It wasn’t with an eye toward big profits that Dick Volk’s father bought a commercial lot on the corner of Cooper and Galena in downtown Aspen in 1947.
Volk’s mother was pressuring her husband to buy property in Aspen as a safe place for their four kids to spend summers away from the polio epidemic in Denver, where they lived.
The family bought some residential property and, because so many properties in town were available for the price of the back taxes, acquired the corner lot for about $125 in taxes owed, plus a few bottles of whiskey.
Now one of the most prominent properties in downtown Aspen, home to Paradise Bakery and a busy courtyard that hosts music student concerts in the summer, the Volks’ lot was the town dump when they purchased it. The first building on it was a gas station, built in 1955 and leased by the Sinclair gas company for $300 per month with no rent increase for 10 years. In 1965 Sinclair renewed their lease for 20 years for a fixed $450 monthly rent.
Dick Volk, who took over managing the property after his father’s death in 1973, saw his Aspen properties increase in value by 15 percent each year for 25 years. Based on his experience running companies all over the world, this was unique.
“In terms of an investment, I see it as one of the best—it’s about as secure an investment as you can get,” Volk said of commercial property in Aspen.
Owning Pitkin County property has for some time been desirable—that’s no secret. For homeowners, it’s often a lifestyle choice first and investment second. But, like Volk, many have found that holding on to commercial property is, as one local expert put it, “just mailbox money.”
Not only have commercial properties escalated greatly in value over the years, but with the exception of a rare handful of years, tenant demand and retail business have also been consistently good in this small but internationally known resort town.
It’s no surprise that Gucci, Prada, and other designer brands have kept a regular presence in downtown Aspen boutiques—even though they have few customers outside the busiest high-season months of the year.
The Pitkin County assessor has given about 1,000 properties a “commercial” designation. The category does not include lodging buildings, but does include some downtown buildings that have a mix of retail and residential space.
In all, the properties are worth $1.4 billion. Of those 1,000 commercial buildings, 767 and $1.14 billion worth are in what the assessor considers to be “Aspen,” as opposed to Snowmass Village or Pitkin County. The 27 properties on this list are collectively worth about one-third of that, over $336 million.
With assistance from the assessor’s office, we ranked those buildings by value and then refined the list until we, and the assessor’s office, both felt we had a good list of all commercial properties over $8 million in what might be considered “central Aspen.” To be clear though, this is our list, not the assessor’s.
We also contacted owners, a commercial real estate attorney, and local commercial brokers to find out more of the story: Who owns in Aspen? For how long? And how good an investment is it?
Who owns Aspen?
Many commercial buildings are owned collectively by investors, led by a managing individual or company, and in most of those cases it’s impossible to tell through public records who exactly are the individual owners.
Others, such as the Volk Plaza Building that houses Paradise Bakery, are owned by (and in this case named after) a family. At times, the building owner and business owner are one and the same, such as Boogie’s and Wells Fargo.
The common perception locally that a handful of landlords own the bulk of downtown Aspen buildings may be blown out of proportion.
While Stephen Marcus, Tony Mazza and Frank Woods (M&W Properties), and relative newcomers Andy Hecht and Ron Garfield appear in records pertaining to eight of the top 27 properties, Aspen real estate attorney Bart Johnson said he’d be “surprised” if they control 30 percent of downtown Aspen under their various investment groups.
These five men, all well known in the local Aspen business community, don’t necessarily own the buildings under their control outright, but instead are more likely managers of the properties.
Though they usually have some ownership stake in the property, according to several experts on Aspen’s commercial scene, their greater roles are in pulling together investors in the buildings and managing those assets for them.
“People think there’s this monopolistic ownership of downtown Aspen, but that’s not necessarily true,” said Johnson, of Waas Campbell Rivera Johnson & Velasquez LLP. “Oftentimes what you’ll see in groups that buy commercial property is one person who takes a lead management role and invests themselves. It’s very common to have three or four business partners who invest in a company to buy a building, and the manager might only own [a minority percentage] of the partnership.”
The most typical vehicle for investing in commercial real estate these days, the LLC, can be structured any number of ways, Johnson explained, but most are managed by a manager—which can be yet another LLC.
The manager might have put the deal together, handles the day-to-day operations of the investment, and oftentimes has some ownership in the company and/or receives a management fee.
In an LLP (limited liability partnership), which shows up a few times on the list, a general partner acts in the role of manager and assumes more of the liability than his limited partners.
In it for the long haul
There may be no dominant way to invest in Aspen’s commercial scene, but holding on to buildings for a long time is one trend that many agree is unique to Aspen.
“There’s very little turnover,” said commercial broker Karen Setterfield, a 26-year veteran of the business. “Most people have owned their buildings for a very long time, and many have built the buildings. It shows a lot of stability.”
Of the buildings worth more than $8 million in Aspen, just fewer than half are owned by the people who built them—an impressive feat for a town otherwise full of mining- and early ski-era structures.
The Ajax Mountain Building (#1 on the list), for example, was built in 1979 by Stephen Marcus, who along with a shifting team of investors still owns the building. The Volk family probably has the longest ownership tenure on the top properties list—more than 65 years.
Commercial property in most urban centers is more typically owned by institutional investors, who buy what they believe will be profitable buildings, sometimes upgrade them, and flip them after a few years.
“I don’t see them at all in Aspen,” said Bill Small, a commercial broker with Frias Properties. “My impression is people want to own these places forever.”
Owners who got into the Aspen market decades ago, prior to the town becoming a hotbed of investment, have done very well, said Small, because “the market is in constant demand with people wanting to be here, a restricted supply, and a town surrounded by federal lands. So that’s definitely why prices have gone up. A place like Aspen is a very primo place to own commercial real estate.”
Approaching the tipping point?
In many cases, this long tenure of ownership may be coming to an end soon. As is the case with Dick Volk, a lot of property owners are aging and many are looking to settle their estates. “So at some point there’s going to be a shuffling around, so to speak,” said Small.
Those who have bought commercial properties in recent years “are paying big money to get into the market,” said Small, “and sometimes I wonder about the return on investment on those things.”
The “shuffle” may in fact be starting already. After a long economic downturn that kept prices down, more commercial property is on the market in downtown Aspen than likely have been in decades. Commercial broker Ruth Kruger counted 33 in June—10 years’ worth of supply.
And as leasable spaces are getting snapped up more quickly these days, higher rents are forcing some tenants out, as was recently reported in the local news. Harmony Scott closed her jewelry store on the Hyman Mall, and two longtime tenants of the Ute City Banque building—Bloomingbirds and the Optical Shop of Aspen, among others—left due to rising rents.
So what will it mean for Paradise Bakery and other tenants of the Volk Plaza Building if it does get sold for its current list price of $18.4 million?
It all boils down to that driving force of the free market—supply and demand. Constrained by geography and a strict land-use code, Aspen’s commercial core offers a limited supply, but its international visibility and desirability to a well-heeled crowd make for high demand.
Asked whether others have been interested in investing in his family’s building, Dick Volk said there have been many inquiries, mainly over the last 10 to 15 years. Several were from people who already held Aspen investments—so they knew the open secret.
And if he doesn’t get his asking price of $18.4 million—one he says was calculated carefully based on the building’s cash flow—Volk is fine holding onto it and continuing to reap its rewards. With a family that now includes 12 grandchildren and three great-grandchildren, it’s simply a matter of figuring out how to govern it for the next 20 years, he said.
The top 27 retail-commercial buildings in central Aspen
Editor’s notes: The values on the list below are the assessor’s estimated market value of the properties as of the latest available valuation period, which ended June 30, 2010—and don’t necessarily reflect what someone would pay for it today. We started with a list from the assessor's office of commercial properties in Pitkin County ranked by value. We then focused on "typical" retail-commercial buildings in "downtown" Aspen. We did not include lodges, or the many commercial buildings in Aspen that have multiple spaces and multiple owners. It is not a building-by-building, block-by-block assessment of the value of all commercial buildings in Aspen. In regard to the names of the buildings, we’ve used a blend of the familiar and formal names for the buildings.
Ajax Mountain building
520 E. Durant Avenue
Owner: Ajax Mountain Associates LLC, Stephen J. Marcus managing member
Notes: This building at the corner of Durant and Hunter —across the street from Gondola Plaza—comprises 22,981 square feet on two levels, including one 1,584-square-foot condo that is believed to be used for employee housing. A number of local investors have been involved in the building since Marcus built it in 1979. Among its tenants are the Aspen Skiing Co.’s ski and snowboard rental and retail shops, Ink! Coffee, and the Big Wrap.
Mill Street Plaza
205 S. Mill Street
Owner: Mill Street Plaza Associates LLC, Anthony Mazza manager
Notes: Anthony Mazza and partner Frank Woods are the pair behind M&W Properties, which manages this and several other Aspen buildings. With their investors, the two are probably the largest commercial property owners in Aspen. Built in 1982 on the corner of Mill and Hopkins, this 26,084-square-foot building (remodeled in 1990) is home to restaurants such as Cache Cache and Jimmy’s and a variety of retailers. The building also includes three deed-restricted employee housing units totaling 2,145 square.
Brand Building retail
205 S. Galena Street
Owner: Brand Building LLC, Richard W.L. Edwards manager
Notes: When it was built in 1891, the Brand Building (then called the Hyman Block after mining magnate David Hyman) was one of the largest commercial buildings in Aspen. The corner space, once home to a bank, became a service station for nearly 50 years; the building was condemned when the late Harley Baldwin bought it in 1971 for $170,000. Aspen earned its reputation as “Glitter Gulch” in part due to Baldwin, who leased spaces in the Brand and Collins Block (see #6) buildings to designer brands such as Dior and Gucci. Baldwin’s partner and heir, Richard Edwards, through his Brand Building LLC, now controls the building, also home to the Baldwin Gallery. Six condos, worth a collective $8.8 million, are also in the building, including one owned by Jeff Blau, president of the Related Companies, the owner and developer of Snowmass Base Village. *The value of the retail space is a total of the individual parcels on file with the assessor.
Aspen Grove building
525 E. Cooper Avenue
Owner: Aspen Grove Associates LLP, Frank Woods general partner
Notes: This 18,505-square-foot, two-story building was for several years mostly filled with art galleries, although now some of the larger spaces have been subdivided and are home to small retail operations. BB’s Kitchen also occupies a space. As general partner of a limited liability partnership (LLP), Woods assumes both management and full liability for the business, as well as an ownership stake. There are two limited partners in this building, which was built in 1954.
Aspen Square retail
617 E. Cooper Avenue
Owner: Aspen Square Ventures LLP, Frank Woods general partner
Notes: Woods reportedly bought the street-level retail spaces in the Aspen Square building about 25 years ago; his M&W Properties manages the space. The retail portion of the Aspen Square condo hotel includes shops and restaurants on Cooper and part of Hunter, comprising 14,246 SF. Separately assessed is another portion of the building fronting Durant Avenue, which includes Pomeroy Sports.
Collins Block/Caribou building
204 S. Mill Street
Owner: Collins Block LLC, Richard W.L. Edwards manager
Notes: With its stately Tuscan columns, the Collins Block is another historic building transformed by the late real estate developer Harley Baldwin (see also #3). It was built in 1891 and for much of its existence housed a hardware and lumber store. Baldwin bought it in 1988, renovated it, and leased it to high-end retailers, which now include Fendi and Frette among 13 separate commercial spaces. The infamous, members-only Caribou Club occupies the basement and is entered via an unmarked, brass-trimmed mahogany door on the street level. Baldwin’s partner and current owner of the building, Richard Edwards, lives in a 5,500-square-foot penthouse on the top two floors, worth $9.1 million. *The value of the retail space is a total of the individual parcels on file with the assessor.
411 E. Main Street
Owner: Cantina Building LLC, David A. Gitlitz and Lowell Meyer managers
Notes: This 23,720-SF building fronts over half a block of Main Street and includes restaurants Gisella and Asie in addition to La Cantina. It also includes second-floor offices and three apartments totaling 1,971 square feet of living space. Through various investment groups, Meyer owns five downtown buildings, including this one.
North Mill Station/Clark's Market building
300 Puppy Smith Street
Owner: Puppy Smith LLC, Frank Woods and Anthony Mazza managers
Notes: One of just two buildings in the top 27 outside the downtown core, this building is better known as the Clark’s Market building for its main tenant. Built in 1978, it comprises 29,490 square feet and also includes Ace Hardware, Sabra’s Deli, and most recently, an Aspen/Snowmass Sotheby’s International Realty office.
711 E. Cooper Avenue
Owner: City Market, Inc.
Notes: Built in 1967, this building comprises 24,000 square feet on two floors and recently underwent an extensive interior remodel. The CEO of Dillon, City Market’s parent company, owns a home in Aspen. In front of the City Market building is the only public parking lot in downtown Aspen and the land underneath it would likely be highly valued by a developer.
Cowenhaven/Ute City Banque building
501 E. Hyman Avenue
Owner: Arcade Associates LTD LLC, James E. Cox, Lafayette, CA, Owner
Notes: H.P. Cowenhaven, who built this building in 1900, came to Aspen in 1880 and became a millionaire supplying the booming silver town. The building got its current nickname from being the longtime home of the Ute City Banque restaurant (which did succeed an actual bank), whose space is now occupied by high-end retailer Burberry. Its 12,870 square feet include an interior arcade of small shops and a gallery. The Cox family also owns the Aspen Block building across Galena Street. (#13).
Mountain Plaza/Bidwell building
434 E. Cooper Avenue
Owner: Bert Bidwell Investment Corp.
Notes: Currently under contract with a listed market price of $27 million, this building is owned by the three children of Bert Bidwell, a 10th Mountain Division veteran who built the building and raised his family in Aspen. Designed by the late Aspen architect Fritz Benedict, the two-story, nearly 15,000-square-foot building sits on one of the most prominent corners in Aspen—Cooper and Galena—across Galena from Paradise Bakery. Currently home to Kemo Sabe, Le Tub and The Sports Center, it was the focus of a three-story redevelopment application that was eventually withdrawn due to opposition. A new redevelopment application that doesn’t add a third story is pending.
101 S. Mill Street
Owner: Ellie’s Building LLC), managers Andrew Hecht, Ronald Garfield, and Steven Hansen
Notes: Built on the corner of Mill and Main streets in 1886, the building was the longtime home of Elli’s of Aspen ski shop, which opened in 1954. The store was run by the late Elli Iselin (without an “e” at the end of her name, despite what public records show). Today the building is home to American National Bank. Public documents indicate that the partners took out a $4.4 million loan on the property in 2008, and sales records indicate that Hansen, Nikos Hecht and the late Art Pfister have had varying ownership positions in the 14,800-square-foot building since 1994.
The Aspen Block
427 E. Hyman Ave
Owner: James E. Cox
Notes: On the corner of the Hyman Mall and Galena St., this is one of Aspen’s most iconic buildings. It was built in 1886 and today its 15,150 square feet includes the elegant Residence Hotel, Aspen Luggage Co., and in the prominent corner space, Jetset. There is also a 1,500-square-foot apartment in the building.
210 S. Galena Street
Owner: Elks Lodge 224
Notes: Built in 1891, this stately red brick building first known as the Webber Building is often photographed with the American flag flying from its cupola and Aspen Mountain in the background. The building’s estimated commercial value comes from three of its four levels. The basement, at 6,000 square feet, is, home to the Regal nightclub. The tall ground-floor retail spaces currently occupied by the Ute Mountaineer and Marmot account for another 6,000 square feet, and offices on the second-floor are spread over 5,000 square feet. The third floor is home to the tax-exempt Elks Club, a fraternal order and charitable organization whose bar arguably has the best view in Aspen. *The value of the retail space is a total of the individual parcels on file with the assessor. The Elks bought the building for back taxes in 1912.
Hunter Plaza/Mezzaluna building
602 E. Cooper Avenue
Owner: Hunter Plaza Associates LLP, Anthony Mazza managing partner
Notes: Built in 1987 by Mazza, this building contains 16,209 square feet and is home to Mezzaluna restaurant, Galerie Maximillian, Pierre Famille jewelry store, and other upscale retail stores. Office space on the second floor affords a big view of Aspen Mountain.
534 E. Cooper Ave
Owner: Boogies Building of Aspen LLC, Leonard “Boogie” Weinglass manager
Notes: At 12,500 square feet and with its modern glass peaked façade, this building ruffled feathers when it was built in 1988—people argued it was too out of character for Aspen. There is also a 1,197-square-foot deed-restricted apartment in the building. Weinglass, who “sold” the building to an LLC of which he is still the manager, also owns its two eponymous businesses, Boogie’s Diner and Boogie’s clothing store.
Gondola ticket office building
611 E. Durant AvenueValue: $11,196,400
Owner: Aspen Skiing Company, LLC
Notes: This building is directly at the base of Aspen Mountain under the gondola and is owned by SkiCo. It has 14,687 SF of space, including 5,718 SF of office space—the ticket office—and 2,133 SF of retail space, home to the Gorsuch ski shop, on the ground floor. It also includes ski lockers for the Aspen Mtn. Club and back-of-house facilities for the Little Nell.
North Mill Street center/Aspen Velo building
465 N. Mill Street
Owner: North Mill Street Investors, including multiple general partners
Notes: This is one of two properties in the top 27 outside the downtown core and includes almost an acre-and-a-half of land. The 20,000 square feet of building space includes an eclectic mix of businesses and is restricted to service, commercial, and industrial uses by the city. Replay Sports and Aspen Velo bookend the level facing Puppy Smith Street, while the backside of the building houses a caterer and a car detail business, among others. The building has a very complicated ownership structure and has seen a lot of ownership changes recently, selling in 2006 for $10 million and then for $13.3 million in 2007. Then it was quickly sold again for $1.3 million. Managers of current general-partner LLCs include Andrew Hecht, Ron Garfield, Nikos Hecht and Steve Hansen.
409 E. Hopkins Avenue
Owner: Kandycom Inc., Arcada, CA, principals Keiichi and Yasuko Itakura
Notes: Keiichi Itakura, a molecular biology professor and researcher at the City of Hope in Duarte, Calif., and his wife Yasuko replaced a small teardown with this 15,348-square-foot building in 1995 and have owned it since then. Its name is a play on their initials: “K” and “Y”. Retail shops, including Distractions clothing shop and Buccellati jewelry store, are on the ground floor while Merrill Lynch, H &R Block and Pearl Aircraft Corp. are on the second floor. The building is between the Brand Building and Collins Block on Hopkins.
Meyer Business/Pismo building
447 E. Cooper Avenue
Owner: Meyer Business Building LLC, Guido P. Meyer manager
Notes: This building, home to the Pismo glass gallery, Aspen Goldsmith, and Mark Richards fur store, has a 5,700-square-foot basement and 4,800 square feet of ground floor retail on the Cooper Avenue mall. It also includes three free-market apartments and 1,148 square feet of employee housing upstairs. Built in 1950, it is owned by the Meyer family, which also owns the neighboring Guido Swiss Inn building, now home to Casa Tua. It’s valued at $5.8 million.
204 S. Galena Street
Owner: Colorado Cable, Little Rock, Ark./Jerald Barnett
Notes: Jerald Barnett, a post-secondary education executive, built this one-story, one-tenant building in 1992, which just sold in October 2012 for $13.25 million. It’s the third building in the new owner’s Aspen empire—Mark Hunt is a partner in the Hotel Jerome and also has the building on the Mill Street mall that houses Above the Salt restaurant. Hunt plans to demolish the 11,117-square-foot building and replace it with a new structure that would include five street-level retail spaces and a restaurant with a large outdoor dining space on a partial second story.
US Bank building
420 E. Main Street
Owner: Bankers Mortgage Corp, Grand Junction, CO
Notes: Page Spraker, a former mortgage consultant with ties to the area, is the owner of this corporation. This 14,176-foot-building on Main Street, immediately adjacent to the downtown core, includes offices on the second floor. A true bank building in form and function, it was designed by architect Sam Caudill for the National Bank of Aspen. It was built in 1954 and updated in 1985. Caudill’s firm also designed the current Pitkin County library.
Aspen Plaza/Kenichi building
533 E. Hopkins Avenue
Owner: Aspen Plaza LLC, Stephen Marcus managing member
Notes: At the corner of Hopkins and Hunter, this 11,400-square-foot building’s most well known tenant is Kenichi restaurant on the garden level. It’s also home to law and other offices on the upper floors and retail stores in the three small buildings in front of it.
312 S. Galena Street
Owner: DCGB, LLC, William Braun manager
Notes: Built during 1885 to 1887, and significantly remodeled in 1990, the building has 7,800 SF. DCGB's address is the same as Prada's corporate headquarters in New York. The building was once home to Andre’s restaurant and nightclub, which had a third-floor disco with a ceiling that opened to let snow fall in. Andre’s name is still on the building.
Wells Fargo building
119 S. Mill Street
Owner: Wells Fargo Bank
Notes: One of over 200 buildings designed by noted Aspen architect Fritz Benedict in the Aspen area, this building was designed for the Bank of Aspen and built in 1956. Benedict studied under Frank Lloyd Wright for three years and Wright's philosophy influenced his work. This 12,592-square-foot building was updated in 1970 and includes drive-through banking.
Volk Plaza/Paradise Bakery building
500 E. Cooper Avenue
Owner: Volk Plaza LLC, Richard W. Volk manager
Notes: Occupying one of Aspen’s busiest corners at Cooper and Galena, this 9,700-square-foot building includes a popular outdoor plaza to eat ice cream from Paradise Bakery, people watch, and listen to free music student performances in the summer. It was built in 1986 on the site of a former gas station (and before that, the town dump), after a failed referendum effort to get the city to condemn the lot and preserve it as open space. The Volk family has the property on the market for $18.4 million.
Aspen Sports Building
408 E Cooper Avenue
Owner: Barnett-Fyrwald Holdings Inc., Little Rock, Ark.
Notes: Jerald Barnett, who just sold the Gap building (see #21), is involved in the ownership of this building with his son-in-law, Ernie Fyrwald, an Aspen realtor. Fyrwald once owned Aspen Sports, the main tenant in this 10,942-square foot building designed by Sam Caudill.
Editor's notes: This project was done in collaboration with the Aspen Business Journal. All photos on the list taken by Brent Gardner-Smith/Aspen Journalism, except: #4 - Kim Hull/Chasing Light Media/Middle-Aged Ski Bum, #5 courtesy Aspen Square, and #6, #8, #12, #19 and #23 - Jonathan Boxer/Aspen Business Journal.