ABOR Exclusive --
Related WestPac President offers perspectives on challenges
In an exclusive interview, Related WestPac President Dwayne Romero told ABOR that he hopes the company and the community can work together toward a commercial development plan that is in line with its long-term vision.
"There always was a vision," Romero said. "That included a completed Base Village, eventual redevelopment of the Mall and the Snowmass Center."
"Now, in hindsight, the over-aggressive attempt to get all that done in short order was too much," Romero continued. "It needs to be a 25-year plan instead of a 5-year plan."
April has proven to be a challenging month for Related WestPac, with work stoppages, lien filings and foreclosure proceedings all compounding the difficult task of finding the financing necessary to proceed in Base Village.
Below, Romero comments on some of the big stories that have made headlines this month.
Foreclosure begin against $110 million loan
Bank of America initiated foreclosure proceedings against several Snowmass Village properties owned wholly or in part by Related WestPac after a $110 million loan came due at the end of February.
The properties include the Snowmass Center, the Sonnenblick Townhomes, the Snowmass Mountain Chalet, the Snowmass Inn and several lots combined under the name of Brush Creek Capital Holdings LLC.
Related WestPac is one of a number of parties involved with the loan, Romero said. "Related will honor its obligations in the loan package," he told ABOR.
"We're an active landlord at Snowmass Center, most of the mall, Base Village and Woodbridge," Romero emphasized. "Those are long-term investments."
If there is a change in ownership however, Romero doesn't expect the short-term reality on the ground to change for the local-serving businesses in the Snowmass Center.
Viceroy completion in question
Romero acknowledged that his firm has yet to receive direct payment from lenders who have promised to cover construction costs of the second Viceroy Resorts and Residences building.
Romero told ABOR that the loan for the first of the two buildings, from the German bank Hypo, is stable and completion is expected for the coming winter. The Viceroy is still scheduled to begin hotel operations in the completed first building by Christmas.
Financing for the second building, partially built and under a work stoppage, remains uncertain. Hypo, which had committed to make the loan, is being nationalized by the German government and is thus proceeding with extreme caution.
"They're worried about what we're worried about," Romero said. "And we're having very deep conversations about that."
Cattle Creek Colorado being reassessed
Romero told ABOR that plans to build over 1,000 homes in the Cattle Creek area between Glenwood Springs and Carbondale have been purposefully delayed. A hearing before the Garfield County Planning Commission originally scheduled for late winter is now set for July 22.
"We have delayed our application and are assessing our business plans," Romero said.
Changes and adjustments continue
Romero said developer Pat Smith now holds only a limited interest in the extensive collection of commercial properties he spent three years acquiring in Snowmass Village, Aspen and downvalley. Smith's buying spree began in 2005 through his development firm WestPac, and continued into 2008 with the Related WestPac partnership.
"In 2006, they were overpaying -- even in that go-go market," Romero told ABOR.
Romero said the partnership between California-based WestPac and The Related Group, a 40-year-old New York-based real estate development company, has been renegotiated. Related is now the lead partner instead of WestPac. "The switch was amicable," Romero told ABOR.
Over the next three months, Romero expects Related WestPac to continue working to stabilize its holdings through continued discussions with partners and lenders.
Hospital expansion would more than double traffic impact
The proposed expansion of Aspen Valley Hospital would add an estimated 866 vehicle trips per day, according a traffic impact study by the hospital. Currently, the hospital, on Castle Creek Road, generates 752 trips each direction.
AVH officials are proposing a two-story, 214,395 square-foot addition at the Castle Creek site. The hospital is currently 75,700 square feet.
The development plans include expansion of the emergency and imaging departments, a surgical suite, central plant upgrades, as well as medical office space, patient and family services, and a rooftop heli-pad. A new underground parking garage and surface lot that would accommodate 338 cars.
The expansion would occur in four phases with a complete build-out expected in 2016.
Aspen School District shopping for housing
The Aspen School District Board of Education has contracts on five free-market housing units, including one in Aspen, two at the Airport Business Center and two in Basalt. It is also considering the purchase of an unidentified parcel of land in Snowmass Village.
The district plans to build four new duplexes at the West Ranch project in lower Woody Creek as well.
The district has been working to mitigate its teacher housing crisis with $12 million approved last November by voters toward that end.
Superintendent Diana Sirko said the board could vote in May to close on some of the units now under consideration.
Basalt cuts residential development sharply
The Basalt Town Council hit the brakes on development by limiting free-market residential development in its new growth management plan to 32 units per year.
Council members justified their decision by noting that 300 units within town limits have received approvals but remain unbuilt. Another 300 units are under review. Units that have been approved or are in the system are exempt from the new rules.
Town Manager Bill Kane urged council to allow approval of 55 residences each year, the number recommended by a consultant. That way, he said, larger projects that can afford to offer significant public amenities might get proposed.
Some important features of the new rules include:
- Residential land use applications will need to secure a growth allotment before it can start through the review process.
- Allotments will be awarded twice a year to applications that best comply with a list of 11 community priorities.
- The priorities list is like a menu from which an applicant can choose which commitments to make for compliance in areas like community housing (for example, exceed housing requirements or build smaller homes), community facilities and environmental quality.
-Allotments will be awarded twice a year through a review process that goes before P&Z and the Council.
- Once the 32-unit annual limit is met, no more development applications will be considered until the next year.
- Small additions to homes, commercial development and residential redevelopment that adds no new floor area are exempt
New affordable housing rules going into effect
Between 30 and 35 percent of most new residential development in the Town of Basalt will need to be committed as "community" housing (i.e. affordable). The new rules apply to all housing developments of two or more units.
Commercial development will be required to provide housing for 25 percent of employees generated, up from 20 percent.
The new rules contain strong incentives for developers to create relatively small, for-sale commercial properties that are devoted to retail uses, by exempting such developments from the housing requirements.
Basalt sales tax collections down modestly
Basalt’s sales tax revenues were down 8 percent – to $242,265 – in February compared to the same month in 2008, considerably better than neighboring jurisdictions.
Revenues in Aspen, by comparison, plummeted 19 percent in February, and Pitkin County’s were down 21 percent.
Most categories in Basalt were down similar levels as neighboring communities. Restaurants dropped 8 percent, retail sales 39 percent, sporting goods 17 percent. Purchases of building materials fell 4 percent.
But liquor sales in Basalt were up 19 percent. And the retail food category, which accounts for just over one-third of the town's sales tax collections, posted a 1.25 percent gain.
Snowmass Village --
Affordable housing goal raised
Snowmass Village Town Council agreed to raise its employee housing goal to house more employees.
The town aims to begin requiring housing mitigation from developers that would provide for 70 percent of employees.
A change in the land-use code to reflect the new goal will have to be made separately. The housing mitigation rate required by the code is currently 45 percent. It was dropped from 60 percent during the Base Village land-use approval process several years ago.