Bankruptcy leaves Ironbridge housing winners in limbo
Glenwood Springs correspondent
Aspen, CO Colorado
GLENWOOD SPRINGS ” Fortunately for Kevin Warner, his landlord hadn’t rented out his family’s Marble house after they gave notice and were expecting to be into their new house at Ironbridge by late February.
“We called him up and were able to stay, so we were fairly lucky in that regard,” said Warner, a U.S. Forest Service employee in Carbondale and one of 10 Ironbridge affordable housing lottery winners who were hoping to finally be in their new homes after several months of delays.
That was until LB Rose Ranch LLC, a subsidiary of the bankrupt Lehman Brothers, filed for Chapter 11 bankruptcy protection in U.S. Bankruptcy Court in the Southern District of New York on Feb. 9.
LB Rose, the company that’s building the 20 affordable housing units and more than 100 free-market houses at the Ironbridge subdivision between Glenwood Springs and Carbondale, skirted the initial Lehman Brothers bankruptcy. Construction on the homes had resumed early in the year after initially being suspended last September.
However, the new bankruptcy filing asks to be consolidated with the larger Lehman Brothers case, which raises concerns that the deed restrictions on the 20 affordable housing units, which were required by Garfield County as part of the Ironbridge subdivision approval, could be in jeopardy.
Garfield County Housing Authority Executive Director Geneva Powell could not be reached for comment for this story. But Warner said he has been advised that it’s possible they may never be able to close on the houses.
“We have been told that the judge could trump the county’s deed restriction and put the homes on the open market,” said Warner, who was to close Feb. 20 on his new house. “I know they’ve (county housing officials) done all that they can to try to prevent that from happening, but we still don’t know.”
Another lottery winner, Tyler Nicholson of Carbondale, was set to close March 6. But the new bankruptcy filing halted his plans as well.
“I did the walk-through, and had a loan all ready to go,” said Nicholson, who is living in his parents’ basement until another housing option presents itself.
“I’m ready to move on and do what I need to do,” he said. “I don’t like it when I’m not in control of things, and this project has been very out of my control.”
Cindy Sadlowski of Smotherman and Associates Real Estate, who is representing the buyers, is equally frustrated.
“I’m just telling them that as soon as we know anything, I’ll call them,” she said. “It’s such uncharted territory, but I would think the court would see that we have an obligation to these buyers, and would allow them to close and move in.
“I’m just trying to remain optimistic,” she said.
Warner said the Ironbridge lottery afforded he and his wife, Stephanie, a Carbondale native, and their 1-1/2 year-old daughter an opportunity to establish themselves in the valley.
“We are looking at this as a long-term solution, so we can stay here and live close to her family,” Warner said.
Ten people were chosen in the first of two lotteries for the 20 affordable units at Ironbridge last Sept. 9. The lottery for the second 10 houses is now on indefinite hold.
County commissioners on Monday also granted an extension for the final Ironbridge development approvals.
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