Related WestPac may swap out Snowmass land involved in lawsuit
The Aspen Times
Aspen, CO Colorado
SNOWMASS VILLAGE ” The town of Snowmass Village is not actively looking into allegations that property Related WestPac offered the town as collateral in a 2007 deal actually belonged to a different company with different investors.
“We haven’t really spent a lot of time on this one,” Town Manager Russ Forrest said of the claims. Bell Colorado, a British corporation, made the accusations in a lawsuit filed Feb. 12 in U.S. District Court in Denver.
However, Forrest said Related WestPac independently approached the town a few weeks ago about swapping the property in question for another piece of land the company owns.
Forrest said the discussion happened around the same time that Bell Colorado, an investor in the Brush Creek Estates luxury home project slated to be built on the parcel, filed a lawsuit concerning the parcel.
The lawsuit, filed against Related WestPac, executive Pat Smith and five other companies he manages or controls, raised questions about whether the land was solid collateral in the deal between the town and developer.
Less clear is whether there is any connection between the lawsuit and preliminary discussions about the land swap.
The Brush Creek Estates land currently provides the agreed-upon $8 million collateral for Related WestPac’s promise to build a hotel in West Village ” site of the Snowmass Mall ” by 2017. The hotel was promised in return for the town’s approval of the Viceroy Resort and Residences.
The lawsuit alleges that the land should not have been used in the deal between Related WestPac and Snowmass Village, because it was purchased with money from investors in Brush Creek Estates.
It also alleged the land was only worth about $3.4 million, despite the fact that Brush Creek Estates purchased it from another Smith-managed company, Brush Creek Capital Holdings, for $11 million in 2006.
The lawsuit argues that Smith wanted to use the money from the Brush Creek Estates investors to subsidize a $17 million purchase of the Snowmass Center without officially bringing additional investors into the project.
If that allegation is true, it would mean the parcel is not worth enough to secure the $8 million promise.
Snowmass Village did not have the land appraised before agreeing to accept it as collateral, said Forrest. He could not remember whether the town looked at an appraisal commissioned by Related WestPac, but said officials certainly would have looked at the purchase price to determine value.
Forrest said Related WestPac had approached the town on its own volition. According to the terms of Related WestPac’s agreement with the town of Snowmass Village, the company has the ability to replace the Brush Creek Estates parcel with another parcel, he said.
“They have indicated to us that they may want to propose that,” he said.
Related WestPac has not made a specific offer, he said, or indicated what piece of land it might choose to trade. But Forrest expected the town would certainly be willing to discuss the matter.
Related WestPac officials declined comment on the possible land swap.
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