Aspen moves forward with $11M contract for property to help with future affordable housing | VailDaily.com

Aspen moves forward with $11M contract for property to help with future affordable housing

Carolyn Sackariason, Aspen Times
People unload a truck at Aspen Mini-Storage in the Airport Business Center earlier this month. The city of Aspen is under contract to purchase the property for $11 million. Kelsey Brunner/The Aspen Times

If all the stars align, the city of Aspen will be the new owner of a mini-storage operation and the property it sits on at the Aspen Business Center by February.

With no public comment by elected officials or citizens, Aspen City Council on Tuesday approved an $11 million purchase contract for the 3-acre parcel, which was signed by City Manager Sara Ott on Sept. 23.

The city also has put $550,000 in earnest money in an escrow account toward the purchase.

Council members first discussed the potential purchase in August in executive session and then subsequent closed-door meetings during negotiations.

After Tuesday’s meeting, Mayor Torre said the property would fit well with the city’s plans to build affordable housing on an adjacent lot.

“I think it is a smart, strategic move for the potential purchase of the property,” he said. “It really adds to the conversation of what kind of smart development we can do there.”

Torre also noted that the city has the ability to terminate the contract during a 120-day due diligence period if certain contingencies are not met, including an appraisal, title objection, environmental study or a physical inspection, among other concerns.

An appraisal is yet to be done, but will be before the contract is finalized; closing is expected in February in 2020.

The property has an actual value of $7.9 million, according to the Pitkin County Assessor’s Office.

Local businessman John Clark purchased the property in 2005 for $5.75 million, according to the assessor’s records.

The property is key to the city’s plans to build affordable housing units on the adjacent lumberyard parcel, which is roughly 7 acres.

The city bought that property, known at the time as BMC West, for $18.25 million in 2007. An appraisal after the fact showed that it was worth about $1.45 million less than what the city bought it for.

The mini-storage parcel would provide access to the future development and would better alleviate concerns related to the Colorado Access Traffic Control Plan onto Highway 82.

Chris Everson, the city’s affordable housing project manager, said last week that having 10 acres in the area gives the city more flexibility into its planning.

Harbert Lumber Co., which currently leases the BMC West property from the city for $50,000 a month, has a lease through 2025. The city can terminate that lease with 30 months’ notice, according to Everson.

The proposal for the mini storage property is that the city and the business’s current manager would manage the ongoing operation, and the leases with tenants would be on the same schedule as the existing one for the lumberyard. The monthly revenue from the tenant leases is approximately $60,000 a month, according to Everson.

csackariason@aspentimes.com