How a 1994 settlement determines what landlords charge Centennial tenants today
(Kelsey Brunner/The Aspen Times)
Tenants at the city’s oldest deed-restricted housing complex, Centennial Apartments, faced rent hikes as high as 30% in January that sent city, county, and APCHA officials into closed-door meetings with the relatively new landlord, Birge & Held.
At the center of the dispute is the interpretation of a 1994 settlement between Centennial ownership and local-government bodies that spells out how Centennial is permitted to raise rents.
Back then, Centennial-Aspen II Limited Partnership — the original owner of the complex — sued Pitkin County, the Pitkin County commissioners, the city of Aspen, the Aspen City Council, the Aspen/Pitkin County Housing Authority, and APCHA Board of Directors to increase the rent limititations.
In June 1994, the parties signed a settlement that enumerated how Centennial can determine raises to the rent, tying it to the Consumer Price Index determined by the Department of Labor.
The CPI is a measure of the average change over time in the prices paid by urban consumers for a market basket of consumer goods and services.
The settlement states that, from 2008 on, Centennial can raise the rent in the 148 rental units “by a percentage amount equal to the percentage change in the Urban Index during the twelve months ending on July 31 of the prior calendar year” — or based on the CPI for the preceding year.
And the settlement states Centennial Apartments only needs to comply with the CPI threshold as a complex, not by individual units.
This gives the owners Centennial the authority to raise some rents very high, like 17% and 30% in January, while other units face a lower rent raise.
A city official confirmed that some of the Centennial tenants received a rent raise less than the 2022 Denver CPI of 8.5%, but it is not clear exactly how many tenants face the smaller rent raise or how little the raise amounted to.
The Aspen Times is withholding the official’s name because they are not yet allowed to discuss specifics related to Centennial on the record.
Diane Foster, the assistant city manager, said in a statement to the Times: “Staff who are working on this topic have met with the Aspen City Council, the Pitkin County Board of County Commissioners, and the APCHA Board. Colorado state law precludes anyone from disclosure of the contents of an Executive Session. Our elected officials have made this a high priority for staff. We continue to work directly with the owners.”
Birge & Held declined an interview or to answer questions via email but sent this response: “Birge & Held is currently in discussions with the City on these matters. It’s premature at this time to provide detailed responses to these questions until things progress further with the City, but we remain confident we are following the Centennial lease provisions and ’94 Decree. Once we are further along, we would be happy to discuss and provide answers to your questions specific to our rent increases and timeline for potential redevelopment of Centennial.”
The settlement reads, “a compromise and settlement of this litigation is the best means for preservation of low rents at Centennial Apartments and minimization of Pitkin Count’s financial exposure.”
Still, tenants of Centennial Apartments will not always have the deed-restricted units.
The deed restrictions are set to expire at the end of the 21st year following the death of the last member of the Pitkin Board of County Commissioners who approved the development. Michael Kinsley is in his 70s and lives in Old Snowmass.
The city of Aspen was set to buy the deed restrictions for $10 million, but the deal fell through in January 2020 because Birge & Held and the city couldn’t agree to terms.
If the city had bought the deed restrictions, rent prices would have been capped in perpetuity.
Several years ago, original Centennial owner Sam Brown offered the city the chance to buy the property for $60 million and had recently reduced that to $50 million, but the municipal government declined.
Brown sold the complex to national private equity, real-estate investment, construction, and management firm Birge & Held for nearly $51 million in 2020.
For more information, read our previous coverage:
Aspen advances $10M purchase of Centennial deed restrictions
$10M rent control deal falls through for city of Aspen
