By Dylan Dissenso
Many artists and city officials in Austin know David Wallace as developer Presidium Group’s charismatic spokesperson for the Riverside Arts District, but people in the state of Missouri and in other cities in Texas know Wallace as a con artist and a fraud. The seemingly well-mannered Presidium executive has done his best to hide his checkered past from the Austin public, but it is not difficult to uncover damning evidence on a man who has exploited the working class with such reckless abandon.
Wallace’s shady dealings began when he fell from grace as a Republican mayor of Sugar Land, Texas after the Securities and Exchange Commission (SEC) discovered that he was using two real estate funds to fraudulently funnel money into the notorious Business Radio (BizRadio) Ponzi scheme. BizRadio was a small AM radio station with a large online presence that provided financial advice. Wallace’s real estate funds were promoted heavily through BizRadio, and in turn investments in Wallace’s real estate funds weren’t put toward investing in real estate, but back into BizRadio to keep it afloat.
In Amarillo, Wallace vanished in the middle of his $113 million downtown project to build a sports complex, convention center hotel and parking garage. Wallace was responsible for managing construction of the parking garage portion of the project and was coordinator for the other portions when he packed up his offices and left in January 2015 without warning.
As scummy as these two episodes were, they were only a prelude to Wallace’s biggest con to date in Joplin, Missouri in 2011. On May 22 of that year, a mile-wide EF5 tornado ripped through the southern half of Joplin Missouri with only a 20-minute warning, killing 161 people and injuring over 1000 others. In all, 25 percent of the city was destroyed, including nearly 7000 homes, a hospital, and hundreds of businesses, with damages totaling $2.8 billion.
When Wallace heard this news, he saw an opportunity to profit. Two days prior, he and his business partner Costa Bajjali had been sued by the SEC for misappropriation of investor money. Taking advantage of the despair left in the wake of the Joplin disaster presented the perfect way for Wallace to bounce back.
Over the next year, Wallace and Bajjali were able to make backroom deals with city of Joplin officials, Crossland Construction, and other construction firms to secure their appointment as Master Developers of the $800 million Joplin redevelopment plan. Wallace had met Crossland Construction owner Chris Crossland when Wallace gave a speech at a convention dinner where Crossland received a phone call informing him that his mother’s house in Joplin had been destroyed.
The redevelopment plan was supposed to bring a library and movie theater complex, a Senior Housing facility, a post office and government building, an educational facility – 17 projects in all, essentially replacing many of the public needs along the southern half of Joplin.
In January 2015, nearly four years after the deadly tornado and with none of the redevelopment projects realized, Wallace and Bajjali skipped town and the Wallace Bajjali Development Partners, L.P. (WBDP) offices in Joplin and Sugar Land were both closed. City officials tried in vain to get a hold of the developers and find out what had happened to the project and to potentially serve them lawsuits, but both men were unreachable.
In August of that year, the Missouri State Auditor concluded an audit of Joplin, giving the city the lowest possible rating, stating that they didn’t ensure the process in which they selected WBDP as Master Developer was free from bias. Several members of the team that developed the requirements for the Master Developer decision process had meetings with WBDP before Joplin ever solicited bids for a master development plan, and the auditor believed these requirements may have been favorably written for WBDP.
One reference check for WBDP during the selection process said “stay away as far as you can” and “big hats no cattle.” These warnings, nor Wallace’s involvement with the BizRadio Ponzi scheme, stopped the city of Joplin from choosing WBDP as their Master Developers.
In March 2015, Joplin filed a lawsuit against WBDP and both men as individuals for breach of contract and fraud. In May 2015, a judge had ruled in favor of Joplin, ordering the men to pay $1.48 million. However, a couple months before Wallace had filed for bankruptcy, listing his debts estimated at between $10 million and $50 million, with 200 to 999 creditors. In January 2017, a Houston judge granted discharge of his debts, including the debts he owed to Missouri-based creditors as well as debt he owed from being sued by the SEC and a class-action suit by investors in the BizRadio Ponzi scheme.
Most of the investors in the BizRadio Ponzi scheme were retired or nearing retirement and won’t ever make back the money that was taken from them. Had the money actually been used for real estate speculation as it claimed, the working-class still would have lost out through raised rents, taxes, and evictions.
By May 2015, four months after he disappeared, Wallace landed a job as a business mentor for International Accelerator, an Austin-based company started by Angeles Angelou. Angelou is known for his twelve years spent as Vice President of Economic Development and Chief Economist with the Austin Chamber of Commerce where he helped recruit companies such as IBM, Apple, Samsung, Motorola, and AMD to come to or expand their business in Austin.
By January 2017, Wallace had moved over to another of Angelou’s companies, AngelouEconomics as Chief Operating Officer. In August, Wallace pitched a plan to the Pflugerville city council to partner with AngelouEconomics and Presidium Group to build the “Pecan District.” The project was referred to as a “mini-Domain” referencing the Domain mixed-use project in north Austin. Pflugerville city council eventually voted in favor of the project. Developers broke ground on the Pecan District in October 2018 and is projected to be completed in 2028.
Wallace’s abilities to scam city officials were on full display in Pflugerville, and he was hired by Presidium Group soon after. Presidium’s plans to raze the homes of nearly 4,000 working-class and student tenants in Austin’s Riverside neighborhood has also been likened to the Domain, dubbed the “Domain on Riverside,” but this project has run into continual setbacks due to pushback from revolutionary organization Defend Our Hoodz.
The rezoning for the project was indefinitely postponed for a second time late last month at a planning commission meeting that DOH disrupted, forcing the commission to call a recess and use security guards to remove the protesters from the council chambers.
At the meeting, Presidium’s lawyer Michael Whellan was requesting the project be put on the agenda for April 23 rather than be indefinitely postponed again. When asked about the long timeline for the rezoning process by commission chair James Shieh, Whellan expressed “extraordinary frustration.”
“I just feel strongly now that we have everybody’s attention, having a hearing date on April 23rd…will focus everybody on the remaining items,” Whellan said.
Wallace is listed as Presidium’s point of contact in a pamphlet to recruit arts organizations for the Riverside Arts District. Wallace promoted Tapestry Dance Company by livestreaming backstage before one of their performances last year. He’s invited arts organizations to host meetings at Presidium’s offices, and he’s also pictured with Tapestry Dance Company while they signed their lease for the Riverside Arts District.
The arts district has faced pushback from DOH as well, and their lot currently sits empty, despite plans for a grand opening in January. Last November, the arts district had a soft opening for East Austin Studio Tours, hosted by Almost Real Things and Pump Project. DOH protested the event relentlessly, in one case leading to a fight between a gentrifier and the picketers.
Since the protests, Presidium removed the tents from the arts district lot, and future events by Almost Real Things have been forced to move out of the Riverside neighborhood completely.
David Wallace is a Billy McFarland-esque character. McFarland is infamous for founding the Fyre Festival where he promised a luxury festival experience, but in the end delivered a mass of rain-soaked tents and mattresses. He used the money he owed the workers on the island of Great Exuma to bankroll his own opulence.
Wallace’s tented art district has been forced to close for the time being, and for the people of Sugar Land, Amarillo, and Joplin, Wallace has been revealed as a charlatan. For the Dallas-based real estate developer Presidium Group, that’s exactly the type of man they want.
Residents of Riverside are all too familiar with the double-dealing of Wallace and his type. They’ve seen developers time and time again promise to bring “affordability” but who only end up displacing current residents and breaking up communities. Fortunately, DOH is committed to combating swindlers like Presidium Group and Wallace and exposing them as enemies of the people.
Wallace and Presidium Group’s ruthless attacks on the working class are particularly heinous, but they aren’t unique in capitalism. Wallace and his type thrive under the dictatorship of the bourgeoisie, where society is upheld by the oppression and exploitation of the proletariat.
Unfortunately for Wallace and the whole of the capitalist class, their relentless assault on the masses inevitably gives rise to their opposites, revolutionary organizations like DOH and eventually a reconstituted Communist Party. This advanced detachment of the working class will not be satisfied with persecuting individual crooks like Wallace for their crimes against the people. It will lead the masses in smashing the bourgeois state altogether and imposing the dictatorship of the proletariat, because socialism is the only way out of capitalism.