A proposed $800 million European spa and water park seeking city subsidies in the Cedars area of Dallas might not be all that it appears.
Austrian spa company Therme turned heads last month when it said it was buying 24 acres at 1500 South Riverfront Boulevard from Matthews Southwest for the resort. The news sparked speculation that the tide is turning for an underutilized section south of downtown near Rock Island and the Longhorn Ballroom.
But a New York Times investigation into Therme’s publicly subsidized resort development in Toronto revealed that Therme has misrepresented itself in publicity campaigns and that it misled the government in Ontario about its experience in developing resorts.
In its 2019 pitch for the Toronto project, the company said “Therme Group has proven the success of its concept with six globally placed facilities under operation.” That turned out to be false, and it later walked back the claim.
In its pitch for Dallas, the firm touted locations in Bucharest, Romania, and Germany. However, the Times reported that Therme has only built and operated one spa, in Bucharest. The other locations are actually owned by a different company with the same name and logo.
“A company representative said Therme’s wording could have been more precise, and that references to its success in Germany were meant to communicate that the concept of Therme had been successful, because of [its] track record in Germany,” the outlet wrote.
In Dallas, Therme has pitched spending $500 million on construction and $300 million on design fees and interest.
Auditors in the Toronto development found that Therme was only worth about 1 million Euros, or $1.1 million. Its main backer is Austrian company A-HEAT, which specializes in heating and cooling.
Major players in commercial real estate have also invested in Therme, which has also pitched resorts in Washington, D.C., Manchester, England and Dubai.
New York-based real estate investment firm Sculptor Capital Management invested $250 million into Therme’s stalled project in Manchester. And another New York firm, The Georgetown Company, purchased a 25 percent equity stake in the Therme’s U.S. business.
Here’s what happened in Texas real estate this week.
In election news, Elon Musk got his company town in South Texas. The controversy over Henry S. Miller Company’s redevelopment plans for the Pepper Square shopping center in Far North Dallas pushed a local city council race to a runoff. And voters in Frisco rejected plans for a $340 million publicly funded performing arts center.
In the Texas Legislature, lawmakers struck a deal for sweeping property tax cuts. And they want to give the governor the power to ban foreign real estate buyers.
Neiman Marcus’ downsizing is putting office-to-residential conversion in play for an overlooked pocket near Uptown.
The buyer of Dallas’ aging Fairmont Hotel was revealed.
A judge ordered the HBO-famous “King George” to pay $23 million to the would-be buyers of his massive Texas Renaissance Festival in a botched $60 million deal.
Alamo Manhattan is planning more highrise apartments in Uptown Dallas. While Black Stone Builders is planning a luxury condominium highrise in Houston’s Montrose neighborhood.
And entertainment concepts are backfilling two vacant Sears stores in Texas, indicating that fun, not fashion, could be the future of the big box.
—Rachel Stone
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