Less than two weeks before Infrastructure Ontario agreed a controversial lease with Therme at Ontario Place, the government was urged to “dig a bit deeper” into the private company’s finances.
New emails, obtained by the Ontario NDP through the legislature’s public accounts process, offer fresh insights into an incident flagged more than a year ago by the auditor general.
Back in 2024, a report from the auditor general found that 12 days before the Ford government and Therme agreed on terms, a senior civil servant pointed out Therme had low liquidity, low equity value, and that its financial strength appeared weak.
The language in the email, now unearthed by the opposition, was stark.
“I also think the big takeaway from me is to try to dig a bit deeper to confirm the financial performance of their existing spas, as right now I don’t really have a sense of their true financial performance,” the adviser wrote on April 21, 2022.
The partially-redacted message suggested officials look more closely at the number of employees the group had, a figure they suggested “seems very low.”
The civil servant also pointed out questions about low liquidity, income and cash flow that needed to be addressed.
Despite the questions, Infrastructure Ontario signed the lease with Therme on May 3. There were just eight working days (and 12 total) between the message, which flagged concerns, and the agreement being completed.
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“Infrastructure Ontario knew 12 days before signing the deal with Therme that they were broke,” Ontario NDP Leader Marit Stiles said.
“What happened in those 12 days? Why is it that they didn’t revisit this deal?”
It’s not clear from the documents whether Ontario was able to get answers to the concerns raised by the adviser in the time between them being posed and the lease being finalized.
The auditor general asked Infrastructure Ontario that question in 2024.
“IO noted that Therme’s project at Ontario Place is expected to require Therme to either raise capital for the project or arrange third-party financing,” the report said at the time. “This situation is recognized in the lease.”
Stiles is skeptical the government could have sought answers in that time.
“Why didn’t the government do the due diligence they’re supposed to do to make sure Therme was not broke?” she asked. “Unfortunately, this was flagged, and they still went ahead.”
A spokesperson for the Ontario government said Therme had met its requirements, including the financial assessment of having a $100 million net worth.
“Every submission through the call for development process for Ontario Place underwent thorough evaluation and financial review,” they told Global News in a statement.
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“As part of this thorough review process, an analysis of audited financial statements demonstrated that Therme met the financial net worth test required, which was confirmed by the Auditor General.”
Therme did not respond to questions from Global News ahead of publication.
Questions have been repeatedly raised about Therme’s agreement with the province, terms included in the lease and who else bid for the public land.
Previously, the auditor general found Infrastructure Ontario had failed to properly assess Therme’s application in a report released at the end of 2024.
“We found that IO did not conduct due diligence to ensure that spas cited by Therme in its submissions were in fact owned and operated by Therme Group,” the auditor general wrote in a report.
“In its submission, Therme stated that ‘Therme group has proven success of its concept with six globally placed facilities under operation.’ We reviewed the six spas and found five instances where the spa cited in the submission was not owned or operated by Therme Group.”
In response to a New York Times story that highlighted those questions from the auditor general, a spokesperson for Therme previously said the story was “inaccurate and not new news.”
They said Therme “followed all the rules of the bidding process.”
Other concerns were raised about the unusual bidding process implemented for the redevelopment and the commitment Ontario has made to build parking spots for the facility.
The government is set to spend more than $2 billion to help get the spa underway.
This should have been a nail in the coffin of the project but since the AG delivered this report only a few days before Christmas and then the Cons went on a LONG break, it was forgotten.
this government is not for the people, it is for itself with our tax dollars. Call your MP’s daily to complain about what the PC Party is doing. Get ALL of your relatives and friends to call their MP. These fraudulent, corrupt officials need to answer to us, not their friends and family. 2 Billion dollars would go far in helping Ontario’s tax payers.