After Another Major Gateway Jax Incentive Vote, How Deep Did Jacksonville's Financial Due Diligence Go?

John Hawley

Sep 17, 2026

Financial Watchdog Jax- Part II focused on Jacksonville DIA Financial Due Diligence

This is Part II of Financial Watchdog Jax, a 101 Report series examining the financial structures, public safeguards and accountability systems surrounding Jacksonville's economic-development investments. Part I examined DLP Capital, Gateway Jax and questions surrounding one of Downtown's largest development partnerships. Part II turns the lens toward Jacksonville itself: what financial due diligence occurs before public resources are committed—and how taxpayers can determine afterward whether those investments delivered the returns originally projected.

One day after Jacksonville's Downtown Investment Authority advanced two more major Gateway Jax proposals, a separate financial document filed with the Securities and Exchange Commission provides a timely reason to examine how Jacksonville protects public money before committing it to private development.

On September 16, the DIA board voted 8-0 to recommend nearly $59.4 million in public incentives for Gateway Jax's proposed Riverfront Plaza Hotel & Residences. The package includes nearly $39.4 million in a 20-year REV grant and a $20 million completion grant. City Council approval is still required.

The board separately voted 7-0, with one abstention, to recommend a $15 million development loan at 1% for Hotel Merrydelle, another Gateway project. That loan is expected to be repaid and also requires Council approval.

Those aren't financially equivalent forms of public support. One returns a portion of future incremental property taxes, one is a completion grant and one is a loan expected to be repaid.

But each requires Jacksonville to make a financial judgment.

And that makes what happened before the votes increasingly important.

How deeply did Jacksonville examine not only these projects, but the financial organizations standing behind them?

Gateway Jax's Financial Structure Includes DLP Capital and JWB

Gateway Jax isn't a single developer operating alone.

The Jacksonville Daily Record identifies Gateway Jax as a partnership involving Bryan Moll, JWB Real Estate Capital and DLP Capital. DIA documents have also identified DLP- and JWB-related entities within Gateway's organizational structure.

That relationship makes DLP relevant to Jacksonville's public-investment decisions. It does not mean that questions involving another DLP property or investment establish a problem with Gateway Jax. They don't. But when Jacksonville evaluates the financial strength of a development partnership seeking substantial public assistance, an obvious institutional question follows: How extensively does the City's due diligence examine the financial organizations standing behind the project? That question has become particularly timely because of new financial disclosures involving DLP.

A New SEC Filing Offers a Window Into DLP Due Diligence

On August 26, an investment vehicle called the DLP Access Fund filed an amended registration statement with the Securities and Exchange Commission.

The proposed fund is advised by OneAscent Capital LLC, not DLP Capital, and proposes investing substantially all of its assets in private investment vehicles sponsored by DLP. That distinction makes the filing useful. It provides an example of how an outside financial organization says it intends to evaluate DLP before placing private investor capital into DLP-sponsored funds.

The filing describes due diligence involving underlying fund documents, financial information and DLP's management, track record and investment practices. It also addresses portfolio composition, leverage, liquidity and valuation. That's a substantial scope of examination.

Jacksonville isn't an investment fund, and DIA isn't an investment adviser. Their responsibilities aren't identical. But both make decisions involving capital and risk. In Jacksonville's case, those decisions involve public resources.

The SEC Filing Also Identifies Valuation Risk

The SEC filing discusses valuation as a particular risk.

Real estate, development projects and real-estate loans can be difficult to value precisely. The filing explains that valuations involve judgment and may rely upon appraisals, internal models and other methodologies.

That point is relevant because new reporting by Barry Minkow has raised questions about differing values associated with several DLP-related Texas properties.

Those claims require careful context.

Different valuations of the same property do not, by themselves, establish misrepresentation or wrongdoing. A tax valuation, lender appraisal, investment valuation and actual transaction price can legitimately differ because they serve different purposes, use different methodologies and may measure value at different times.

The 101 Report is therefore not making a determination that one valuation is correct and another is improper.

The SEC filing is also not an SEC finding against DLP. It is a registration statement containing disclosures about investment risks and proposed due-diligence procedures.

Indeed, the filing explicitly states that the SEC has neither approved nor disapproved the securities nor passed on the accuracy or adequacy of the prospectus.

The more useful Jacksonville question is narrower:

If an outside financial organization considers sponsor-level financial information relevant before investing private money with DLP, what level of sponsor examination accompanies Jacksonville's commitment of public resources to a DLP-backed development partnership?

Earlier This Year, DIA Found an Error in a Gateway Financial Model

Jacksonville already has firsthand experience demonstrating why additional financial review can matter.

Earlier this year, additional examination by a DIA board member identified an error in the City's financial model for Gateway's Publix-anchored N7 project.

The problem involved calculations using gross rather than net square footage for multifamily and retail rental income. Correcting it reduced projected net operating income and developer returns, although DIA staff concluded the correction did not change the City's projected return or recommended incentive amount.

Importantly, DIA's record indicated that this was a problem in the City's spreadsheet, not incorrect information provided by Gateway.

The episode wasn't evidence of wrongdoing by Gateway. It was evidence of why complicated financial models involving millions of dollars deserve independent examination. And DIA responded.

Colin Tarbert Moved DIA Toward Outside Financial Underwriting

DIA CEO Colin Tarbert didn't simply defend the existing process after the modeling issue surfaced.

DIA had already been working toward augmenting its internal underwriting with outside expertise. Tarbert subsequently told the board that financial consultants would be used going forward.

DIA then adopted a framework allowing it to recover costs associated with third-party financial underwriting for certain incentive requests.

The move represented a potentially significant strengthening of Jacksonville's financial controls.

DIA's existing underwriting rules are already detailed. Its 30-year ROI methodology for qualifying high-rise projects, for example, requires a minimum 1.1-times projected return and limits total City incentives to no more than 100% of qualifying developer equity. Outside financial analysis adds another layer. But it creates another transparency question: When is that additional layer actually used?

DIA Selected Three Outside Financial Specialists

The outside-consultant strategy wasn't generic. Tarbert reported that DIA received procurement approval for three financial-consulting teams with different specialties: CHM Warnick for hospitality; BJH Advisors/Foresight Street Advisors for mixed-use development; and PFM for municipal finance.

The structure makes sense.

A hotel requires analysis of occupancy, average daily rates, operating expenses and other hospitality-specific assumptions. A mixed-use development can combine residential, retail, parking, construction financing, equity and multiple revenue streams.Municipal finance raises still another set of considerations.

Outside specialists can potentially challenge assumptions that might otherwise remain inside a developer's pro forma or DIA's own model. But having consultants available isn't the same thing as knowing precisely when they were used.

Were Outside Consultants Used on the September 16 Gateway Deals?

That remains an important unanswered question in the publicly available records we reviewed.

The 101 Report found documentation establishing DIA's movement toward outside financial underwriting and the consultant structure.

We have not identified in the publicly available September 16 materials reviewed for this article a separate independent consultant report showing that one of those firms reviewed Riverfront Plaza or Hotel Merrydelle before the DIA board acted. That does not mean an outside review didn't occur.

It could have occurred without a separate report appearing in the records we've located. The question isn't whether DIA secretly skipped a required review. We have no basis for making that claim. The question is whether independent underwriting occurred, who performed it, what was examined and what conclusions reached the board before members voted.

Gateway Jax Is Only One Test of a Much Larger System

This is where the issue becomes larger than DLP.

Jacksonville has an increasingly complicated Downtown development pipeline involving developers, investors, lenders, operators and special-purpose entities seeking different forms of public participation.

Gateway itself involves JWB and DLP. Its Publix-anchored N7 proposal has involved another large proposed public package, including a REV grant and completion grant, while City Council has continued working through the structure.

But other developers are also participating in Jacksonville's incentive system.

Corner Lot, for example, is involved in multiple Downtown matters. Its completed Artea apartment development on the Southbank received a tax-rebate structure, and Tarbert described a proposal this year that would convert approximately $6.3 million of that rebate into a completion grant in exchange for designating 71 units as workforce housing.

Corner Lot and Aspect Real Estate Group are also connected to the proposed hotel and conference-center development at 330 E. Bay Street that would house the planned Culinary Institute of America campus.

The proposed CIA arrangement contemplates as much as $35 million in City support, including $8 million in workforce-development funding and $27 million from the Downtown Riverfront Residential Incentives Contingency Fund. A final development agreement has not yet been completed.

These examples don't suggest something is wrong with Corner Lot, Aspect, JWB or any other developer.

They demonstrate how many sophisticated private organizations can pass through Jacksonville's public-investment system.

Who Exactly Is Jacksonville Underwriting?

That's the larger institutional question. When CHM Warnick examines a hospitality proposal, does it evaluate only the proposed hotel's operating performance?

When BJH Advisors/Foresight Street examines a mixed-use project, does its review stop with construction costs, projected rents, debt and equity? When PFM examines municipal financing, what entities and risks fall within its review?

And when several developers, investors and special-purpose entities participate in the same transaction, which organizations undergo financial due diligence?

A building can be financially viable on paper while the government still needs to understand the entities responsible for financing, constructing and operating it. That's where project underwriting and sponsor due diligence intersect. The recent DLP SEC filing provides an interesting comparison precisely because the outside adviser describes looking beyond an individual property to management, financial information, leverage, liquidity, underwriting and valuation practices. Jacksonville need not duplicate an investment adviser's process. But taxpayers should be able to understand what Jacksonville's process is.

What Happens to Projects Already in Jacksonville's Incentive Pipeline?

There's another important complication.

Jacksonville didn't begin offering Downtown incentives when its outside-consultant system was established. Many current projects originated under earlier agreements or entered negotiations before DIA strengthened its underwriting structure.

Gateway's first Pearl Square phase, for example, already received substantial public commitments before the current consultant architecture existed. Now Gateway has returned with N7, Riverfront Plaza, Merrydelle and additional pieces of its larger Downtown development plan.

Corner Lot has completed projects, proposed projects and proposed modifications to existing incentive arrangements. Other Downtown developers occupy similar positions at different stages of negotiation, approval, construction and operation.

DIA's new outside-underwriting cost framework applies prospectively to qualifying new applications and agreements rather than simply reopening every existing agreement. That's understandable. But it creates another important governance question: When an existing developer returns seeking additional public assistance, does Jacksonville's newer independent underwriting process take a fresh look at the broader developer relationship and existing public commitments—or only at the newest project?

Due Diligence Shouldn't End When Jacksonville Approves the Incentive

There's another side of financial oversight that has received considerably less public attention.

Most due diligence happens at the front door.

What will the project cost? How much private capital will be invested? What financing gap exists?

How much public assistance is necessary? What taxes will the development generate? And what return does Jacksonville project?

DIA's methodology explicitly uses projected ROI to evaluate qualifying projects. Its high-rise methodology requires at least 1.1-times projected coverage under specified conditions.

Those projections help government decide whether an investment makes sense.

But eventually a projection becomes something else.

A result.

Jacksonville Has Approved Downtown Incentives for Years. Where Is the ROI Scorecard?

This is where the due-diligence discussion connects directly with a question The 101 Report has raised throughout our examination of Downtown incentives.

We have found extensive public documentation showing front-end financial analysis.

DIA calculates projected tax revenue. It establishes minimum private-investment requirements. Its REV programs contain provisions reducing or eliminating benefits when qualifying investment falls short.

That's meaningful accountability.

What we have not identified is an easily accessible, regularly published retrospective scorecard comparing the economic returns projected when major Downtown incentive packages were approved with the results those investments eventually produced. That doesn't establish that DIA performs no post-award monitoring.

It clearly maintains compliance requirements for its programs. But compliance and economic performance aren't necessarily the same measurement.

A developer can satisfy contractual requirements while a broader economic projection performs differently from what Jacksonville originally anticipated. After five or ten years, taxpayers should be able to ask:

What taxable value did the project actually produce? How much private investment actually occurred?

How much public assistance has actually been paid? How much incremental public revenue has actually been generated? And how does that compare with what Jacksonville projected when the incentive was approved?

Outside Consultants Strengthen the Front Door. What Measures the Results?

This may be the broader lesson from DIA's new consultant structure.

CHM Warnick can potentially strengthen hospitality analysis. BJH Advisors/Foresight Street can add specialized scrutiny to mixed-use development. PFM can strengthen municipal-finance analysis.

Those are potentially valuable protections at the front end.

But an institutional system protecting public money needs both prospective and retrospective controls.

Before public resources are committed, decision-makers need credible assumptions, independent analysis and an appropriate understanding of the parties responsible for delivering the project.

After the project is operating, taxpayers need to know whether those assumptions proved reasonably accurate. A projected return can justify an investment. Only an actual return can validate it.

This Investigation Is Bigger Than DLP Capital

The newest DLP information provided the reason to look more closely at Jacksonville's safeguards.

It shouldn't become the entire story.

The question isn't whether Jacksonville should subject DLP to a uniquely demanding standard because outside reporting has raised questions about some DLP-related property valuations.

The standard should be institutional.

Gateway Jax, DLP, JWB, Corner Lot, Aspect—and the next developer seeking substantial public assistance—should face a system capable of answering the same basic questions.

What financial due diligence does Jacksonville require, who performs it, how consistently is it applied and what does the public eventually learn about whether the investment worked?

Those are questions about governance, not guilt.

After Another Major Gateway Vote, How Much Did Jacksonville Know?

The recent DLP information doesn't establish that Gateway Jax is financially unsound.

It doesn't establish that DIA's September 16 recommendations were improper.

And it doesn't establish that DIA failed to perform adequate due diligence.

What it provides is a timely opportunity to test Jacksonville's system for protecting public resources.

Earlier this year, additional examination uncovered an error in a Gateway financial model. DIA corrected it.

Tarbert was already moving to augment the agency's internal underwriting with outside financial expertise. Jacksonville now has access to specialized outside consultants for hospitality, mixed-use development and municipal finance.

That's a meaningful safeguard. Now comes the accountability test. Which projects receive independent review? Which consultant performs it? How deeply are the companies and partnerships behind the project examined? What happens when an older project returns seeking new assistance? What information reaches the DIA board before it votes? And there's one more question that shouldn't disappear after the ribbon cutting: When Jacksonville projects a return on millions of dollars in public incentives, who eventually measures whether taxpayers actually received it?

The answers matter beyond Gateway Jax, DLP Capital or any individual developer.

Jacksonville's challenge isn't simply attracting private investment.

It is building a system in which public participation is carefully underwritten before the deal, consistently monitored during it and measurably evaluated afterward.