Aspen Club going to foreclosure auction in January
Major redevelopment project east of Aspen has sat in limbo for more than three years
The Aspen Club & Spa is going to foreclosure sale Jan. 6, and the new owner will be responsible for paying approximately $80 million in debt attached to the property.
Ninth Judicial District Judge Denise Lynch signed an order Monday approving the sale after there were no legal challenges to foreclosing party GPIF Aspen’s proposal to put the property on the auction block.
As normally scheduled, the sale would be held publicly on the front steps of the Pitkin County Courthouse. Based on where public health orders stand the first week of January, it is unclear whether the auction would be held virtually or in-person. The Pitkin County Treasurer’s Office will conduct the auction, with the highest bidder taking ownership of a property where a major redevelopment project has sat in limbo since the fall of 2017 because of the previous ownership’s financial struggles and inability to pay contractors.
“The court has cleared it to go to foreclosure,” said Sydney Tofany, county deputy treasurer and public trustee. “It’s an official document that allows the public sale.”
The judge’s ruling was delivered as a default judgment because The Aspen Club did not meet filing deadlines.
Lynch’s order relates to two cases against the club. One was the foreclosure action GPIF Aspen launched in September. The other case was a lawsuit filed in November 2017 and led by Denver-based PCL Construction — the general contractor for the project — and dozens of subcontractors for unpaid bills.The construction firms are owed more than $25 million combined, a debt the new owner will absorb. Of that amount, PCL originally filed a claim for $17.7 million, which is now more than $19 million because of interest.
Those contractors are part of a larger pool of creditors who include note-holder GPIF Aspen, which is owed $30 million in principal alone, according to foreclosure records. Documents from Aspen Club’s Chapter bankruptcy case, which was closed earlier this year, indicated the sum was $42 million because of interest.
Another lender, Revere High Yield Fund, say it is owed $15 million for a bridge loan it gave the club.
Revere’s Clark Briner has had control of the club, which previously was run by Michael Fox, since Sept. 1, according to court records.
GPIF Aspen appears to be the front-runner to claim ownership of the property, according to people close to the matter. It has the most money tied up in the project, and there is incentive to restart the redevelopment, which includes a residential component, given the strength of what has been a strong seller’s market in Aspen since early summer.
“GPIF will be buying the property,” said a person familiar with the sale and speaking on the condition of anonymity.
The construction project site for the Aspen Club & Spa remains preserved at its 1450 Ute Ave. address on the east side of town. Fifteen of the site’s townhomes are between 60% and 80% complete, six condominiums are 30% complete, and the commercial component is 30% complete, according to filings in the bankruptcy case. The club has been closed for nearly five years.
Michael Williams of the firm Denver firm Senn Visciano Canges PC, which has represented GPIF Aspen during the foreclosure proceedings, could not be reached for comment Wednesday.
The path became clearer for GPIF Aspen after Florida-based creditor EFO Financial withdrew its foreclosure action earlier this month; EFO claimed it was owed $7.5 million.
GPIF Aspen Club is affiliated with Dallas investor Jeff Goff’s GP Invitation Funds, which is managed by Crescent Real Estate Holdings and Goff Capital Partners. The groups own the Canyon Ranch luxury resorts in Tucson, Arizona, and Lenox, Massachusetts, and the Brown Palace Hotel in Denver.
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