Aspen historic TDR market still untested
The latest commodity in the Aspen real estate market has yet to change hands.
The city is watching patiently for signs of interest in its newly created historic TDRs, or transferable development rights. So far, a few real estate brokers and local architects have inquired about the program, but no one has yet tried to buy or sell a historic TDR.
“I don’t know if there’s a lot of awareness of it,” said Chris Bendon, the city’s long-range planner.
The TDR program allows the owner of a historic home to transfer development potential from his or her property for use by another homeowner. One TDR is worth 250 square feet – roughly the size of a single-car garage or a nice-sized bedroom.
The unanswered question is, how much is an extra 250 square feet worth to a homeowner whose house is already built out to its maximum under the city’s zoning code. A non-historic home that has no further ability to expand can get another 250 square feet through the purchase of a historic TDR. A duplex can “land” two TDRs – one for each unit.
The city established the program as an incentive for historic preservation. The owner of a historic home that has at least 250 square feet of unbuilt development potential can sell off that development right, presumably recouping the value of that floor area without tacking an addition onto the historic home and compromising the structure’s integrity.
“It’s kind of a nice partnership between the community’s interest in protecting historic properties and the development community’s interest in getting [floor area],” Bendon said.
“If you had a piece of property that only had a little bit of development potential left, you might want to cash in on this,” added Amy Guthrie, the city’s historic preservation officer.
The cash-strapped Aspen Historical Society, which could have several TDRs to sell from its expansive Wheeler-Stallard House property, has also inquired about the program, but no property owner has yet been issued actual TDR certificates by the city. For the historic-property owner, the process is as simple as having the city calculate the unbuilt floor area available on the property and issuing TDR certificates for each 250 square feet, according to Bendon.
No partial TDRs are permitted; a property owner with less than 250 square feet of unbuilt development potential can’t get one. And, a TDR can’t be used on another historic property.
Bendon estimates the city’s historic homes could produce about 100 historic TDRs altogether. He’s guessing they could sell for $75,000 to $150,000 apiece, but no one knows for sure.
“It’s really going to be supply and demand,” he said.
Pitkin County initiated a TDR program of its own in 1997, allowing owners of backcountry parcels to sell building rights from their properties for use in areas the county deemed more appropriate for development. One TDR in the county is worth an additional 2,500 square feet to a buyer, or it can be used to gain an exemption from the county’s growth-management process.
According to the county’s 2003 year-end report, 130 TDR certificates have been issued since the program began; 47 have “landed” and been extinguished. The county doesn’t track the price TDRs are fetching, but “word of mouth” has it that one sold recently for $180,000, according to the report.
The county assessor’s office estimates the current value of a county TDR at between $175,000 and $200,000.
The county decided from the outset that it wouldn’t concern itself with the price of TDRs and doesn’t track the transactions, according to Ellen Sassano, the county’s long-range planner.
“We really just saw them as a commodity – much like real estate – and that the free market would set the price and that the price would fluctuate,” she said.
Janet Urquhart’s e-mail address is firstname.lastname@example.org
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