The city should change existing regulations to encourage condo redevelopment so that those units are used as short-term rentals, Aspen City Council said in a work session on Tuesday.
The idea for the program came out of a lodging study that looked at the adequacy of hotel options in Aspen and suggested areas for improvement, which is one of council’s top-10 goals this year. The study is now being finalized.
About 40 percent of the city’s short-term bed base is made up of condominiums, according to the study. Those can be under-utilized because the land-use code treats traditional lodging projects differently from residential condominiums, and that has resulted in a lack of maintenance and upgrades, the study says.
The city’s regulations define units in one of two extremes — as either a lodging unit or a multi-family residential unit, said Chris Bendon, city community development director. There are a few hybrid examples, such as The Gant and the Aspen Alps, he said.
The city should come up with a new set of regulations that allow more properties to encourage people to own their unit and stay in Aspen for a few months, while still having the unit serve as a short-term rental, Bendon said.
Donnie Lee, the general manager at The Gant who attended the work session, agreed with Bendon and said that a hybrid model works. The concern is that units are either owned and residential or rented on a short-term basis to tourists, and if a property owner chooses one then he or she loses the other option, he said. However, The Gant is an example where a hot-bed base is maintained while the owners of the units still use them, Lee said.
Ultimately having both options is the best from a management standpoint, he said.
“You don’t want to have to make the projects choose,” he said.
Chuck Frias, founder of the local property management company Frias Properties, warned council that, based on his experience, the inventory of condominiums that have hybrid uses has dropped steadily over the past decade. There’s also the issue of how to maintain quality condominium units and respecting the owner’s belongings when they’re being rented out on a short-term basis.
Mayor Mick Ireland said that the trend Frias has seen is discouraging, because that means more condominium owners would rather privatize their property than make their units available for short-term rentals. That is what happened in Aspen’s West End, where owners realized it is better to maintain the quality of their property by not renting out their second homes to locals or seasonal employees, who could potentially cause costly damage, he said.
Councilmen Derek Johnson and Torre were largely quiet on the issue and Councilman Adam Frisch said filling condominiums with short-term rentals was worth looking into.
“As far as I’m concerned I don’t care who stays,” Frisch said. “I just want someone to stay.”
As a part of the lodging study, the city hosted a discussion on the topic in October where members of the hotel community — including owners, developers and managers — discussed what role, if any, the city should have in lodging development.
Attendees suggested that the land-use codes on condominiums should be changed and that existing lodges need to thrive before developing new hotels. There also needs to be an effort to seek feedback from the future visitors about what they want in a hotel experience, comments read.
Staff will begin drafting a new program addressing those issues, which will be presented to council early next year.