Sidewalk Labs has arrived at initial agreements with external financing partners and is in discussions with the Canada Infrastructure Bank (CIB), a federal department responsible for public infrastructure, about the company’s prospective Quayside development, according to an internal document obtained by The Globe and Mail.
“We’re very aware of every conflict of interest law and rule that actually exists, and are scrupulous in terms of abiding by them.”
-Sidewalk Labs CEO, Dan Doctoroff
Sidewalk Labs sent a report to parent company Alphabet Inc. in November stating that it had finalized seed funding for some of its infrastructure plans, and had reached preliminary deals with private investors. In the report obtained by The Globe, the company also wrote that it had “discussed general capital structure with the [Canada] Infrastructure Bank.”
While public documents show that Sidewalk Labs intended to finance some infrastructure in the Quayside project, Waterfront Toronto’s board nor the Toronto City Council approved any of these plans. Many tangible details aren’t expected until an innovation and development plan is released to the public for discussion later this year. On a federal level, Waterfront Toronto reports to Infrastructure Canada.
In an interview with The Globe and Mail, Sidewalk Labs CEO, Dan Doctoroff, said the company was “far along” in generating an investment company to fund the project’s infrastructure. Doctoroff did not disclose the identities of any prospective investors, but he confirmed the company was in dialogue with CIB, adding that it could “conceptually play a role in financing infrastructure on the waterfront.”
Although Sidewalk publicly proposed various technologies that could be installed in Quayside, such as heated sidewalks and autonomous vehicle infrastructure, the company’s infrastructure plans have remained, for the most part, under wraps. Sidewalk’s first infrastructure priority is a light-rail transit line. Last week, Doctoroff said the company might pull out of the Quayside project altogether if transit is a no-go, adding that infrastructure could be a deal breaker.
“If there is no light-rail through the project, then the project is not interesting to us,” Doctoroff said in an interview with The Canadian Press last week. In that same interview, Doctoroff said Sidewalk Labs intended to only fund 10 to 15 percent of the overall project, but did not disclose how much infrastructure the company was planning to finance.
Government communications obtained by a freedom of information request from The Globe shows John Brodhead, a Liberal Party aide now working in policy and strategy at Sidewalk Labs, was engaged in negotiations with Waterfront Toronto before and during Quayside’s request-for-proposals.
According to The Globe, Broadhead helped in the creation of the Infrastructure Bank, when it was announced in finance minister Bill Morneau’s 2016 economic update. Broadhead was the chief of staff to then-infrastructure minister, Amarjeet Sohi at the time, and left the government in April, joining Sidewalk Labs shortly after.
The acquired correspondence suggests that Waterfront Toronto staff had discussed backing some of the infrastructure through the bank with Brodhead, before he joined Sidewalk Labs. Both Doctoroff and the Infrastructure Bank stated Brodhead had no involvement in Sidewalk’s conversations with the bank.
Sidewalk Labs said Brodhead’s participation in the discussions were “perfunctory,” adding that the discussions had no affiliation with the company. Six months after the Sidewalk Labs deal was approved, Brodhead was hired to oversee Sidewalk Labs’ policy and strategy, and his current duties include connecting Sidewalk’s development with influential figures.
Waterfront Toronto representative, Andrew Tumilty, confirmed the interactions between Waterfront and Infrastructure Canada to The Globe.
“Given its mandate to invest in public transit, economic development, and green infrastructure projects, the CIB presented an opportunity to investigate financing for a bundle of infrastructure projects on the eastern waterfront,” he wrote.
“We’re very aware of every conflict of interest law and rule that actually exists, and are scrupulous in terms of abiding by them,” Doctoroff said to The Globe.
Image courtesy Sidewalk Labs.
StartUp HERE Toronto is a publishing partner of Betakit and this article was originally published on their site.