465 North Mill Street commercial space in Aspen on Monday, Sept. 21, 2020. (Kelsey Brunner/The Aspen Times)
Kelsey Brunner/The Aspen Times

Developer Mark Hunt’s pitch to develop 61 free-market rental apartments off North Mill Street with locally serving businesses on the street level received a mixed reaction Monday from Aspen’s elected officials and planning commissioners during a sketch plan review.

The four-story, 35-foot-tall apartment building is being proposed in what is known as the service-commercial-industrial zone district that doesn’t allow residential use.

The zone was established in 1975 to accommodate commercial space deemed essential or unique to serve and support the local economy as the escalation of real estate prices started pushing them out of Aspen.

There are 22 tenants currently located in 465 and 557 N. Mill St. and they are light industrial, manufacturing, production, repair and similar service-related uses.

Hunt bought the property for $15 million in 2018 and then sued the city seven months later, claiming that ordinance 29, passed in 2016 and banned residential use, threatened the building’s potential for future redevelopment because it is “economically unviable.”

The sketch plan review enabled Hunt to have a non-binding conversation with City Council and the Planning and Zoning Commission to determine if there is a direction to move forward with an application.

“This fits in with the federal court mediation order that we’re trying to take an exit ramp off of litigation and work cooperatively with the city to find something that works for this property,” said Chris Bryan, a local attorney representing Hunt.

While Hunt cannot rely on anything that council members and planning commissioners said, as City Attorney Jim True pointed out, there was general support to keep the dialogue going despite concerns by the elected officials.

Councilwoman Rachel Richards said sacrificing crucial space for locally serving businesses for high-end, potentially high-rent apartments doesn’t sit well with her.

“I think we should continue talking and I think we should look at some rebalancing here,” she said. “Mark, I am having a hard time, you bought a piece of property zoned SCI and you’re asking for things different than SCI. … You are asking us to change most of the property to something else.

“I’m a little concerned that the apartments are going to turn into a home with suites and it’s going to be rented to a lot of ‘trustafarians’ who don’t have to work in our town at all and may not work,” she added.

Councilwoman Ann Mullins and Mayor Torre said there is too much residential compared to the SCI square footage.

The apartment building is proposed at 63,220 square feet, and the commercial component is 34,000 square feet, with 21,000 square feet dedicated for SCI businesses.

The remaining 13,100 square feet is for commercial uses like a gym or restaurant that would serve the apartment building and the general public.

“We could use rental units, the type you are proposing,” Mullins said. “I’m not sure this is the spot, or this many.”

Hunt said his development team has been in deep thought about what the best use of the site is, and trends that have emerged in the pandemic indicate that there is a demand for free-market rentals in Aspen, where there are virtually none.

It speaks to the middle, between a large gap of single-family homes that average $7 million in Aspen and deed-restricted affordable housing.

The apartments also serve as the economic driver to be able to offer commercial space for service, commercial and industrial-oriented businesses at affordable rents.

“I don’t think it’s a secret that all of us would love to have these services in our community, but when you get to the financial part of it, it’s just not sustainable,” Hunt said, noting that a car dealership or a pot farm would have a high financial value but wouldn’t serve the community or a need that is already here.

Hunt and his team envision public space around the buildings, along with a courtyard gathering area, and businesses and retail on the first floor, some of which would serve as amenities for the residents.

Council members said they would want some affordable housing on site; Hunt is proposing that it be located at 404 Park Circle, a property he owns and intends to develop for workforce apartments.

Richards pointed out that decisions council makes that are legislative in nature could be referred to voters.

“It always has to pass a public vote in this community,” she said. “I think there is merit and a lot of value and I think the devil is always in the details. … We’ll see where it goes.”

Hunt’s project is 30,000 square feet less than what is allowed under the city’s land-use code.

If the proposal doesn’t get approval, Hunt would go for the full 130,000 square feet allowed on the site for something else.

“The building is past its life span, it cannot stay there,” he said. “We are going to have to make the economics work.

“We’ll play within your rules but something will have to change down there.”

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