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City, Gorman outline Lumberyard closing, deed restrictions and APCHA partnership
Summary
City staff and developer Gorman told the Aspen City Council they expect a first closing for phase 0/building 1 of the Lumberyard project in late March or early April, outlined deed restrictions and a ground-lease structure that retain city land ownership and preserve affordability, and said APCHA will be admitted to the limited partnership for tax benefits.
Rob Schobert, the city’s Asset Director, introduced the Gorman development team and an expected two-stage closing schedule for the Lumberyard affordable-housing project. Kimbal Crangle of Gorman said, “For closing 1, we are talking about phase 0 and building 1 of a 104 units. The estimated total development cost of just over $141,000,000.” The developer said closing 1 would cover initial modular deposits and predevelopment costs, with construction draws paid pro rata and supported by lender inspections and lien-waiver documentation.
Schobert reviewed the legal package the council will see at the March 24 meeting: deed restrictions written to preserve affordability through foreclosure, a ground lease in which the city retains land ownership with a 14‑year initial term and an optional 20‑year extension, and an operating agreement that governs reserves, distributions and the city’s rights as a member. He told the council that the ground lease also includes a 15‑year purchase option for the city and that the special limited-partnership addendum is intended to admit APCHA to obtain property-tax exemptions that lower operating costs for the project. “Deed restrictions … ensure the affordability of all the units, in perpetuity survives foreclosure,” Schobert said.
Council members pressed Gorman on investor controls and sale restrictions. The developer said the operating agreement requires affirmative city approval for numerous capital events and investor changes and that provisions exist to replace Gorman in the event of default during construction. Council member Bill asked for a specific restriction on developer-initiated sale until lease-up and stabilization; Gorman said staff and the city attorney have discussed such protections and will point them out in the draft documents. The developer repeated that a second closing for buildings 2 and 3 is scheduled for 2027 and that the team is pushing to start construction as soon as permits and the initial closing are complete.
Next steps: staff and Gorman will return on March 24 with substantially final closing documents and an amendment to the existing resolution for the priority units; APCHA will meet to consider a resolution to enter the limited partnership that enables the tax benefit.
