Business Monday: Aspen Club creditors to meet June 25
One of the first proceedings in the Chapter 11 bankruptcy proceedings of The Aspen Club & Spa is set for June 25 when those owed money will meet in Denver with the case’s trustee.
On Friday, U.S. Bankruptcy Judge Joseph G. Rosania Jr., who is presiding over the case, set that date for the creditors meeting. The judge scheduled the matter one day after The Aspen Club & Spa filed a bankruptcy petition in Denver that lists 20 creditors, which combined are owed more than $80 million.
The bankruptcy has placed what is called a “stay” on creditors from pursuing their debts which, according to court documents in the case, “means that creditors generally may not take action to collect debts from the debtor or the debtor’s property. For example, while the stay is in effect, creditors cannot sue, assert a deficiency, repossess property, or otherwise try to collect from the debtor.”
In a related development Friday, Aspen Club Redevelopment Property LLC, a wholly owned subsidiary of The Aspen Club & Spa, declared Chapter 11 as well, but it did not list any of the subcontractors that performed work on the fitness center’s redevelopment project as creditors. Listing more than $66 million in debt, Aspen Club Redevelopment’s petition identifies lenders and individuals as its 20 creditors owed the most money.
Aspen Club Redevelopment Property also listed the value of its assets between $50 million and $100 million.
Some subcontractors are listed as debtors on Aspen Club & Spa’s petition; the Aspen Club & Spa petition listed its assets to be worth between zero dollars and $50,000.
The Denver law firm representing The Aspen Club in the bankruptcy proceedings is Markus Williams Young & Hunsicker LLC, which on Friday filed a motion seeking to have the court jointly administer the two Chapter 11 cases.
Work on the project — including a remodel of the 40,000-square-foot Aspen Club & Spa building, the construction of a 54,000-square-foot lodge with 20 timeshares, and 12 multi-family affordable-housing units — came to a near halt in August 2017 when subcontractors abandoned the site because they were owed money for labor and materials.
Since then, The Aspen Club’s debts have been contested in litigation in Pitkin County District Court and other venues, while lenders have pursued two foreclosure actions that did not materialize.
The creditor owed the most money, $33.9 million, is GPIF Aspen Club LLC, which acquired a $45 million loan note from the original lender, FirstBank, in December 2017.
Aspen Club president Michael Fox said last week that the bankruptcy will provide a “clear path” for the club to reorganize its debts to the satisfaction of a group he says he has lined up to refinance the project. That same group is providing interim funding for the club during the bankruptcy proceedings, he said.
Fox said he expects construction to resume “once the new plan for reorganization is approved” by the bankruptcy court.
With more than 1,500 members at one time, The Aspen Club launched in the mid-1970s as a tennis and racquet club before expanding into the town hub for fitness and wellness.
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The Steadman Clinic isn’t publicly discussing its undeveloped site in Basalt but has submitted plans for a 50,000-square-foot clinic with a 44,000-square-foot underground parking structure.