completes construction within ten months of building permit approvals, resulting in a total project timeline of approximately 15 months.

For larger lots, where Modcity undertakes a land severance to enable two semi-detached fourplexes or sixplexes with two garden or laneway suites (for a total of 10 or more units), we generally secure all permits within eight months of purchase and complete construction within 12 months of building permit approvals.

Modcity’s execution is grounded in speed, with planning and permit approvals secured 30% faster and build-out completed 25% quicker compared to most multiplex developers and builders.

What are Modcity's target returns?

For joint ventures and co-investment opportunities, every Modcity project is conservatively underwritten and pursued only when proforma analyses support a minimum 35% annualized IRR. We structure our projects to return at least 100% of each investor’s initial cash investment upon construction completion through CMHC refinancing, in addition to providing substantial equity uplift.

Do I get an HST rebate when building a multiplex?

As of November 2023, the federal governments waived all HST on development and construction costs for purpose-built rental multiplexes with at least four units. This incentive is a key driver attracting investment to these projects, effectively reducing total costs by 13%, increasing potential profits, and easing cash-flow requirements for investors. While vendors (consultants, subcontractors, and suppliers) must still charge HST tax on invoices, landowners can now receive a 100% rebate every month through a simple process that Modcity helps to coordinate.

Does Modcity use CMHC financing?

Modcity recommends using either conventional private financing or CMHC financing for construction, but always opts for CMHC financing for permanent mortgage takeout, that is, upon construction completion and occupancy.

CMHC MLI Select employs a points-based system to offer highly attractive mortgage terms, including higher LTV ratios (85% to 95%) and longer amortizations (40 to 50 years), based on three criteria: affordability, energy efficiency, and accessibility. The more points a project earns, the better the mortgage terms. Modcity focuses on energy efficiency, as the other two criteria are often not financially feasible. All of Modcity’s multiplexes are CMHC-approved for energy efficiency, verified through rigorous, up-to-date energy modelling by specialist engineering firms.

For joint ventures and client projects, Modcity performs and coordinates all necessary energy analyses to maximize the project’s score, balancing cost and feasibility, and subsequently organizes the submission to CMHC to secure optimal takeout financing.

Learn more about the CMHC MLI Select program here.

How do Modcity construction contracts work?

Modcity is a fixed-price builder, offering a guaranteed price with no hidden fees, unexpected costs, or budget overruns, covering every aspect of multiplex construction from start to finish. Our guaranteed price includes all costs for materials, labour, site supervision, and project management, ensuring your investment is protected from day one with no surprises as the project progresses.

We stand firmly by our timeline commitments, recognizing that execution speed is critical for any development project. In the event of a delay, Modcity will cover all mortgage costs for every month beyond the promised timeline. We pride ourselves on eliminating construction risk for everyone who collaborates with us, whether as a co-investor or a client.

Are Modcity build warrantied?

We offer a generous warranty matched to Tarion standards (1-, 2- and 7-year coverage), providing peace of mind long after construction is complete and the units become occupied.

1-Year Warranty: Covers workmanship and materials, including plumbing, electrical, and HVAC.
‍2-Year Warranty: Covers building systems and water penetration issues, plus code compliance.
‍7-Year Warranty: Covers major structural defects affecting the home’s integrity.

Modcity Construction Ltd. is a licensed builder, in good standing since initial registration, with the Home Construction Regulatory Authority (HCRA) in accordance with the Ontario New Home Warranties Plan Act, R.S.O. 1990, c. O.31 and the regulations promulgated thereunder; the New Home Construction Licensing Act, 2017, S.O. 2017, c. 33, Sched. 1, and theregulations promulgated thereunder, and any other applicable legislation and/or regulations.

Learn more about Tarion warranty coverages here.

Do I need to pay development charges for a multiplex?

As of June 2025, landowners can build a fourplex or sixplex, along with a garden or laneway suite, while being fully exempt from development charges. This exemption is a key factor in the profitability and financial feasibility of these projects. Fourplexes are permitted as-of-right across all Toronto wards, while sixplexes are allowed as-of-right in the eight Toronto and East York Community Council wards (Wards 4, 9, 10, 11, 12, 13, 14, and 19) and Scarborough North (Ward 23).

This regulatory change can save a multiplex developer up to $315K* in fees for a single lot, which contributes directly to profit and significantly enhances project feasibility while the development charge waiver remains in effect. We strongly recommend taking advantage of these favorable policies while they remain in place.

*A 3-bedroom unit would incur approximately $45,000 in development charges, equating to about $225,000 for a 4+1 project and $315,000 or more for a 6+1 development.

Does Modcity recommend going through the Committee of Adjustments?

Modcity has always gone to the Committee of Adjustment for every one of our fourplexes and sixplexes to seek minor variances for a larger building envelope, unlocking the full potential of each lot. Even though these projects are as-of-right, zoning bylaws remain restrictive, with limitations on minimum side yard setbacks, maximum height, minimum landscaping requirements, and more.

The Committee of Adjustment process adds approximately three months to the permitting timeline; however, bypassing the hearing to accelerate approvals and accepting an inferior building footprint is a poor tradeoff, especially when a seven-figure investment is at stake.

Modcity coordinates all Committee of Adjustment submissions, strategy, and representation to maximize the likelihood of approval. As an expert in the process, Modcity has secured substantially more fourplex approvals with aggressive variances than any other builder. We collaborate with best-in-class planners and lawyers to ensure every application is positioned for success.

Should I develop a new-build project or do a major renovation?

Modcity focuses exclusively on ground-up new builds for several reasons. In Toronto, where many homes are approaching a century in age, retaining legacy foundations, wall assemblies or utility services is unwise, as it introduces structural uncertainty, increases complexity, and raises the risk of cost overruns while compromising quality, all of which can lower appraisal values and lead to costly durability issues over time.

New construction provides a clean slate, enabling optimized interior layouts, higher ceilings, superior durability, and predictable execution from concept to completion. Total hard costs for new builds have consistently proven competitive with major renovations, typically around 10 percent higher at most, and can be cheaper in complex retrofit scenarios.

Lenders, appraisers, and tenants also prefer new builds, and landowners benefit from comprehensive new home warranties covering structure, mechanical systems, and finishes. For liquidity and resale, the price is substantially higher for a new build, with purchasers and investors who buy a complete building demanding a low-risk property.

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