Lagoon Development Loses $22M Incentives, Faces $3M in Liens

Progress has stalled on a $1 billion lagoon-anchored development known as Leander Springs.

Austin-based iLand Development Group is facing $3 million in liens and has lost its $22 million incentives package. The ambitious project was poised to deliver 1,600 multifamily units, a hotel and 1 million square feet of commercial space centered around a 4-acre lagoon, the Austin Business Journal reported.

Announced with great fanfare in 2020, the project on a 78-acre site at the corner at Farm to Market Road 2243 and the 183A frontage, was intended to transform Leander into a Central Texas destination.

The developer secured local approval in 2021, but construction has hit a wall. The city’s patience wore thin earlier this year when iLand failed to meet deadlines for the project’s first phase. As a result, Leander terminated a $22 million incentive agreement designed to support the development.

More than a dozen liens, totaling roughly $3 million, have been filed against iLand for unpaid work, the outlet reported. Among the companies affected are Austin-based STG Design, Levy Architects, and Kimley-Horn and Associates.

While iLand managed to settle $800,000 of those outstanding debts, many contractors remain unpaid, straining small businesses involved in the project.

Andrey Derevianko, CEO of iLand Development Group, attributed the delays and financial difficulties to the complexity of the project and challenges in obtaining necessary permits.

“We’re doing our best to obtain the permits and pay all outstanding invoices,” Derevianko said.

Furthermore, the project has raised some concerns over the city’s water capacity and economic development. Leander Mayor Christine DeLisle has long been skeptical of the project due to concerns over water usage.

“If they can’t pull it off, there is a potential the city ends up with a giant hole,” she said.

— Andrew Terrell