Weed and wine tenants costing Aspen landlord $500 a day
Condo association fines mount as lawsuit continues concerning downtown building on Cooper Avenue
Condo association fines of $500 a day are racking up at a pace that could put a landlord into more than $500,000 in debt and also into foreclosure by the time a court fight over an Aspen pot shop and wine cellar ends.
So argued a motion for preliminary injunction filed March 3 by an attorney representing Douglas Tomkins in his legal dispute with Aspenhof Condominium Association over banned commercial uses at the 520. E Cooper Ave. building. The condo association “continues to move aggressively against Tomkins” as evidenced by two liens it filed Feb. 10 and its notice to Tomkins on Feb. 19 saying he owed $24,105 in fine assessments, the motion argued.
The fines keep mounting because Tompkins won’t satisfy the condo association’s demands to terminate the leases for two of his tenants, the Best Day Ever marijuana shop and Betula restaurant, which uses the space to store wine.
“(The condo association) has imposed fines and liens against the two units which during the pendency of this will total nearly a half million dollars,” said the motion, which was filed by Denver-area attorney Peter Bornstein. “The danger of foreclosure and the loss of the two properties is immediate. Tomkins seeks the aid of the court to stop the illegal actions of Aspenhof.”
Aspenhof had yet to respond to the motion as of Wednesday. Until then, the matter is pending before Judge Chris Seldin of Pitkin County District Court, which is where Tomkins originally sued Aspenhof in December, accusing the condo association of trying to retroactively enforce a ban that its members approved in 2020. That prohibition — placed on pot shops and inventory storage, along with other uses on the building’s upper floors — was added to the condo’s bylaws Aug. 31.
Aspenhof’s board declined comment Wednesday, but in a Feb. 1 counterclaim to Tomkins’ suit, association attorneys asked for the court’s confirmation that it can adopt and enforce the ban.
The pot shop and wine cellar “have created conflicts with other units in the building, overburdened its facilities and threatened property values,” the filing said, noting that Tomkins “has refused to comply” with the association’s recent provisions.
Best Day Ever’s three-year lease goes back to April 2017; last year it extended the lease through April 2023. The association said Tomkins and Best Day Ever were aware that a potential ban on upstairs pot shops was looming when they renewed the lease.
Likewise, Betula knew about the possibility of a ban on storage units at the building when it extended its lease through June 2023, Aspenhof’s counterclaim said.
Tomkins’ motion for an injunction, like the lawsuit, accused the condo association of singling out Best Day Ever and the Betula space.
“The Amendment expressly prohibits uses for marijuana dispensaries and storage on the second floor of the Building,” the motion said. “No other businesses were affected by the amendment, as it was drafted for the specific purpose of targeting Tomkins.”
The building’s basement level includes the Silverpeak Apothecary marijuana dispensary, but the pot-shop ban applies to upper level space of the building comprised of nine residential and 10 commercial units. As far as the association is concerned, Silverpeak is not a problem tenant.
“The Association affirmatively states that the other dispensary occupies a basement unit physically separated from the upper portions of the Building, does not present the concerns the Association aimed to regulate, and is not prohibited by the 2020 Amendment,” the association said in court filings.
The dispute between Tomkins and the association sunk at least one deal.
“On September 29, 2020, Tomkins received an offer of to purchase the unit in which the marijuana dispensary is located for $900,000,” Tomkins’ motion for injunction said. “When the potential buyer was informed about the dispute, the offer was withdrawn.”
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Aspen City Council will continue discussions Tuesday about clamping down on the business of short-term rentals by entertaining an ordinance would effectively ban applications for new licenses in 2022.