Carbondale issues notice of default on developer
CARBONDALE – Carbondale town officials will file a formal affidavit of default on the stalled Mountain Sage Townhomes project, in an attempt to secure at least part of the more than $383,000 in debt owed to the town for public improvements.The Carbondale Board of Trustees, at a special meeting Tuesday, voted unanimously to file the affidavit with the Garfield County Clerk and Recorder’s Office.The document serves as notice to the county and title companies that any future transactions involving units still held by the developer, Colorado Main Development LCC, are subject to town review.”It does provide a potential opportunity to ask for new security [on the debt] any time there’s a transaction,” town attorney Mark Hamilton advised the board.The town would also have the right to review financial matters associated with the project whenever a certificate of occupancy is requested for newly built units, he said.The move is similar to what the town did in 2009 with another residential development, the Cleveland Place subdivision, for failure to fulfill an obligation to build its required affordable housing units, acting town manager Nancy Barnett said.”This essentially confirms what has already transpired [with Mountain Sage],” she said.Late last month, the bank that was financing the Mountain Sage project, Denver-based United Western Bank, was shut down by federal regulators. Its assets were transferred to North Carolina-based First Citizens Bank & Trust.The bank failure put an even bigger question mark on the financially troubled project. It’s also uncertain if the remaining $383,700 letter of credit owed to the town would be secured if the project were to go into foreclosure.A more aggressive option to protect the town in the event of foreclosure would be to revoke the development approvals and downzone the undeveloped portion of the Mountain Sage property, Hamilton said. That would require a formal public notice and hearing process, he said.Enough trustees were willing to at least explore zoning remedies to ask staff to look into the details and report back at a future meeting.Only 14 of the 26 approved units were built before the housing market dropped off in late 2008. The developers have said they do not intend to break ground on the remaining units until the first phase is sold out. Eight units remain unsold, although six of the unsold units are being email@example.com
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