Town pursues purchase of Snowmass Inn for workforce housing program
Snowmass Town Council unanimously approved an ordinance Monday that will allow staff to pursue purchasing the Snowmass Inn, a current workforce housing property that would be brought into the town’s affordable housing program.
The ordinance allows the town to enter into a purchase contract with the inn’s current owner, CA Loan I, LLC. Under the contract, the town will pay the limited liability company $200,000 in earnest for the Snowmass Inn, taking it off of the market and allowing town staff 120 days to investigate whether it wants to close on the full $6 million purchase of the property.
“I think it has a lot of interesting potential to bring into the (town housing) portfolio in many ways like we did with the Carriage Way property just about a year ago now,” said Betsy Crum, town housing director, at the Monday meeting. “The real value of it is preserving it as affordable housing for our local workforce and potential redevelopment at this location.”
According to Crum, the town began to seriously eye the 41-unit “inn,” which has provided free-market rental housing at an affordable rate for the village workforce for many years, about a month ago.
That’s when CA Loan I, a limited liability company, purchased both the Snowmass Inn and the Snowmass Chalet for $14 million, as recorded by the Pitkin County Clerk and Recorder’s office April 20.
After the purchase, the owner of CA Loan I, who is an advocate for and volunteer with Challenge Aspen, indicated to the village nonprofit that he hoped the Snowmass Chalet could become its new long-term home. Both CA Loan I and Challenge Aspen are working together to explore this potential purchase, as previously reported.
The split of these sister properties, both slopeside locations on Daly Lane adjacent to the Village Mall, opened up the opportunity for the town to look at acquiring the Snowmass Inn on its own, Crum said, preserving it as workforce housing.
The Snowmass Inn was first built in 1967 and received a full renovation in 1985, according to town documents. There are 39 studios with full bathrooms and kitchenettes, along with two full apartments. Right now, the inn is full and each room is rented out at $1,500 per month, including weekly housekeeping and utilities. Various businesses sublease the rooms to two tenants, who pay $750 each, town documents say.
If the town purchases the inn, Crum said town would want to do some renovations to the property, though specifics of the improvements will not be clear until after its investigation or due diligence period.
She believes about $1 million out of the housing department’s reserves will be needed to make these anticipated renovations, which will not impact the other planned housing improvements and projects the town has already budgeted for.
Crum also said the town would plan to keep rent rates the same for at least a year if it acquires the Snowmass Inn, and estimates the property would be able to support a 20-year mortgage of the $6 million at the current interest rates.
But although the town has an idea of what improvements may be needed to bring the inn up to town housing standards, staff needs to do an in-depth investigation on the property — which includes carrying out various inspections, accessing all financial and legal specifics and obtaining all other information the seller has on the inn — before making any final purchase decisions.
“We don’t know exactly what the renovation is, we don’t know the amount yet. We’ve got to get in there. We put that $1 million number in there as a placeholder number so there was no shocker,” said Town Manager Clint Kinney at the Monday council meeting. “That’s what this due diligence period is for.”
If the town does acquire the Snowmass Inn, it will be add to its master housing plan, a near-term strategy established through the 2018 comprehensive plan to “update housing regulations, actively identify opportunities and partners to address senior housing needs and incentivize the creation of an additional 200 units,” according to town documents.
Crum said the inn’s 41 units would be taken out of this 200-unit goal (soon to be 185 with the in-progress creation of the Coffey Place housing subdivision), and could potentially be redeveloped in the future to create even more affordable housing.
After little discussion, council passed the ordinance in a 5-0 vote, approving the purchase contract for the Snowmass Inn, which will be executed by Mayor Markey Butler.
Town staff will come back to council after the due diligence period with a recommendation on whether to purchase the Snowmass Inn. If the town does not go through with the purchase of the property, it will get its $200,000 back, staff said.
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