In 2016, with light rail infrastructure under construction, an adjacent dedicated bus station was announced.

It would be east of the rail line and accessed from Phillip Street, shifting some buses off Ring Road and onto public roadways.

[4] Later, in 2020, it was announced that over $3 million in additional provincial, federal, and regional funding had been granted for amenities at the new bus station.

The bus terminal was constructed on an existing access road between Phillip Street on the east and the University's Ring Road on the west, with a level crossing for the ION light rail line and the Laurel Trail at its western end.

The Bus Terminal's road continues westward onto the campus grounds as William Tutte Way, named after University of Waterloo mathematician W.T.