Mountain House Lodge: Foreclosure in Aspen, Colorado

Aspen: Erik Cavarra reports on the Mountain House Lodge Foreclosure in Aspen, Colorado.

Even though we are seeing major improvements within the marketplace, there are still distressed sales, and sellers indicating that though limited inventory for Buyers exists within Aspen & Snowmass Village, there are certainly some properties that still are behind market trends.

The Mountain House Lodge, a 26-room bed and breakfast in Aspen, is in foreclosure with an auction scheduled for late March. The sale, conducted by the Pitkin County Public Trustee, is scheduled for March 27 on the steps of the Pitkin County Courthouse. As of Nov. 5, 2012, the lodge’s owners — Mountain House Partners LLC of Breckenridge — owe Community Banks of Colorado $5.86 million on an $8.54 million loan from 2007. The owners purchased the property in 2007 for $7.98 million. Representatives of the group did not return calls seeking comment. The property has been under the control of a court-appointed receiver since November; the property also went into foreclosure that month. The owners have until March 12 to file a “notice of intent to cure,” which could stave off the foreclosure sale. The Mountain House is located at 905 E. Hopkins Ave. on a residential street a few blocks out of the downtown core. It is one of only a few remaining bed-and-breakfast-style small lodges in town. Staff at the lodge said rooms go for around $200 to $220 a night, which includes a homemade breakfast.

Aspen Mayor Mick Ireland expressed concern that a unique Aspen lodging property could be converted to something else after changing hands. Chris Bendon, who heads the city’s planning office, said a property owner at the Mountain House is under “no obligation to keep it as lodge,” but changing its use would be a complex and expensive process. The property today is too big to be a single-family home. A new owner could tear it down and build a home that would meet underlying zoning, however, Bendon said. The lodge also could theoretically be converted into a multi-family condominium building, but doing so would require subdivision approval, which would subject the owner to significant affordable housing mitigation and other fees. “That would be a long process,” Bendon said.  Bendon expressed hope that the property would remain a lodge, no matter what happens with the foreclosure sale. “There’s kind of an intrinsic Aspen experience when you stay in a lodge in a neighborhood like that,” he said.