Detroit Riverfront Conservancy's ex-CFO bought property for cigar bar

Eight years into his role as CFO of the Riverfront Conservancy, William Smith hatched a grand vision for a cigar bar at a vacant property near the east riverfront.

The big picture: Smith started a development firm in 2019 and bought the empty buildings last year, but the site remains undeveloped. The Conservancy and Smith's lender on the cigar bar project aren't answering questions about it.

Why it matters: Smith, who was charged today with federal bank and wire fraud, attempted to leverage his expertise as the conservancy's CFO to acquire property for the development, documents obtained by Axios Detroit show.

Zoom in: The federal complaint does not mention the cigar bar, but charging documents note that Smith "established many other business entities in the state," two of which were involved in his alleged embezzlement scheme.

Behind the scenes: Axios Detroit reviewed more than 100 pages of public records that detailed Smith's property bid, his vision for the cigar bar and $3 million in loans he obtained for the development.

Flashback: In 2019, Detroit's Economic Development Corporation (EDC) sought bids to redevelop vacant property near the Dequindre Cut at 1977 E. Woodbridge to complement the east riverfront's existing investments.

• Smith's development firm, Biltmore Development Group, offered $500,000 and was selected among five bidders for the property.
• Biltmore was awarded the project in 2019, but did not close on the property until April 2023 due to pandemic-related delays.
• The EDC is a public body that manages certain redevelopment sites in the city. The mayor appoints board members, who are subject to the City Council's approval.

State of play: Smith's cigar bar would be called Discretion, according to his written pitch to the EDC.

• The vision included a walk-in humidor, a bar, a board room reserved for business meetings, an outdoor patio and a barbershop.
• Smith touted his experience at the Conservancy leading its $100 million Riverwalk project in his proposal to the EDC.
• "Discretion will be placed in one of the most prominent and culturally rich spaces in the city," the proposal reads. "The east riverfront space has high structural value and a link to the history of the cigar industry."

The latest: An EDC spokesperson said yesterday that the agency was told in April that the city's building department was reviewing Biltmore's construction permits. City spokesperson John Roach did not respond to a message seeking confirmation.

The intrigue: Invest Detroit, a local lending institution with ties to the Riverfront Conservancy, approved $3 million in loans for Biltmore on April 27, 2024, the same day the firm acquired the property from the EDC.

• Invest Detroit and the conservancy are both chaired by local businessman Matt Cullen. Invest Detroit's president and CEO, Dave Blaszkiewicz, also serves on the conservancy's board.
• Smith also served on Invest Detroit's investment committee, according to its 2022 annual report .
• Invest Detroit declined to comment through spokesperson Craig Fahle.

The bottom line: Discretion's future at 1977 E. Woodbridge is unclear, to say the least.