State cancels auction at Aspen restaurant | AspenTimes.com

State cancels auction at Aspen restaurant

Andre Salvail
The Aspen Times
Aspen, CO, Colorado

Janet Urquhart The Aspen Times

ASPEN – The future of the shuttered Junk Aspen restaurant space at the corner of South Mill Street and East Hyman Avenue appears to be in doubt following the Thanksgiving Day suicide of entrepreneur Scott DeGraff.

DeGraff founded the bar and eatery in the summer of 2010 before putting the business in his wife’s name following a dispute with the city of Aspen over his application for a liquor license. Before taking his life early in the morning of Nov. 24, he faced numerous legal problems and debts stemming from several failed business ventures and disputes with former partners, and he was undergoing a bankruptcy process.

Not long after his death, a notice was placed on the door of Junk Aspen that advertised an auction of seized assets due to delinquent and unpaid state sales taxes. On Thursday morning, a scheduled state Department of Revenue auction of kitchen equipment and other items failed to materialize. That’s because someone settled the back taxes applied to the business, which were previously listed at more than $37,000, according to department spokesman Mark Couch.

Couch would not say who paid the back taxes on the business. He said the payment could have been more or less than the $37,540 estimate that was listed on a notice at the business in late November. Local business sources, who asked not to be identified, said that typically when a business owner cannot pay back taxes on a business operation and a government entity plans to seize property or assets, the property owner will step in and settle the debt in order to cancel the existing lease and free the space up for a new tenant or a possible venture by the building owner.

“The tax liability was settled,” Couch said. “I’m not allowed to say how much was paid.”

DeGraff’s widow, Liza DeGraff, could not be reached for comment Thursday. Her phone number is unlisted, and a message sent to her email address was not returned. A phone recording at Junk Aspen stated, “This mailbox is full and cannot accept new messages.”

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Commercial real estate broker Karen Setterfield said the building that housed Junk Aspen, as well as the adjoining space currently occupied by Pacifica Seafood and Raw Bar, is owned by Chicago-based company 305-307 Mill Street LLC. She said she worked with another broker, Lorrie Winnerman, on the sale of that property in April 2010. The sale price was $5.1 million, and the property, previously owned by the Barnard Trust, representing Stanford University, was only on the market 12 days before it went under contract to the Chicago company.

Setterfield said she does not know anything about the Chicago company’s plans for the Junk Aspen space, which encompasses about 1,800 square feet. The space also includes the nearby Popcorn Wagon, a 60-square-foot fast-food operation that was serving late-night snacks as recently as last summer.

“Whatever happens with the Junk space, the Popcorn Wagon would likely be a part of that,” Setterfield said.

She said Junk Aspen had a long-term lease and that she wasn’t sure whether the owner plans to terminate the lease, an action that is usually allowed through a provision in rental agreements following a tax-related seizure.

“All of this came up rather suddenly,” Setterfield said. “Everyone needs to be respectful of the landlord and give them time to decide what they’re going to do.”

asalvail@aspentimes.com