I don't think Toronto is losing its ethnic communities, except in the just-outside downtown areas, where house prices are now astronomical and immigrant families can't afford. In the suburban apartment complexes in Rexdale and Scarborough there's still plenty of ethnic communities.
Adam Vaughan made an interesting point on a podcast done by the Reading Toronto site: that the city shouldn't simply look at fitting one million more people into it, it should instead look at trying to create 250,000 new three-four bedroom houses where families can live, and not simply studio-one-two bedroom condo complexes for urban professionals. He made the point that family housing carries with it things like schools, parks, libraries, all the things that make a true community.
Course, I'm guessing those houses would still be priced pretty damn high! And I'm having a hard time trying to figure out where you can build them in the old city of Toronto, the only thing I can see is allowing as-of-right tear downs/additions of the old one story post-war bungalows in the former East York, Etobicoke, and Scarborough in favour of three-three-and-a-half storey houses. But that'd be messing with the promises made that the new OP would not mess with established neighbourhoods.
