Critics are once again slamming the provincial government’s plan to build a luxury spa on the former site of Ontario Place — this time over allegations that the company set to run the multi-billion-dollar project misrepresented itself and exaggerated its experience in order to secure the deal.
Those claims are part of a New York Times story published Wednesday, which expands on concerns outlined in a provincial auditor general’s report from late last year. The story alleges Therme had falsely represented itself as operating more spas in Europe than it actually was, alongside losing money at the time it was pitching its vision for the prime Toronto lakefront property.
At Queen’s Park Wednesday, Liberal MPP John Fraser said the story was “stunning,” as it showed a company with one small spa, a million dollars in equity, and an “interconnected web of shell companies.”
“Yet somehow they convinced the premier that they had a global track record. It didn’t just stretch the truth, it led the premier down the garden path — and Infrastructure Ontario signed right off on it,” Fraser said.
“So why did the premier greenlight a 95-year-deal with a company that inflated its portfolio and couldn’t pass a basic financial sniff test?”
In a statement sent to CBC News, a Therme spokesperson noted that the auditor general’s December report said the lease between the company and the province included a financial test. The report goes on to say that an Infrastructure Ontario (IO) examination of the company’s audited financial statements showed it to have a net worth of $100 million.
The auditor general’s report also notes, however, that a senior adviser at IO had financial concerns about the company — namely that it had low liquidity, and prior to the end of 2019, the group’s equity value “appeared low,” at less than a million Euros.
The auditor general’s report goes on to say that IO “did not conduct due diligence to ensure that spas cited by Therme in its submission were in fact owned and operated by Therme Group.”
“We reviewed the six spas and found five instances where the spa cited in the submission was not owned or operated by Therme Group,” the report reads.
Ontario Place redevelopment not ‘fair, transparent or accountable,’ auditor general finds
In the company’s statement to CBC News, Therme said it currently operates locations in Romania and Germany, which “welcome more than 3.5 million visitors every year.”
Therme also attributes the discrepancy over the number of spas it operates to a collaboration with the Wund Organization, with the architectural, engineering and operations teams behind both businesses playing “a central role in designing and building the European Therme destinations.
“Following Mr. Wund’s passing, this expertise was consolidated within Therme Group, where many of the original team members have continued to work for nearly a decade,” the statement reads. “This collaboration partnership was formalized in 2019.”
At an unrelated news conference Wednesday, Premier Doug Ford said provincial officials would “look into” the allegations in the New York Times story and make sure the circumstances surrounding the deal are legitimate.
“We’ll look into it and make sure everything passes the smell test,” Ford said.
In response to Fraser’s question about the project at Queen’s Park, Minister of Infrastructure Kinga Surma noted that Therme passed the financial test conducted by Infrastructure Ontario, which she called a “world-renowned, arms-length agency.”
Pressed in further questions, Surma repeatedly pivoted to talking about the number of jobs that would be created both through construction and operation of the spa.
Surma also said the province has “done this dance already,” when it comes to questioning the project, mentioning audits and a recent review.
In its report from last December, the province’s auditor general found that the cost of the redevelopment of Ontario Place had ballooned by more than $1.8 billion, and the process for selecting new tenants for the property wasn’t transparent or fair.
Fraser asked Wednesday if Premier Doug Ford would throw out this deal, like he did when he cut ties with Elon Musk’s Starlink, or when the province backed away from its redevelopment plans for The Greenbelt.
“No, we will not,” Surma responded, again lauding Infrastructure Ontario’s credentials.
Green Party Leader Mike Schreiner, however, called on the province to do exactly that, in addition to exploring a “made in Ontario solution” for the space.
“The people of Ontario want to access Ontario Place as a public space — not some privatized space for … a foreign-owned company that’s barely solvent,” he said.
