County tinkers with timeshare policies
The Ritz-Carlton’s return to Aspen and its likely effect on the housing crisis has elicited great interest among planners, attorneys and elected officials in Pitkin County, but apparently no action.
The Board of County Commissioners voted unanimously Tuesday to adopt amendments to the county code that directly affect fractional-ownership projects, otherwise known as timeshares, like the one being built at Aspen Highlands by Hines Development for Ritz-Carlton. However, the board passed on the opportunity to tack on more stringent housing mitigation requirements.
County Planning Director Cindy Houben said her staff looked closely at the employee-generation projections published in a front page article in the September 20 edition of The Aspen Times. They even considered proposing code amendments to reflect the likelihood that a condominium owned by a dozen unrelated people will have greater impact on the community than a condominium owned by a single owner.
In the end, however, Houben said the planning staff decided it was better to calculate employee generation and housing mitigation for fractional ownership projects similarly to the way it’s done for lodges or condominium units rented out on a weekly basis.
The commissioners did agree that developers should be required to either sell all of the condominiums in a building as fractional-ownership units, or none. The restriction is meant to protect property values in traditional condominium projects where each unit is owned by one person or family.
Fractional ownership is, for all intents and purposes, a new name for timeshare – an ownership arrangement that allows numerous people, often without any connection to each other, to buy into a unit. In the case of the Ritz-Carlton’s project, each condominium will be sold to 12 separate parties, so each owner will have the right to use the unit and the club facilities that come with it for a month each year. Similar ownership schemes are being planned at the Snowmass Club and in effect at the Roaring Fork Club in Basalt.
The new name for an old concept may be a way for developers to avoid association with the timeshare schemes of the 1970s, which sold unwitting investors part interest in shoddily built condos and worthless plots in Florida’s swamps.
What was an investor’s nightmare two decades ago has become a developer’s dream today. If all goes as planned, the Ritz-Carlton will collect between $85,000 and $335,000 a dozen times on each of the 73 units in the project, according to figures provided by the Ritz-Carlton Development Corp. That means the cheapest unit will bring in $1,020,000; the highest-priced unit will net the company $4,020,000.
The code amendments adopted Tuesday were meant to bring county rules into compliance with state law. They were specifically written to deal with “common-interest communities,” such as condominiums, planned communities and timeshares, and to clarify the definition of a subdivision.
County attorney John Ely said the county land-use code had no specific rules for condominium development. The rules that were used for applications to build condominiums were set by a state law adopted several years ago.
By adopting the amendments, the county created an administrative process for condominium developers and county officials to follow, and formally recognized the rights and restrictions placed on condominium developers. “It should just make it easier to deal with applications,” said Ely.
The changes also clarify the meaning of “subdivision.” The new language makes it clear that separate ownership interests in a condominium complex do not give each individual unit owner claim to a lot.
If, for instance, a four-unit condominium building that sits on 10 acres burns down, the owners don’t have the right to divide the land into four separate 2.5-acre lots and build single-family homes. Although it was unlikely they could have under the old code, the amendments are meant clarify the county’s stance on the issue.
Ely said the code changes should have no visible effect on the likelihood of approval or denial on any given application to build a condominium complex.
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