That whole stretch of Spadina north of Bloor is essentially fronted by detached/semi-detached homes and apartment buildings, so I wouldn't call this a wasted opportunity. If anything, I think this type of infill is an excellent model we should be following to fill-in the wasted expanse surrounding our ubiquitous "towers in the park". For example, the western stretch of Church St. just south of Charles would certainly benefit from a development like this (with some retail space at street-level).
edit: oops - looks like my ideas aren't so astute and novel after all, since urbandreamer beat me to the punch a while ago.