Hospital to buy Beaumont Inn
Aspen Valley Hospital is poised to purchase the Beaumont Inn to serve as housing for hospital employees.
The AVH board, which has not yet committed to the purchase, is expected to make a decision at its Oct. 16 meeting. The real estate deal is scheduled to be finalized that same evening, according to Bill Brunworth, AVH project manager.
The Beaumont, a 31-unit lodge on Aspen’s east side, has been listed for sale for $5.1 million for more than a year, according to co-owner Jeff Stafford.
Brunworth declined to reveal the amount AVH offered for the property, which it has placed under contract, but said it was less than the list price.
The conversion of the Beaumont to employee housing would make the lodge the latest in a long string of Aspen’s old ski lodges that are housing workers instead of tourists.
It’s a trend that has left some resort officials bemoaning the loss of Aspen’s bed base. The Aspen Skiing Co. has lamented the loss of lodging in town as a contributing factor in its 16-percent drop in customer visits the past two ski seasons.
The town’s competing needs for worker housing and lodging puts Aspen between the proverbial rock and a hard place, Stafford concedes.
“They want more lodging rooms, and they want more housing – it’s a difficult position for them to be in,” he said.
But the lodging business, added Stafford, is a tough place to be in, too.
Stafford and Bill Cockeham purchased the former Crestahaus Lodge Bed and Breakfast for $3.3 million in June 1996. They plugged money into upgrading the property and hoped to expand the lodge, but were never able to secure financing for additional units, Stafford said.
It has been “very discouraging,” he said. “We need more rooms to make it profitable.”
The hospital’s plans for the property are still up in the air, according to Brunworth, who’s just pushing to make the deal happen at this point.
For this winter, AVH may simply seek a conditional-use approval from the city Planning and Zoning Commission to rent out the lodge units to employees. Renovation of the lodge into apartments can come later, he said.
Eventually, the hospital may sell some of the units to employees and rent out others, Brunworth said. The lodge property, fronting State Highway 82 on the outskirts of town, also offers room for future expansion, he said.
The Beaumont is one of two housing projects currently on the hospital’s plate. It is also pursuing a project with the Music Associates of Aspen (MAA) at the Aspen Airport Business Center. An architect is currently studying how many units could be constructed there; a report is expected within 10 days, Brunworth said. No offer for that property has yet been made, he said.
If AVH needs financial help with the Beaumont, the MAA may be asked if it wants to be a partner in the lodge conversion as well, he said.
There have been some discussions about selling off some of the Beaumont as free-market housing as a way to finance the project, but that is not the hospital’s desire, according to Brunworth.
“We’d prefer to do 100 percent affordable housing, but certainly, economics will drive that,” he said.
The Beaumont consists of four two-story buildings and one single-story building. Some portions of the main building, which now contains a kitchen and a dining room that is open for breakfast, date back to 1886, according to documents filed with the city. The property also contains a swimming pool, hot tub and wet bar – amenities the hospital may or may not keep for residents. “We haven’t really figured out, if we get to closing, what we’re going to do with the pool and that stuff,” Brunworth said.
It appears the dining room/lobby area could be fairly easily divided into two townhomes with bedrooms upstairs, he added.
Hospital officials have discussed a bond issue to fund purchase of the Beaumont, though it would initially be purchased out of cash reserves, according to Verna Bartlett, AVH chief financial officer. Bonds could be used for both the Beaumont and the joint project with the MAA, though the costs of that project are not yet defined, she said.
A bond issue for housing would not jeopardize the hospital’s financial position, Bartlett added. “Our debt reserves are quite conservative,” she said. “This should not put us at any dangerous levels.”
Brunworth said AVH hopes housing can be provided at the Airport Business Center and at the Beaumont instead of on the hospital’s campus. Pitkin County’s 1997 approval for a medical office building at AVH required a significant amount of housing at the hospital. The office building has not been built; the hospital’s request to renew its approvals will go before county commissioners next week.
If the sale of the Beaumont goes through, it will be the second conversion of an Aspen lodge to employee housing this year. The Ullr Lodge was recently renovated as the Ullr Commons Condominiums. Ten local businesses purchased units at the 27-unit complex to rent to their employees.
AVH actually put in a couple of offers for the Ullr, Brunworth said.
When the Beaumont came to the hospital’s attention, staffers were immediately impressed, he said.
“Until I went up there and walked it, I didn’t know what a great property it was,” Brunworth said.
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