Developer: This is the best chance to ‘Finish Peak 8 the right way’
May 20, 2018
In February, no one on Breckenridge Town Council would offer a motion for development agreement for a branded luxury hotel and 100,000-plus square feet of wholly owned condominiums at the base of Peak 8, essentially rejecting the proposal without a vote.
The development team pursing the project, however, feels like the town won't see a better offer, and that miscommunication and misunderstandings played major roles in the proposal failing on its first try. Now, they're trying not to make the same mistakes a second time as they prepare to resubmit the proposal and recast the project as Breckenridge's best opportunity to "finish the base of Peak 8 the right way."
The wrong way, according to Mike Dudick, co-owner and chief executive officer of Breckenridge Grand Vacations, would be to deny his company the opportunity and allow some other developer to take over. Under that scenario, he said, the community could face much more dramatic social impacts, while losing out on the benefit package he and his team have worked so hard to put together.
"That's what we're after," Dudick said of the project. "We never really articulated that before, and I think that's a really important thing for people to understand — this is about finishing the base of Peak 8 the right way."
A question of density
At the heart of the matter is a question of density, which really boils down to square feet.
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Breckenridge Grand Vacations is pursuing the project with the Miami-based firm Lionheart Capital. Breckenridge Ski Resort, owned by Vail Resorts, isn't a part of the development team, but the resort does own the land on which the hotel and condos would be built and has agreed to sell it under the condition its subsidiary, RockResorts, manages the hotel once built.
The developers previously sought to buy $5.2 million worth of transferable density rights — an unprecedented ask — from the town through a local program designed to preserve open space in the backcountry.
The proposal first surfaced in November, and even though council voted in favor of a sharp increase in the price of transferrable-density rights during the ensuing back-and-forth negotiations, the developers scrapped every one of their requests holding up the project except for that one, which they said is necessary to make the project financially viable.
At the mayor's suggestion, the developers have since worked a deal with Vail Resorts, in which the added density would come off the resort's in-town parking lots, thus negating the purchase from the town. As a result of that, there would be no net gain for the allowable density in town, Dudick said.
Rather if the town will approve his request for additional density this go-round, he thinks the bigger question is what could happen with the density that's already there.
'A binary choice'
Echoing Councilman Gary Gallagher's statements from last week's State of the Town address, Dudick thinks the land at the base of Peak 8 is far too valuable for Vail Resorts to sit on it. If only for the view, it might be "the best parcel at the base of Peak 8," he said.
The issue came up at the State of the Town after someone in the gallery posed a question about why Breckenridge "needs" a four-star hotel, but it's not so much about the need as it is about private property rights.
The way that density works, the parcel at the base of Peak 8, currently has all the density rights a developer would need to build a hotel with up to 300 rooms at 325 square feet per room, Dudick said.
The rooms would be much smaller than what he's proposing, and there wouldn't be any condos, but the potential impacts could be much greater without any of the benefits.
"In the binary world of what you get vs. what you don't get," Dudick explained, Breckenridge could end up seeing more traffic on Ski Hill Road, a cannibalization of other business's employees and no new workforce-housing units. What's more is that as long as they stay within the town's building requirements, there wouldn't be a development agreement for the town to leverage any of the public benefits.
about the beni's
The developers are guaranteeing the hotel and condos will come with a host of community benefits, and that might be their strongest selling point.
Listing them off, Dudick said they're going to guarantee the project won't exceed a "red line" for height. Breckenridge planning code is somewhat flexible regarding height requirements but Dudick said the hotel project won't go any taller than One Ski Hill Place, the tallest building at the Base of Peak 8, even though a developer could likely get one approved through the town's planning process.
Dudick also said they plan to abandon Sawmill Run Road, which cuts through a residential neighborhood to access Vail Resorts administration building, which currently sits on the site. The route is trafficked by hundreds of cars every day, but being "a good neighbor" means "listening to what those folks behind this property would like" to see in the project, according to Dudick.
In addition to that, they're also proposing a $125,000 donation for the preservation of Cucumber Gulch or to be spent at the town's discretion. They've also worked out a deal with the Breckenridge Outdoor Education Center to offer the center's guests use of ADA parking spaces inside the facility, giving disabled skiers better access to the mountain than ever before.
Furthermore, Dudick said the hotel is expected to generate about $1 million annually in incremental sales and lodging tax revenue and provide professional advancement opportunities for young people looking to come to or stay in the community.
"There may be some people in the community who don't like (the idea of a hotel), but given the choices — you can have a laundry list of things that are good for the community vs. zero from another developer — I think we're the clear choice that benefits the community," Dudick said.
A path to passage?
If the developers can secure Councilwoman Wendy Wolfe's support, they could see a clear path for approval of the development agreement as at least three other elected officials have offered statements suggesting they could be "yes" votes, too.
Another voting member of town council, Mayor Eric Mamula, pitched the idea of the development team approaching Vail Resorts about stripping the added density off the resorts' parking lots. Initially, Vail Resorts rejected the idea, but the developers have since worked out a deal with the resort to buy the density, and that could help earn Mamula's support.
Detailing exactly what it would take to get her vote, Wolfe has laid out three stipulations she said must be addressed before she can favor the development agreement. She wants guarantees that Ski Hill Road won't be further degraded by the project and that any workforce-housing units will be new ones and not cannibalized from somewhere else in town. Other than that, Wolfe said the project must be fully vetted by the community.
To answer Wolfe's calls, Dudick said they will commit to buying additional shuttles and offset any traffic impact over what they're projecting as "a backstop for the town."
Addressing concerns over employee housing, Dudick offered that Breckenridge Grand Vacations signed a lease last week to have his company participate in the construction of 24 new workforce-housing rental units, and his goal is "to go into town council on June 26 with 112 new workforce-housing bedrooms on the table."
To give the community a chance to vet the proposal, there will be two upcoming open houses, one from 11 a.m. to 2 p.m. June 4 at the South Branch of the Summit County Library in Breckenridge and another from 4-7 p.m. June 12 at the Grand Colorado on Peak 8, in addition to mailers and a new informational website, Finish8.com, that's underdevelopment.
Talking about where he thinks he might get the necessary votes, Dudick sidestepped the question and expressed his hope it will be unanimous.
"I understand that, technically, we need four votes in order to approve the development agreement," he said. "But from a community standpoint, I think it's more important we have broad-based support on town council and broad-based support in the community. That's what we're after. I'm not just going for four votes; I want them all."