INVESTIGATION: Developers with ties to Ford government stand to cash in on Hwy. 413

Eight of Ontario’s most powerful land developers own thousands of acres of prime real estate near the proposed route of the controversial Highway 413, a National Observer/Torstar investigation has found.

Four of the developers are connected to Doug Ford’s Progressive Conservative government through party officials and former Tory politicians now acting as registered lobbyists.

If built, the road will raze 2,000 acres of farmland, cut across 85 waterways and pave nearly 400 acres of protected Greenbelt land in Vaughan. It would also disrupt 220 wetlands and the habitats of 10 species-at-risk, according to the Toronto and Region Conservation Authority.

One developer, John Di Poce, employed the head of the Ontario PC party’s fundraising arm for several years and three other developers employ the chair of Caroline Mulroney’s 2018 PC leadership campaign as a government lobbyist. Mulroney is now Ontario’s transportation minister and will play a key role in future decisions about the 413 highway.

Another of the developers, Michael DeGasperis, hosted Ford and PC MPP Stephen Lecce in a private luxury suite at the BB&T Center in Miami to watch a Florida Panthers’ NHL game in December 2018. In a statement, spokespeople for Ford and Lecce said both politicians paid for their own tickets to the game and no government business was discussed.

That was shortly after the Ford government had resurrected the proposed 413 highway. The previous Liberal government had shelved the project in 2018 as concerns about urban sprawl and its impact on the environment grew.

The provincial government has handed down extraordinary directives in at least three instances since April 2020 to help fast-track development on lands owned by some of these major developers around the proposed highway.

In the past year, Ford’s government has signed controversial minister’s zoning orders (MZO) for two properties in Vaughan near Highway 400 close to the terminus of the 413’s route and a parcel of land in Caledon near a proposed interchange.

Most of the developers in the group are also prolific PC donors, contributing at least $813,000 to support the party since 2014.

The group of developers own 39 properties covering 3,300 acres that are conservatively valued at nearly half a billion dollars, according to land registry documents. The value of those lands could rise dramatically if the highway is built and residential, commercial and industrial development is allowed to spread along the route.

The developers include the Cortellucci, DeGasperis, Guglietti and De Meneghi families, John Di Poce, Benny Marotta, Argo Development and Fieldgate Homes.

The proposed 60-kilometre route of the 413 highway would extend northeast from Highway 401 near Milton looping around the built-up edges of the Greater Toronto Area (GTA) to Highway 400 north of Vaughan. It would pass through parts of Greenbelt land just south of the Oak Ridges Moraine, a protected environmentally sensitive area.

One study commissioned by the previous Liberal government estimated the proposed highway would save drivers a mere 30 to 60 seconds of driving time. The Ministry of Transportation contends that it would save drivers 30 minutes.

In an emailed statement on behalf of Ford, Mulroney and the transportation ministry, the premier’s spokesperson said the 413 highway is needed because “even with significant investments in transit, the major highways in York and Peel regions are all forecasted to be operating over capacity by 2031.”

“There is a very strong case for moving forward with this project when considering the forecasted population growth this region will experience in the coming years,” said Ivana Yelich, the premier’s spokesperson.

The highway, also known as the GTA West Corridor, is under increasing criticism from residents, environmental groups and, now, local governments who are questioning the need for a new road and a price tag estimated to be anywhere from $6 billion to $10 billion.

On Humber Station Road, just south of Bolton, the Muia family are among those waiting and worrying about the fate of the highway. The 413 hangs over them like a shadow, figuratively for now but perhaps literally some day.

The highway would pass right over the roof of the family house at the location of what will be the Humber Station interchange. Their two-acre property will become pavement and concrete, bridges and ramps.

Vince Muia is 86 and he wasn’t planning on going anywhere. “I hoped to pass away at my property,” he said.

When the highway was first conceived some two decades ago, it was meant to be part of a bypass that extended all the way to Fort Erie. Now, only the 60-km stretch from Milton to Vaughan remains.

The environmental concerns that have dominated discussion around the highway — rallying together citizens from across the GTA — are not new. The detrimental impacts to the GTA’s farmland, waterways and Greenbelt have been discussed for the past two decades — and that was, in part, why the project was shelved by the Liberals.

When the Progressive Conservatives revived the project late in 2018, they also pledged to review the environmental assessment (EA) for the highway, allowing for a more “streamlined process for assessing potential environmental impacts.” This would allow for early works along the highway route such as new bridge construction or expansion to begin before the completion of the EA, expected in 2022.

“The previous Liberal government prematurely cancelled the environmental assessment on the GTA West Corridor, never released the lands, and, as a result, left hundreds of landowners in limbo for years without any plan to alleviate congestion in the Greater Toronto Area,” Yelich said.

“Our government is doing the due diligence that was never done on this project by following through with the Environmental Assessment process, which is among the most stringent assessment processes in the country, to determine if the GTA West Corridor is a viable project for York, Peel and Halton regions,” Yelich added. “We are fully committed to the consultation process.”

Ontario’s NDP and Liberal leaders are both pledging to kill the 413 highway, saying it’s costly, harmful and unnecessary.

NDP Leader Andrea Horwath said Ford is “benefiting his developer buddies who in turn end up filling the coffers” of the PC party while Liberal Leader Steve Del Duca said the premier is “focused exclusively on rewarding billionaire Conservative donors.”

The findings of the Observer/Torstar investigation raise questions about why the 413 highway was resurrected by the Ford government shortly after it was axed, who stands to benefit if it’s built and why the government has taken such contentious steps to speed development along the route.

The land holdings uncovered in the joint investigation are just a snapshot of the total property ownership along the proposed highway route.

The search of land registry documents and corporation profiles focused on larger parcels of properties, many more than 100 acres in size, within five kilometres either side of the proposed route, as well as properties associated with major developers. A CFL football field including end zones is about two acres in size.

One of the developers who owns the largest number of acres near the proposed highway is John Di Poce, who is associated with Di Poce Management Limited and Di Poce Real Estate Holdings Limited.

The Observer/Torstar investigation identified 10 properties near the proposed highway owned by Di Poce’s companies covering 663 acres in total. More than half of the properties were near the village of Kleinburg and Copper Creek Golf Club.

“I’m in the building business. I sell houses,” Di Poce told the Globe and Mail in 2000. “I’m a private person and I don’t want to have anything to do with anybody.”

Di Poce declined to comment about his land holdings and ties to the Ford government.

For a number of years, one of Di Poce’s key contract consultants was Tony Miele, who simultaneously held the role of chair of the PC Ontario Fund, the party’s fundraising arm, a role he continues to hold.

Miele is a former president and CEO of the Ontario Realty Corporation (ORC), which managed the provincial government’s real estate portfolio until 2011 when it became part of Infrastructure Ontario. He was appointed to the position by Mike Harris, the former PC premier, and resigned from the ORC in early 2006.

On March 28, he sent an email to donors imploring them to help the party raise more than $46,000 in four days “to ensure that Doug Ford has the largest war chest of any party in the next election.”

The relationship between Miele and Di Poce dates back to the late 1990s when Miele was a manager for the Canada Lands Company, a federal version of the ORC.

In Nov. 1997 in his role with Canada Lands Company, Miele oversaw the sale of 30 acres of federally owned land across the street from the Chrysler assembly plant in Bramalea to Di Poce’s company for $58,000 an acre.

A month later, Di Poce flipped the property for $165,000 an acre. How did he do it? “Luck, nothing but luck,” he said at the time.

After leaving ORC, Miele became a consultant for Di Poce’s company.

In an emailed statement, Miele stated he was a contract development consultant for Di Poce until 2016 and his role “did not involve any discussions whatsoever on the proposed Highway 413.”

Another prominent developer with more than 600 acres of property near the proposed highway is the Cortellucci family, which owns Zancor Homes, Fernbrook Homes and other real estate development companies under the Cortel Group umbrella.

The Cortelluccis are also known for their philanthropy. In 2019, the family donated $40 million to the new hospital in Vaughan at a gala event attended by nearly 1,000 people, including Ford.

In 2019, Ford relaxed the naming policy for Ontario hospitals, making it easier for hospitals to recognize benefactors. In 2020, the hospital was renamed the Cortellucci Vaughan Hospital.

A Cortellucci-owned banquet hall, now called the Riviera Event Space, ⁠has also been the venue for a variety of political fundraising events. Premier Doug Ford’s brother, the late Toronto mayor Rob Ford, hosted a $300-per-plate fundraiser at Riviera in 2014.

The family has also found itself at the centre of controversy in 2018 when Cortel Group founder Mario Cortellucci ran for a seat in the Italian Senate alongside a coalition of right-wing parties who called for, among other things, closing Italian mosques and removing migrants from the country. At the time, Cortellucci’s campaign manager said he “comes from an immigration family” and is a “strong believer in immigration.”

Mario Cortellucci arrived in Canada in 1962 and started working in construction in the '70s. As children growing up in a small Italian village, Mario and his brother Nick ⁠— also a developer ⁠— would sift through sand and stone by the river, he told the Vaughan-based luxury lifestyle magazine Dolce in 2012.

“He taught me things like vision, and how to plan for the future,” Mario’s son and Cortel Group vice-president Peter Cortellucci said of his father at the time. “You don’t plan for the next couple of months, you plan for the next 10 years.”

Peter Cortellucci did not respond to repeated requests for comment on Cortel Group and his family’s land holdings, political donations and views on the proposed highway.

Two of the major GTA land development families — the DeGasperis and Guglietti clans — come from the same town in central Italy and are related by marriage.

The Guglietti family is known for Melrose Investments Inc., Rosehaven Homes and Tamarack Lumber.

Companies associated with members of the Guglietti family own at least six properties with a combined total of nearly 500 acres close to the proposed 413 highway.

The Gugliettis did not respond to multiple requests for comment sent to Melrose Investments.

Patriarch Giovanni Guglietti, who died in 2009, came to Canada in 1952 at the age of 17, and in 1961 he married Concetta DeGasperis.

Her three brothers — Fred, Tony and Angelo DeGasperis — had started Condrain, an infrastructure company, in 1954.

There are two main branches of the DeGasperis family holdings.

One arm descends from brothers Fred, Tony and Angelo, with businesses such as Metrus, Condor, DG Group, Aspen Ridge Homes and Vineland Estates winery.

The other arm descends from a cousin, Giovanni (John) DeGasperis, and includes Arista Homes and a variety of TACC corporations — an acronym for The Amazing Construction Company.

John’s son Silvio DeGasperis, who owns TACC Construction, has fought against restrictions on development in southern Ontario for more than 15 years, beginning with the previous Liberal government’s 2004 decision to protect the Greenbelt. The move effectively ruled out his plans to develop nearly 1,000 acres of farmland in Pickering, east of Toronto.

A 2006 profile in the Toronto Star called Silvio a “fast-talking, well-dressed” developer who, despite standing five feet eight inches, “casts a large shadow in Greater Toronto.”

“I’m a relatively small player,” he said at the time, when it was estimated he was grossing $650 million per year.

“But if you push me around, I’ll push back.”

On Dec. 28, 2018, the Florida Panthers took on the Montreal Canadiens at the BB&T Center in Miami. Michael DeGasperis, Silvio’s younger brother, played host to Doug Ford and Stephen Lecce in the DeGasperis family’s luxury box. Lecce — who had not yet been named education minister — represents the King-Vaughan riding, where DeGasperis’ Arista Homes is based.

Companies connected to the DeGasperis family own three properties with a total of 168 acres near the proposed highway, as well as five properties owned jointly with other developers. Messages left for Michael DeGasperis and TACC went unreturned.

The DeGasperis family’s main TACC corporation, Burlington-based Argo Development and a company associated with Fieldgate all employ former federal Conservative MP Peter Van Loan as a lobbyist registered with the Ontario government. When asked what he aims to influence in his lobbyist registration for TACC Developments, he states “Impact of proposed highway on Client’s lands.”

Van Loan was the government house leader under Stephen Harper from 2011 to 2015. He was also the chair of Caroline Mulroney’s 2018 failed campaign for the leadership of the Ontario PC party. Mulroney’s spokesperson said Van Loan has never lobbied the minister regarding Highway 413.

Van Loan is a former president of the Ontario PC party and from 2015 to 2018 he was the director of candidate training and recruitment for the provincial PCs.

Van Loan did not respond to requests for comment.

In addition to Van Loan, two of the DeGasperis family’s companies employ former PC MPP Frank Klees as a registered lobbyist. His lobbying goals, according to his registration, are focused on several matters, including highways, housing and infrastructure.

Klees, Ontario’s transportation minister in 2003, said Highway 413 “has never been a subject of discussion with provincial office holders on behalf of either Condor or DG Group.”

The De Meneghi family, which runs Lormel Homes, owns 234 acres close to the 413 route in Vaughan. Elvio De Meneghi, a principal at the company, didn’t respond to multiple requests for comment.

Amir Remtulla, chief of staff for the late Rob Ford, lobbied on behalf of Lormel Homes from Sept. 2019 to July 2020. He was also employed by TACC Construction as a lobbyist from Nov. 2019 to Oct. 2020. Remtulla didn’t respond to requests for comment, but lobbying registrations indicate his work for both companies was focused on developments unrelated to the 413.

Argo Development employed Jim Burnett, a longtime Conservative campaigner, as a lobbyist from Feb. 2020 until early this year.

Burnett worked on Patrick Brown’s 2015 campaign to lead the Ontario PC Party and was an assistant to former PC leader Tim Hudak.

Burnett said he never discussed the 413 highway with the government or companies he represented as a lobbyist.

Developers donated to PC Party, Ontario Proud

Each of the developers donated to the Progressive Conservatives. Three also gave to the third-party conservative group Ontario Proud.

About $753,000 went directly to the party, with another $60,000 to Ontario Proud.

Many also donated to other parties, but those contributions totalled far less, with about $350,000 going to the Ontario Liberals and nearly $28,000 to the Ontario NDP. The vast majority of the donations to other parties were also made before the PCs formed government in 2018.

While names match, the Observer/Torstar investigation cannot independently verify they are the same people. Observer/Torstar reporters sent the donation records to the developers and they either did not respond or did not dispute them. Common names and people who donated less than $500 were excluded.

The DeGasperis family led the way. The family members, their companies and senior staff have donated $332,265 to the PCs since 2014. They contributed $157,756 to the Ontario Liberals and $27,507 to the Ontario NDP.

TACC Developments is also part of Nashville Developments, a consortium of developers that includes Fieldgate and donated $50,000 to Ontario Proud in 2018.

“It just shows you how much the Highway 413 project is about benefiting land speculators who donated a lot of money to the (PC party),” Ontario Green Party Leader Mike Schreiner said of the donations found by the Observer/Torstar investigation.

Lobbying in Ontario is often about building relationships, said Dan Gold, who recently completed his PhD at the University of Ottawa on how lobbying influences decision making in Canada and the United States.

“It’s not about bribing a politician, it’s about finding a candidate who is receptive to your position, and helping them get into office,” said Gold. “In some way, it’s more insidious, because it’s not just one decision but finding an elected official whose viewpoint aligns with yours.”

He said the donations that developers give politicians “don’t buy you the outcome you want, but they buy you access.”

Asked about donations and the role of lobbyists, Ford’s office did not directly respond.

'The profit margins are astronomical'

Access to transit drives up land values.

“The on and off ramps really are going to be the driving factors,” said Keith Lancastle, CEO of the Appraisal Institute of Canada, which analyzes real estate values. “That’s where I’ve increased access to the properties nearby.”

The combined purchase prices for the properties associated with the major developers in this snapshot total $450 million.

But three-quarters of the properties identified have been held by the developers for more than a decade and more than half of them were purchased before 2004, which suggests their value could have grown dramatically.

Even if the highway is approved and built, it could still take years before development of the farms and open land is permitted and proceeds.

It’s typical for developers to buy up properties around the fringes of cities and hold them as farmland for long periods, speculating they will eventually be included in the urban boundary.

If a highway or other form of mass transit is also approved, the land is worth dramatically more, according to Victor Doyle, a former Ontario government planner.

“The profit margins are astronomical,” said Doyle.

“So if any developer speculatively bought land in Caledon and Vaughan, then developers are going to be pushing for the highway to no end, because they stand to benefit even more so from their investment.”

Doyle worked as a government planner when the province was mulling the 413 before shelving it in 2018. He said despite years of studies, a three-person panel commissioned by the Liberals found the highway was not the best solution to GTA’s gridlock problem, and suggested highway expansions and better use of the nearby Highway 407 instead.

“I think the reinvigoration of the 413 under the Conservatives can be directly attributed to the development industry,” said Doyle, who has been credited as one of the architects of the Greenbelt.

Developers push municipalities to expand the urban boundary in their official plans, Doyle said. Despite an ongoing pandemic, and opposition from some GTA-area municipal councils, the province has given municipalities until next summer to update their official plans to 2051.

“The minute the Minister of Municipal Affairs signs an official plan which expands the urban boundary, the value of that land goes up dramatically,” he said.

In Ontario, land zoned for employment land is going for $1.9 million per acre in 2021, according to CBRE Group, a commercial real estate services firm.

For now, the highway remains a proposal, zoning changes are merely forecasted in official plans, and many of the lots remain agricultural.

None of that seems to have dented the value of land near the planned 413.

A 98-acre lot at 14275 The Gore Road in Caledon sold for $3.8 million in 2008. In May 2019, the farmland, located about four km north of a proposed 413 interchange, was bought by a company connected to the principals of Argo Development for $40 million.

Special orders fast-tracked development near the 413

While city councils can revamp their official plans, such changes can take years to materialize.

The province has a way for developers to skip the wait. They’re called minister’s zoning orders, or MZOs, and the Ford government has used more of them since 2018 than the previous government did in 15 years.

The orders — made by Ford’s Municipal Affairs Minister Steve Clark and in the face of mounting criticism — are unappealable.

“We will never stop issuing MZOs for the people of Ontario,” Ford said on March 9.

Three Ford government MZOs cleared the way for projects near the 413.

One issued in Vaughan in April 2020 approved developers’ plans to demolish three protected wetlands where development is normally forbidden, and replace them with a massive Walmart distribution centre. The land sits near the point where the 413 would join Highway 400.

The province had previously classified the wetlands as “provincially significant,” a title given to places the government deems most precious. Often they control floods or are home to rare species.

The developers struck a deal with the province and the local conservation authority to build new wetlands nearby as a replacement.

The project broke ground in August 2020.

A photo of the event shows Condor founder Angelo DeGasperis standing alongside Ford, three of Ford’s cabinet ministers, two local politicians, the CEO of Walmart Canada and the president of the development company Muzzo Group.

They all held shovels.

The warehouse’s construction, set to be done in 2024, was endorsed by the local council. It was opposed by environmentalists, who said the MZO was a “deeply troubling precedent.”

On the other side of Highway 400, less than two kilometres away from the proposed interchange with the 413, a November 2020 MZO rezoned farmland to become the future site of five neighbourhoods. Among the developers participating: Lormel Homes, Fieldgate and TACC Developments.

Environmentalists, who are opposed to such developments located next to the Greenbelt, say it paves over a carbon sink, hampers Ontario’s ability to grow food locally and increases emissions-intensive urban sprawl.

The plans for the development include stipulations that there be a “net positive environmental outcome.”

The Ford government used an earlier MZO in July 2020 to approve a housing development in Caledon, located on land near a proposed 413 interchange. The project was proposed by a group of companies that includes Nick Cortellucci’s Brookvalley Project Management and Fieldgate.

The project, in the works for about a decade with the backing of Caledon council, had been postponed due to the Liberals’ decision to shelve the 413.

Another MZO request by Cortel Group, which would rezone land just north of the Walmart warehouse if approved, is under consideration by Minister Clark.

The 195-acre property includes valleys, forests and provincially significant wetlands, according to a Toronto and Region Conservation Authority staff report.

In a letter to Vaughan council last year asking for city support for the MZO, Cortel cited the 413: “The lands are located along a major north-south transportation corridor (Highway 400) which will connect directly with the proposed new GTA West Corridor. These lands therefore have very significant strategic importance in the GTA and in the province for the movement of people and goods throughout Ontario.”

'What are you going to do, leave the house and live underneath the bridge?'

Those who are now fighting the highway for a second time in three years say there’s a grassroots feel to the opposition this time.

In February, environmental law charity EcoJustice asked the federal government to take over the environmental assessment of the highway. The federal government is expected to make its decision some time in early May. It’s a decision that many believe could kill the project.

In the meantime, almost all of the municipalities impacted by the highway — and who have long backed it — have pulled their support for the project, including Vaughan, King City and Halton Hills. Brampton and Caledon have endorsed the request for federal oversight.

Back on Humber Station Road, the Muia family has started looking for a new place to live in case the highway is approved. A lot of real estate agents have been knocking on the door lately.

Vince, 86, and his 84-year-old wife moved out of the Jane-Lawrence area of Toronto 22 years ago to get some breathing room.

Sam, 57, moved back in three months ago to help his parents. Together, they’re trying to figure out what they should do.

His parents want to stay in the same area if they’re forced out, and they’ve looked at some properties, but all of them are selling for up to $500,000 over the asking price, Sam said.

“They say they’re not moving,” Sam added. “I said ‘What are you going to do, leave the house and live underneath the bridge?’ Because there will be bridges all over the place here.”

—With files from Jesse McLean and Robert Benzie, Toronto Star