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HomeMy WebLinkAboutminutes.council.19880420Continued Meetinct Aspen City Council April 20. 1988 Mayor Stirling called the meeting to order at 5:05 p.m. with Councilmembers Fallin, Gassman, Isaac and Tuite present. ASPEN MOUNTAIN LODGE PUD Mayor Stirling said the issues Council and the applicant agreed to discuss are room count, overall square footage, height, mass of the hotel and the continued process of this application. Mayor Stirling said the Council is not to decide aesthetics but will determine, with the applicant, the issues of scale and mass. Mayor Stirling said during the previous process of the planned unit development, the Council became too focused with the issue of units. Mayor Stirling said the Council approved a compromise proposal but no one understood the magnitude of the mass. There was never a model to set the mass against. Mayor Stirling said the zoning allowed or a flexible planned unit development do not create the wholeness that is important. Mayor Stirling said organic w holeness is often not compatible with the highest and best use of a site. Mayor Stirling said the question is how to make all the components work toward a successful and balanced building, whose mass is in keeping with Aspen's organic whole- ness. John Sarpa, representing the applicant, said they appreciate having the opportunity to talk about the substantive parts of the hotel. Sarpa said in order to have a meeting of the minds, Council needs to know what is on the minds of the applicants and vice versa. Sarpa said there have been statements that this project cannot be financed. There have been statements that this number of rooms will not be successful because it is too many. Sarpa said it has been stated there are no financial guarantees in place between the applicant and the Ritz. Sarpa said it has been stated that the Ritz does not care that much about the number of rooms in the hotel. Sarpa said these are misunderstan- dings and are not true. Bill Walton, Morgan Stanley, told Council Morgan Stanley is an international investment bank with offices throughout the world. The real estate arm specializes in sales and financing of major real estate transactions. Walton told Council Morgan Stanley realty has been formally engaged to arrange the financing for Ritz Carlton Aspen. Walton said in the hotel area, Morgan Stanley focuses on well-conceived, premier luxury and resort hotels under the auspices of strong sponsorship. Walton told Council, locally, Morgan Stanley was involved in the recapitaliz- ation of the Skiing Company. Walton told Council the Ritz Carlton hotel chain is not pulling out of this project; the project is not unfinanceable, and Morgan Stanley as not resigned from the assignment. 1 Continued Meeting Aspen City Council April 20, 1988 Walton told Council his company has been actively marketing the project f or 4 weeks. Walton said they have never had as much interest in a project as they have had in this financing. Walton said they have received 3 written proposals and expect to receive 3 to 6 more written proposals. Morgan Stanley will then select a lender from the best offer and will go immediately to a commit- ment letter. Walton said the project is eminently financeable. The issue is arranging the optimum, most cost effective financ- ing. Walton said the consensus is that this hotel will be a tremendous success. Perry Harvey, representing the applicant, told Council the 1983 goals task force indicated the town needed to balance the economy between the winter 4 months and the other 8 months by 1995 to achieve a 50/50 balance between those times period and the economy in the community. This goal is designed to protect the community in no-snow years, in an economic down turn or the loss of skier share. Harvey said one conclusion in that report was the best way to increase the shoulder season and balance out the economy was a conference facility hotel. Harvey said the zoning maps designate this site as the perfect site for intensive tourist accommodations. Harvey reminded Council the Roberts plan was approved in 1985 after long negotiations based upon the need in the community for this type of facility. The PUD agreement requires the hotel have a conference facility and that management shall be high quality and shall be experienced to seek and promote conference business. Harvey said this is where the concept of the hotel came from. The room count of 447 was the process of 75 meetings. Harvey told Council last August the applicants entered into a pre- application conference with staff and stated they wanted to file an amendment because of the time involved. Harvey said the applicants were informed by staf f the way to do that was to stay within the parameters of the PUD, i.e. height, footprint, concept of a hotel. Harvey showed the initial plan, the plan they worked on by varying roof lines, by pulling the facade in and out, changing the window and balcony designs. This was the middle plan. Harvey told Council they then worked with the design community and showed the plan that was scored by P & Z. Harvey said they worked on concerns over height, setback, open space, and a pedestrian scale. Harvey said the applicants brought the Dean street facade 8 feet off the property line. The building shifted 2 feet off Monarch toward Mill street. Two sections of the building were moved in 6 feet. This gave 270 by 8 feet of additional open space. Another concern was the accessibility of the open space to the public. Harvey showed a small park at street level from Monarch street. Harvey said there was to be a mansard roof and they changed it to 2 Continued Meeting Aspen City Council __ April 20. 1988 a more traditional mountain roof by sloping it a s a 45 degree angle. Harvey showed the height from the Roberts approval and the current plan. Harvey said staff recommended the applicant proceed through the amendment process while looking at mass, height and breakup of the buildings. This was originally not to be touched in the process. Harvey pointed out the PUD is a process of negotiation, trade offs of certain benefits for the developer and benefits for the community. Harvey said for additional FAR, the community received benefits, like Koch lumber property, realignment of Mill street. Harvey told Council the owners have spent $3,500,000 on community improvements in reliance on the approval and will spent an additional $1,800,000 during construction. Harvey said the original Roberts submission was for 480 rooms. Through the process, this came to 447 rooms. Harvey said 275 lodge and 40 residential units were on the two sites, including those still remaining at the Grand Aspen hotel. Jim Pavisha, representing Ritz Carlton, told Council they are committed to this project and to running a successful hotel in Aspen. Pavisha said Ritz respects the life style in Aspen and is not trying to change it. Pavisha said Ritz wants to be good neighbors. Ritz is committed to providing an excellent product and excellent service. Pavisha said one reason Ritz is inter- ested is the approved hotel had the critical mass that appeal to their market. Pavisha said Ritz felt that the mass was appropriate for where they had to be with this property. This aligns well with their markets, which is primarily national associations, corporations and trade associations that are incentive travel oriented. Pavisha told Council mountain hotel are not easy to make work without the proper marketing alignment. Pavisha said Laventhal and Horwath confirmed Ritz's findings with some refinements. Pavisha said Ritz designed the ballroom larger than the hotel demand, which is to appeal to a broader segment of the market. Pavisha said Ritz got involved with Hadid with the understanding there was an approved plan, a certain size facility with a certain number of rooms. Pavisha told Council with these understandings, Ritz was able to give a financial guarantee to Hadid. Pavisha said Ritz felt comfortable giving this guarantee and also with the recognition this would speed up the financing of the hotel and keep the project on schedule. The guarantee pledges a certain amount of money to Hadid f or the service of debt. Walton said this guarantee is very important to the financing. Pavisha told Council Ritz is agreeable to make this document available to the city attorney, with the understanding that it not be copied, in order to give some comfort level to the Council. Mayor Stirling asked why Ritz would do this for the 3 Continued Meetinct Aspen City Council AAril 20. 1988 Aspen Mountain lodge project and not for other projects. Pavisha said there is a time pressure to get the financing in place to meet the approvals. Pavisha said Aspen is unique and Ritz sees this as the hotel in Aspen that can make a contribution to the city in bringing groups in and stabilize the economy. Pavisha told Council the guarantee is still solid. Pavisha said this is an adjustable guarantee, designed to the market and the Laventhal study. Pavisha said Ritz has not agreed to lower the room count. Ritz is committed to get the project done. Walton told Council the most important ingredient to the financing of this is the operator. Walton said the Ritz Carlton name is the most financeable operator. Sarpa told Council the applicants have a contractor with con- struction schedules. Ritz is prepared and ready to go. Sarpa said the applicants feel it would be a loss to the community to lose this momentum. Sarpa gave Council some drawings as a response to the discussions of size and mass of the hotel. Sarpa told Council they have taken 30 rooms from the main building and moved them to the Blue Spruce site. The applicants have taken 5 residential units, which equates to 25 units, from the Mill street side. The applicants have taken 55 rooms out of the building. This translates to about 30,000 square feet. The drawings show the reduction of the 30,000 square feet. Sarpa told Council the biggest concern they hav a heard from the community is the Mill street elevation. This reduction has concentrated on the Mill street elevation. Sarpa said another big concern they heard was access to the hotel's open space. Sarpa said the objective was to make a radical change in size and mass on Mill street and to provide additional open space access to the public. Sarpa showed Council the design has removed an 86 foot long section of the building. There are two separate buildings. The are passages into the courtyard. A small seating area has been put in by the lounge. There is a small conditioned arcade t o link the two buildings together. The building on the southern- most part of the split houses 100 rooms. Sarpa showed the building is approximately 40 feet shorter by taking rooms off the end of the building and putting them where the residential units were. Sarpa told Council the applicants were able to reduce the overall height by 12 feet. Sarpa said there will be one building on the Blue Spruce site with 30 rooms on it, one building at Monarch and Dean which has 162 rooms, and one building on Mill with 100 rooms. Sarpa said Ritz Carlton is comfortable with the serviceability of the plan. Sarpa showed a plan of the configuration of rooms, showing 12 guest rooms on the Dean street side and 18 guest room s on the 4 Continued Meeting Aspen Citv Council April 20. 1988 Durant side. Sarpa told Council Ritz did not want to have rooms that are below grade. The ground floor will have a retail area. Sarpa told Council these plans are to address the concerns they have heard, to make a radical reduction of scale and mass, open up the open spaces. Sarpa reiterated 30 rooms have been moved to the Blue Spruce site, 5 residential units have been rolled into phase II. In terms of scale and mass, the applicants have taken 55 rooms out or about 30,000 square feet. This is about a 30 percent reduction of the Mill street side. Harvey said as long as the room count is maintained, this will do nothing to the Ritz guarantee. Pavisha said Ritz has agreed to this conceptually. They have to make sure the design is attractive to the guests. Sarpa told Council this is a total PUD of 447 rooms. Harvey said the PUD agreement reads no more than 300 rooms and 14 residential units in phase I, and no more and 190 room and 14 residential units in phase II, with the overall no more than 447 and 14 residential units. Harvey said the PUD left the final configura- tion flexible. Harvey told Council originally there were 8 residential units on phase I. They have been moved over to phase II in an attempt to reduce the scale of the building. Sarpa told Council a residential unit in a Ritz is unbelievably marketable; they have firm offers to purchase these units. Rolling these 5 residential units into phase II takes away from the finance picture. Sarpa said there is a comparably light density on phase II. Richman showed attachment 3 indicating the density is significantly less on the east wing site and is somewhat below zoning before the 30,000 square feet. Sarpa said the plan is only to move 13,000 square feet to phase II. Sarpa said there will be about 190,000 square feet in phase I and about 130,000 square feet in phase II. Councilman Isaac said the prior plan did not have retail space on the Blue Spruce site. Richman said the Blue Spruce site co n- tained a restaurant. It seemed desirable to have some commercial frontage on Durant street. Richman pointed out the accessory retail is allowable. Harvey said there is almost not retail in the hotel, except for a ski shop and a sundry shop. Councilwoman Fallin said Ritz Carlton is only going to operate the first phase, and what the applicant does in phase II is up to them. Sarpa said the agreement covers only phase I. If the relation- ship were favorable and the market conditions indicated, the applicant would turn to Ritz Carlton first. Councilman Isaac asked if this plan changes the count of parking spaces. Harvey said this applicants have made no adjustment. The changes would reduce the parking count; however, they have no looked at this. Sarpa said there were two areas they made good progress with P & Z; parking and employee housing, and they have not gone back over these areas. Sarpa said the decision the 5 Continued Meeting Aspen City Council April 20, 1988 applicants made was to take off 40 feet of the length and bring the height down 12 feet. Councilman Gassman said this project started out with 480 rooms and through negotiations that was reduced to 447 units. Council- man Gassman said the city is stuck with that number, which came from someone else. The number of units was developed by the developer. Councilman Gassman said the number of units the Council is dealing with is a relic from an earlier plan and does not represent a lot of community involvement. Councilman Gassman said in 1985 things were different than they are now. Councilman Gassman said since that time, developers will have built 230 new quality hotel rooms. This should have done something to alle- viate the need shown in 1985. However, the developer is still working on the same number of units. Councilman Gassman said he f eels the size of the proposed hotel has not been determined through rigorous analytic thought. Sarpa said there has been intense, extensive market analysis of the number for the Ritz. Sarpa said when the applicants met with Ritz, Ritz re-analyzed their earlier marketing study. Ritz continued the presumption they had to look at the shoulder seasons, and at how much space the high end executive groups need for this type of facility. Sarpa said it was this inter- action that led Ritz to the number of 300 rooms with 20,000 square feet of conference space. Sarpa told Council in thei r negotiations with Ritz they requested Ritz to keep the number of rooms as low as they can because of the issue of scale and mass. Councilman Gassman asked how this compares with other Ritz hotels. Pavisha said most of the other Ritz hotels are in the 400 and 500 room range. Pavisha said it is more expensive for a hotel to operate in the mountains. It is also more expensive to build a hotel here. Pavisha pointed out the way Ritz runs their hotels, there has to be a critical mass to support the kind of services they provide. Harvey said the community circumstances have not changed. There will be a no snow year or an economic down turn. Harvey said 102 new units, not counting Little Nell have been created in the last few years. There are 113 units that have come out of the lodge inventory in the same time. The conference business has not been addressed. Alan Novak told Council the numbers from the original proposal were based on the same sort of analysis that has been done by the applicant and by Ritz Carlton. Novak said there was concern about leveling the Continental Inn at the same time, and the notion was to leave the Continental Inn operating. Novak told Council at that time, Laventhal and Horwath said the developer would have to have 270 to 300 rooms if it was to be a group marketed hotel. Novak reminded Council during the discus- 6 Continued Meeting Aspen City Council April 20, 1988 sions of this proposed hotel, the Jerome expansion and the Little Nell project were taken into account. Councilman Isaac said he has some concern a bout the n umber of rooms and hoped the numbers would be lowered. Councilman Isaac said he would like to see the number of rooms be around 240. Councilman Isaac said he would also like to see a process for continuing these discussions. Councilwoman Fallin said she, too, was hoping for a lower number of rooms. Councilwoman Fallin said she does like the shift of rooms. Councilwoman Fallin said she would like to see a crude model Councilwoman Fallin said the discussions about the number of rooms was in response to the needs of the community at that time. Councilwoman Fallin said the city needs to look at the needs of the future, also. Mayor Stirling pointed out that skier days are levelling out, and asked why this Ritz cannot be smaller, like the Rancho Mirage in California. Pavisha said he can have comparative figures for the next meeting. Pavisha explained that the financing at Rancho Mirage is entirely different. Pavisha said when this project was approved, the Council was looking farther into the future than 2 or 3 years. Mayor Stirling accepted there should be a hotel on this site. Mayor Stirling said there is no practical way this site can remain open space. This site is zoned lodge. Mayor Stirling said he has a philosophy for the feeling of the town. Mayor Stirling said he is not happy with 292 rooms. Mayor Stirling said Aspen is one of the really beautiful towns that exist in the world. Mayor Stirling said these towns evolve with a set of laws that govern them. Mayor Stirling said the organic wholeness of Aspen has continued to be here because of the effort and work of people in the community. Mayor Stirling said what concerns him in some developments is a long term economic loss for a whole community. Mayor Stirling said what needs to be examined is how this project can help preserve the quality of town and the quality of the life for residents and visitors. Mayor Stirling said when something is built that is larger than everything around it, the building has to have a great sensitivity in order to fit into the organic wholeness. Mayor Stirling said he would be interested in having the applicant move more mass onto phase II. Mayor Stirling said if there is a chance that this project can be done in a way that will work for the town, he will be a proponent of it. Mayor Stirling said he is still not a proponent of the current pro- posals. Mayor Stirling said he has misgivings whether this project can work effectively for the operator and for the town. Mayor Stirling said the bigger a building is, the more it has to have a timeless quality about it and blend in with the town. 7 Continued Meetin4 Aspen City Council April 20, 1988 Sarpa said the qualities mentioned by the Mayor are the qualities that brought the applicant to town. Sarpa said the applicant owns a lot of property in town and does not want to lose that quality. Mayor Stirling moved to continue this meeting to Wednesday April 27 at 5:00 p.m. with a back up date of Friday, April 29 at 4:00 p.m. and to have another continued meeting on Thursday, May 5 at 5:00 p.m.; seconded by Councilman Isaac. All in favor, motio n carried. The meeting adjourned at 6:52 p.m. Kathryn S, och, City Clerk 8