Financial restructuring afoot for Aspen Club
December 6, 2017
The lender attempting to foreclose on the Aspen Club project conveyed the deed of trust on the property to another entity Tuesday, according to public records.
FirstBank assigned the deed of trust on the outstanding loan to GPIF Aspen Club, according to Pitkin County property records. GPIF Aspen Club, a limited liability corporation that was formed Tuesday, has its principal office in Fort Worth, Texas, based on a filing with the Colorado Secretary of State's website.
A deed of trust legally empowers the lender to foreclose on the property in the event that the borrower defaults on the loan. FirstBank, the primary lender on the Aspen Club's redevelopment project, started foreclosure proceedings in early November. At the time the bank said the Aspen Club owed it $30 million on a $45 million loan the club received in May 2016.
All the while, Aspen Club president Michael Fox has said the project will bounce back through a new financial approach — most of the construction work has been dormant since late August.
"This is part of our restructuring process," Fox said Wednesday in an email to The Aspen Times. "I cannot share any details at this point, but it is a good thing for the project."
Andy Hancock, the regional president of FirstBank, could not be immediately reached Wednesday. Syd Tofany, the chief deputy public trustee for the county who is overseeing the foreclosure proceedings, was out of the office Wednesday and also could not be reached.
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Terms of the loan to the Aspen Club won't change with the new holder of the deed of trust.
"A borrower has no legal right to block or negotiate the terms of an assignment of trust deed," according to legalzoom.com. "The assignment does not affect the terms of the loan. The monthly payments remain the same, although the borrower will have to send them to a new address. The new owner of the trust deed becomes the lender and collects all mortgage payments, sometimes on its own and sometimes through a servicing company. If a default occurs, the latest assignee has the right to foreclose and repossess the (property)."
When FirstBank took foreclosure action, it noted that Aspen Club violated contractual agreements of the loan because of more than $15 million in mechanics' liens on the property (more than $25 million in liens have been levied against the club), made at least 10 change-orders with the contractor for the first phase of the redevelopment without the lender's approval, and amended the construction contract with the contractor without notifying or receiving approval from FirstBank.
Aspen Club also "substantially changed" the scope of the project without FirstBank's approval and changed the budget of the first phase without notifying the lender, according to the notice of election and demand from FirstBank.
March 7 is the earliest a foreclosure auction would occur; Aspen Club has until Feb. 20 to file a notice of intent to cure the debt, though Tuesday's development could change that scenario.
The Aspen Club project, located at 1450 Ute Ave., includes plans to remodel the 40,000-square-foot Aspen Club & Spa building and the construction of a 54,000-square-foot lodge with 20 timeshares, while 13,600 square feet of development would account for 12 multi-family affordable-housing units.
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