Neighbors’ lawsuit stalling Grand Aspen development
May 29, 2002
Construction of a new time-share hotel near the base of Aspen Mountain, initially slated to begin this spring, has been stalled indefinitely as the result of a lawsuit filed by the project’s neighbors.Developers of the planned Hyatt Grand Aspen have had difficulty securing financing for the project in light of the pending litigation, according to Scott Writer, a partner in the project and spokesman for Four Peaks Developments.”Basically, it’s far more difficult to get construction financing in today’s market when there’s a lawsuit of this nature,” he said. “Things have pretty much ground to a halt. The lawsuit has hurt our ability to move forward.”On a related front, the redevelopment of the former Bavarian Inn as affordable housing has also been put on hold while Four Peaks pursues a new plan to tear the decrepit building down and start from scratch.Development of both the new hotel and luxury housing that Four Peaks intends to build at the base of the mountain are tied to the Bavarian housing project.Between the change of plans for the Bavarian and the delays caused by the lawsuit, Four Peaks has been forced to seek amendments of its approvals from the city for all three projects. The altered development schedule for the Bavarian, Grand Aspen and Top of Mill homes still requires final approval from the Aspen City Council.Four Peaks had hoped to commence work on both the new hotel and the Bavarian this spring. The 51-suite hotel, to be operated by Hyatt Vacation Club, was to open in the spring of 2004 – a schedule that may still be feasible, according to Writer.”I think it’s still possible to come close to that if things clean up on the lawsuit and financing side,” he said.The suit was filed in February by the Galena Place Townhome Condominium Association, representing a small group of homeowners who reside to the southeast of the Grand Aspen site. The neighbors are objecting to the height of the proposed hotel and challenging the height variance granted by the City Council for the project.The proposed new hotel will be 45 feet high, as measured from the sidewalk on the southwest corner of Galena and Dean streets to the top of the parapet at the center of the building, according to Sunny Vann, the planning consultant hired by Four Peaks.The front of the hotel will face Dean Street, to the south of the Silver Circle Ice Rink.The city zoning code sets a 28-foot height limit on the parcel, but the City Council granted a variance for the new hotel. The former Grand Aspen topped out at 32 feet.The suit asks a district court judge to halt construction of the hotel until their concerns are addressed. The necessary motion to trigger a court hearing on the complaint, however, has not yet been filed.Attorney Peter Thomas Jr., representing the neighbors, said he intends to file that motion after he has reviewed city records related to the case. Those documents include the minutes from various public hearings on the Grand Aspen project.Defendants in the suit include the City Council, the Planning and Zoning Commission and the city planning department, as well as Four Peaks.Both Writer and Thomas declined to comment Tuesday on whether attempts have been made to settle the suit out of court.Redevelopment of the Bavarian, meanwhile, will apparently be split into two phases. Four Peaks expects to submit building-permit applications for the approved new townhomes on the property in the next week or two, according to Writer.But Four Peaks has abandoned its plan to redevelop the vacant lodge at the corner of Main and Seventh streets as housing and is now seeking city approval to raze the structure and construct a new building.”The contractor went in there, did an evaluation and said, `you know, you could probably build a new building for a little bit more, or maybe the same cost,'” Writer said.Or, as Writer noted in a letter to the city, the change in plans was prompted by: “Our discovery that the existing Bavarian Inn is a worthless pile of junk and that all concerned benefit by us building a new one in its place.”The proposed new building would be placed in the footprint of the existing Bavarian. It would contain four studio units, one one-bedroom unit, two two-bedroom units and one three-bedroom residence – the same mix that was slated for the redeveloped Bavarian.In all, Four Peaks plans to spend $3 million to $4 million constructing 19 units of deed-restricted housing on the Bavarian parcel.The amended plan to replace the lodge with a new building is scheduled to go before the city P&Z in July. With the commission’s approval, the demolition could occur this year, Writer said.Demolition of the old Grand Aspen Hotel took place a year ago. Since then, the big hole in the ground where the hotel stood has been shored up, but no other work has occurred at the site, according to Writer.Sale of the time shares in the new hotel is slated to begin when construction commences, he said. Grand Aspen Lodging LLC, which owns the hotel property, has a three-year lease for the Mill Street space recently vacated by Eddie Bauer. It’s a stone’s throw from a real estate sales office operated by Four Peaks, which is selling townhome sites at Aspen Highlands Village.