Atlanta investors close in on The Aspen Club
The financially strapped Aspen Club is close to inking a deal with a group of Atlanta investors to salvage its stalled redevelopment project.
Newly formed Aspen Club Partners LLC submitted a form with the Securities and Exchange Commission on Friday announcing equity financing of $40 million. The Form D does not disclose any specifics about the financing; however, Aspen Club President Michael Fox confirmed Wednesday that “we are literally wrapping up recapitalization for the Aspen Club.”
Calls to Aspen Club Partners were not returned. Fox said Aspen Club Partners has no previous connection to Aspen or the club. Fox’s job will remain the same once the financing is finalized, which he said is expected by the end of January.
“I am still leading the group,” he said.
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Through equity-financing — think “Shark Tank” — The Aspen Club won’t be obligated to pay back the $40 million because it will come from Aspen Club Partners’ investors.
With the investors in place, Fox said he expects construction on the delayed Aspen Club project to resume as soon as late March, with completion anticipated by the summer of 2020.
Early-spring construction would put an end to some 20 months of dormancy on the redevelopment of The Aspen Club, located at 1450 Ute Ave. The project ground to a near halt in late August 2017, when multiple contractors withdrew from the job because they had not been paid for their labor and materials.
The fallout spilled into the legal system with mechanics’ liens from subcontractors and a lawsuit by the general contractor, Denver-based PCL Construction Services Inc., which sued The Aspen Club for a $17.7 million lien it filed against The Aspen Club in September 2017. That lien also covers the amount the subcontractors claim they are owed. The suit is pending in Pitkin County District Court.
The Aspen Club also is delinquent to the tune of $30 million to GPIF Aspen Club LLC, which acquired the loan in December 2017 from FirstBank. GPIF Aspen Club LLC and FirstBank are not affiliated.
GPIF Aspen Club took foreclosure steps against The Aspen Club in November 2017, but the scheduled auctions have been postponed on a weekly basis as negotiations continue behind the scenes.
However, March 7 is the deadline for the foreclosure matter to be settled — with or without an auction — because the date represents one year from the original sale scheduled by the Pitkin County Treasurer’s Office.
“They will either have to go to a sale or withdraw,” said Chief Deputy Treasurer Syd Toffany.
Construction originally began in January 2016 and included remodeling work on a 40,000-square-foot Aspen Club & Spa building and a 54,000-square-foot lodge with 20 timeshares, which comprises 36,000 square feet of townhouse units and 18,000 square feet of club units. Another 13,600 square feet of development would account for 12 multi-family, affordable-housing units. The club has been closed since April 2016; club members have received reciprocal benefits at other Aspen fitness centers.
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