New owners of Base Village issue first statement
December 2, 2011
SNOWMASS VILLAGE – The new owners of Base Village, a consortium of four European banks, issued their first statement Thursday about the future of the project.
“The international bank group which is now the owner of the property will work with the town of Snowmass Village and other parties to allow the completion of this project,” said Andreas Henry, the head of communications and a managing director at FMS Wertmanagement, which is based in Munich, Germany.
It wasn’t much, but it was more than the previous owners of the project, Base Village Owner LLC, a subsidiary of the Related Cos. of New York, have said about the project since early 2009, when they walked away from Base Village and defaulted on a $520 million loan from the four banks.
“It sounds like a general statement,” said Russ Forrest, the Snowmass Village town manager. “But I think it is a positive step forward in that we are now at least dealing with owners versus a receiver. We are still looking forward to working with a new developer. That’s where we expect to get into meaningful discussions.”
FMS Wertmanagement, an agency of the German government, is in a position to speak about the future of Base Village because it has been charged with liquidating the assets of the Hypo Real Estate Group, a bank unit that the German government nationalized in the wake of the 2008 financial crisis.
A unit of the Hypo group, Hypo Real Estate Capital Corp., was the lead lender on the Base Village loan. Other lenders include Dekabank Deutsche Girozentrale of Frankfurt, Germany; KBC Bank N.V., of Belgium; and Danske Bank AS, of Denmark.
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While the banks submitted the sole bid of $138 million for Base Village in a foreclosure sale on Nov. 16 on the steps of the Pitkin County Courthouse, they didn’t officially own the asset until Dec 1.
After a foreclosure sale, there is a redemption period of eight working days to allow the previous owners of a property, in this case Related Cos., to redeem the debt by paying it off. That did not occur.
So now it is official – Related Cos. and California developer Pat Smith, who paid $169 million for Base Village in 2007, no longer have any ownership of Base Village.
The property deed for Base Village soon will be transferred to a new corporate entity the banks created, Snowmass BV Holdco LLC, which was registered with the Colorado Secretary of State’s Office on Nov. 9 as a foreign limited liability company.
Together, the four European banks say they are into Base Village for $505 million. Their $138 million bid on Nov. 16 was essentially an accounting exercise, as they bought their own debt.
The Base Village project is still being managed by a court-appointed receiver, Destination Snowmass Services, which is a subsidiary of Lowe Enterprises.
Jim DeFrancia, of Lowe Enterprises, says he now will prepare a final status report on the project for the District Court judge overseeing the foreclosure. Then he expects the court to turn management of Base Village over to the banks.
DeFrancia said that process is likely to take 45 days, or until mid-January. He is hopeful that the banks then will hire Lowe Enterprises to keep managing Base Village.
Meanwhile, the banks are still soliciting bids for Base Village through Eastdil Secured, a subsidiary of Wells Fargo that specializes in managing the sale of large real estate projects.
The Aspen Skiing Co. had earlier submitted a bid of an undisclosed amount for the project.
Another firm, Centurion Partners, of Newport Beach and Aspen, confirmed that it also had submitted a bid for Base Village.
East West Partners, of Vail; Real Capital Solutions, of Louisville, Colo.; and Related Cos., of New York, are also thought to have submitted bids on the project prior to the foreclosure sale but would not confirm that.
Forrest Village said he’s heard that there are now as many as seven entities analyzing the project with the banks.
“They are going through some sort of process with the banks, perhaps to refine their proposals,” Forrest said.