HomeMy WebLinkAboutminutes.council.19860923Continued Meeting ___Aspen Citv Council September 23, 1986
Mayor Stirling called the continued meeting to order at 1:10 p. m.
with Councilmembers Isaac, Walls, Fall in and Collins present.
REQUEST FOR ENCROACHMENT - Volk Property
Councilman Isaac said he made a site inspection. The property
manager said the meter cannot be put inside the building, and it
would be inappropriate in the open space outside a new building.
Councilman Isaac said he feels the proposed location in the alley
i s the proper place . Councilwoman Walls said she would rather
see a creative solution for the placement of this meter. Bruce
Sutherland, architect, told Council the meter for this site has
been set behind the Cooper Street Pier, where previous meters for
this property had been located. The Cooper Street Pier then told
them there was no easement for a meter and it had to be
relocated. Sutherland said the options are to place this front
of the building, which is unsightly and may not be read by the
gas company, or to put it in the alley. Sutherland told Council
the gas company would prefer this in the alley for ease of
maintenance.
Jay Hammond, city engineer, said he feels there ought to be a
creative solution to place the meter on the building frontage.
Hammond pointed out this is not a formal encroachment request;
the applicant has not filed a formal request. This is a request
for Council direction. Sutherland told Council it is possible
to locate this on the front of the building but is an aesthetic
problem. If something were to go wrong with the meter, they will
have to dig up the front of the building, sidewalk, and
landscaping. Mayor Stirling suggested staff work with Don
Fleisher, and approach the owner of the Cooper Street Pier to see
if the meter can be located on that building.
Mayor Stirling moved to continue the meeting to September 24,
1986 at 1:00 p.m.; seconded by Councilman Isaac. All in favor,
motion carried.
RED ROOF INNS
Bob Anderson, city manager, reminded Council Red Roof Inns is
buying property from the city; a payment is due soon and they
have indicated they do not intend to pay the payment. Finance
Director, Cindy Shafer, told Council the payment is principle and
interest around $600 , 000. Anderson told Council the city has
been contacted by both Red Roof and Dick Butera to look at the
possibility of Butera purchasing the property. Anderson told
Council Butera feels the property is not worth as much as Red
Roof owes the city. Butera does not feel this property would be
economically feasible under the amount the terms owned the city.
The interest is 10 percent and is paid in large payments. Butera
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Continued Meetincr Aspen__City Council September 23 , 1906
has pointed out private financing would be difficult because of
the background of the lodge and its lack of success.
Anderson reminded Council the sale of this property to Red Roof
Inn went to the electorate and was approved. Red Roof Inn does
not feel it is worthwhile to operate this property and is willing
to let this slide back to city ownership. Anderson told Council
staff has been working with Red Roof to see if there is away for
them to sell this property to Dick Butera in a manner which would
work for everyone. Anderson pointed out Red Roof has an
investment in furniture and fixtures. If Red Roof markets that
furniture, the city has no claim on the furniture, and it adds
Jiff iculty in marketing the property. Anderson told Council
Butera has an option to purchase the furniture at $200,000.
Anderson stated one possibility is to allow Red Roof inn to
refinance the loan. Anderson said the city does not have a
formal appraisal nor an opinion of value. Anderson said in some
informal discussions, it appears that the property is valued at
less than the $2,500,000 the city originally received. The city
has received $500,000 and Red Roof is willing to give the
property back to the city rather than pay $2,000,000.
Dick Butera suggested Council schedule a site visit for the
property, the rooms have fallen below standard. The roof is
leakhing and the bid to fix it is at least $65,000. There is no
telephone system, which would cost about $30,000 to replace. The
swimming pool is not usable and would cost $20,000 to repair.
The plumbing problems need to bee corrected. Butera told Council
about 5250,000 is needed to bring the property up to standards.
Butera told Council this is a difficult property; it is not in a
good location for winter tourists and the layout is very poor.
Butera said the lodge should be restructured. A 50 room hotel in
a resort does not work economically.
Butera told Council he plans to use nationally prominent people
to makes this a sports learning center, to teach golf, tennis,
soccer, skiing etc. using the most modern techniques. Butera
said he feels this would be a nationally acclaimed sports
learning center. Butera told Council this property is not worth
52,000,000 and proof is that the Red Roof Inn is walking away
from the property. Butera said revenues cannot be generated to
cover the revenues. Butera said he will pay 52,000,000; however,
it will cost at least 5500,000 up front to open the property.
This would bring the value to 51,500,000. Butera said opening
this up to bid would take a year, and the lodge would be closed
over Christmas. This may cause more damage than there already
is. Butera said they discussed adjusting the interest rate to
help the feasibility of the loan. Butera told Council the tax
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Continued Meetinq - Aspen City Council September 23, 1986
advantages of resort hotels will be gone as of December 31, 1986.
Bob Grueter, representing Red Roof Inns, told Council he has
discussed the sale of Red Roof with 10 or 15 people and there has
been no interest. Councilwoman Fallin asked if the city has
anything in writing that the Red Roof wants the city to take the
property back. Taddune said if the city takes the property back
through foreclosure, they may want to put this out to bid. If
Red Roof comes to the city and requests the note be renegotiated
and passes the note on to a purchaser, this may be in the best
interest of the city and may be more workable. Mayor Stirling
said the city holds the note and has to consent to a restructured
note to a possible purchaser. Mayor Stirling agreed time is of
the essence, and Council's choice is to take this opportunity or
wait through another winter and bid this property out. Butera
told Council the f ormer owner 1 o st a 1 of of money on the
property. Councilman Isaac said he would like to continue
negotiations, and asked if the city has made a counter offer.
Mayor Stirling said the city has not done this formally but does
have some options outlined by the city manager. Councilman Isaac
agreed he would 1 ike to see the lodge operating this winter.
Councilmembers Walls and Fallin agreed. Mayor Stirling suggested
City Manager Anderson continue negotiations and continue this
meeting to September 24th at 1:00 p.m. Mayor Stirling said the
offer of 3 percent interest is about 2-3/4 below the T-bill rate
and does not want the city to have to wait 5 years for the
balloon payment .
Council continued the meeting to 1:00 p.m. September 24, 1986.
~~~~
Kathryn Koch, City Clerk
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