07/14/2015 05:14 EDT | Updated 07/14/2016 05:59 EDT

Toronto will spend $5M to study of re-routing Don River

Mayor John Tory announced new money for a "transformational project" that could eventually change where the Don River empties into Lake Ontario, making way for a redeveloped Port Lands area.

Redeveloping the 880 acres of space near Toronto's Port Lands, which could eventually cost billions, is currently hindered by the flooding risk posed by the river. Re-routing the flow of the Don could allow many of the projects to move forward.

Tory, who was joined by Ontario's Minister of Economic Development Brad Duguid and federal Finance Minister Joe Oliver for the announcement, said the city will spend $5 million to do an environmental assessment on re-routing the river. That study should, he said, provide a firm number which the city and other governments can divvy up.

Tory said the "city is ready to invest in the Port Lands," but the due diligence will have to be done first.

Still, he said he'll be "impatient" for the redevelopment work — which will be lead by Waterfront Toronto — to begin.

The Port Lands plan includes a number of developments, including one at the site of the old Unilever factory that will in the future include a transit link for the SmartTrack plan.

Waterfront Toronto calls the Port Lands an "unprecedented future development opportunity," on its website.

Tory said it's uncommon for the city to get the chance to develop an area from the ground up and emphasized the potential economic and employment benefits of the project.

Oliver said the federal government will wait for the city study to come back before investing money in the project.

The city has been planning the Port Lands redevelopment since late 2011.