You beat me to it Marcus CLS! I just noticed they had begun digging the trench yesterday. This is a shot from the City Hall rear parking area looking South West:
Here's the view from Lisgar looking South East:
The concrete trenches they are using to shore up the ground at the surface:
A shot looking due West from Cartier street. As far as I can tell, the parking lot in the foreground will remain a parking lot for now. Although, I'm pretty sure another condo will be going up there within the next 5 years.
I've also included a YouTube video I took to show the scale of the project. Basically, it's going to be HUGE. The buildings in the background are about 10 or eleven stories and the Merit is going to be 20 stories, so twice a tall: http://www.youtube.com/watch?v=O5jrOTKfYkk