At the tail end of the town council meeting on March 19, Flower Mound Mayor Melissa Northern was prompted by Town Manager Harlan Jefferson to read an email from a resident.
The resident requested the town share information on a recent legal matter of an affiliate related to Realty Capital Management, the master developer of Lakeside DFW. The resident also requested information regarding the emergence of Lakeside DFW Land Ltd. (owners of the property) from bankruptcy.
“We are very proud of the track record of the Realty Capital team, Lakeside DFW Land Ltd., and the Stewart Family,” said Peter B. Stewart, president of Lakeside DFW Inc., the general partner of Lakeside DFW Land Ltd.
“We believe Flower Mound is fortunate to have community-minded people working on this important project,” he said. “Very quickly, Realty Capital won’t be alone. Soon they will bring in more such community-minded developers who are renowned in specialties, such as retail, restaurant, residential, and office projects.”
“Our family and our new partners selected the team at Realty Capital because of their sterling reputation over 25 years in developing upscale projects in the suburbs around Dallas and Fort Worth,” Stewart commented.
In December 2011, Hillwood and Realty Capital formed a joint venture to develop Belmont in Argyle.
“We concluded that they had the most expertise to serve as the master developer of this complex project. They also shared our vision and passion to create a mixed use destination on Lake Grapevine.
“We reviewed the lawsuit in detail and discussed it with Richard,” Stewart explained. “We view this as another real estate project that didn’t get funded during the recession. Every project comes with some risk.
“The Realty Capital team has done business with literally thousands of entities over their 25-year history,” he emphasized. “They have had to deal with just a handful of cases of litigation and never had a judgment against them until this case.
“That’s a very good track record in my book,” he added, “especially when juries often favor an individual over a corporate entity.”
The judgment is being appealed. Click for more on Realty Capital.
Lakeside DFW Land Ltd.
The Stewart Family has owned the property now known as Lakeside DFW since 1973. The first serious attempts to develop the property began in 1994.
A number of factors – including delays related to zoning issues, the 2008 financial crisis, and the subsequent recession – conspired to force Lakeside DFW Land Ltd. to seek bankruptcy protection in September of 2010.
“We needed to protect the property while we figured out the best way to structure its future,” Stewart said. “Bankruptcy is the institution made specifically for that purpose.”
Bankruptcy law prevented Lakeside DFW Land Ltd. from paying any creditors until a final settlement with all the creditors was reached.
The Town of Flower Mound, which was owed $138,191.33 in January 2011, was repaid with interest in September 2011.
Several town officials have brought up the Lakeside DFW Land Ltd. bankruptcy in public forums since the beginning of 2011 when the council unsuccessfully attempted to prohibit application of the Mixed Use Ordinance to Lakeside DFW (the property for which it was created).
“We don’t know why they would bring it up so often unless they hoped to discredit the land owners and/or developers,” Stewart shrugged.
“During our nearly 40 years in Flower Mound, we have consistently tried to add value both to Flower Mound and to our property,” he said. “What else can you ask for in a landowner and developer?”
“We also are proud to be the only property owners in the Lakeside Business District to have emerged from bankruptcy,” he said. “If we had failed, the property may well have been sold off in pieces to the highest bidders. That would have created a mess for the town and wasted a golden opportunity.”
“Many in the real estate community,” said Jimmy Archie, managing director of Realty Capital, “were amazed that the Stewart Family succeeded in attracting additional capital to help them emerge from bankruptcy protection and prevent foreclosure.
“That is highly unusual in our world.”
“We stuck it out,” Stewart said, “because we believe in Flower Mound and we want to see this property blossom into something very special.”
“Now,” Stewart insisted, “it’s time to pump a lot of activity into the area and a lot more revenue into the town’s coffers.”
The zoning application under the Mixed Use Ordinance features public trails and parks with lake views, high quality dining and shopping experiences, high quality housing options not found elsewhere in Flower Mound, and office development. It is designed to serve as a magnet for all kinds of activities and for people from all over North Texas. (Click for concept plan.)
Projections suggest that, upon completion in about 10 years, the 150-acre project should be worth $1 billion.
“Residents should know the people who are proposing to make such an important investment in Flower Mound,” Stewart insisted, “and we’re proud for them to take a long hard look at us.
“They also should know,” he added, “that the town’s Mixed Use Ordinance will ensure quality development at Lakeside DFW, even if everyone at Realty Capital is hit by a truck.
“From this point forward, town officials should consider taking their cue from Flower Mound residents,” Stewart suggested. “Residents want Lakeside DFW to help improve their quality of life here in Flower Mound.
“They are growing impatient with delays.”