What does a city bureaucracy have to do to get a new hotel built around here?

That question is surely reverberating through Aspen’s City Hall after this year’s tumultuous relationship with a development group representing the owners of a slopeside parcel of land that has been eyed for a new hotel for at least 10 years.

Located at the top of the South Aspen Street hill near the base of Aspen Mountain’s Lift 1A, the 2.4-acre site was at one time, under a different ownership group, planned for the Lodge at Aspen Mountain. The proposal couldn’t get past City Council, however, because it was seen as being too big for Aspen’s small-town tastes. When those developers went bankrupt and lost the land, a new group swooped it up in 2010.

Crucial to the background of the story is that in 2003, the city approved a plan that would have 14 townhomes and 17 affordable housing units built on the land. But, at least according to the city’s planning staff and tourism interests in town, residential development on the prime real estate would represent a missed opportunity to strengthen the Aspen tourism infrastructure. As soon as the townhome approvals were granted, the developers were lobbied to instead bring forward a hotel. The townhome approvals have remained valid ever since as a condition of the developers going through the approval process for a hotel.

The new owners — made up of Boston and Chicago real estate investors — first told the city they could not bring forward a financially viable hotel project, and would seek to build an amended version of the townhomes approval that would need a new City Council approval. Then, after more lobbying by the city, ownership group representatives said they would try to make a hotel work.

Plans were drawn up and discussed in multiple council meetings. The hotel would have been just as big as previous versions that were rejected over size concerns, and would have included a larger component of free-market condos along with about 75 hotel rooms. As some on City Council were questioning whether such a plan was all that desirable, the developers withdrew their hotel proposal. Turns out their project would have to be even bigger for them to make a buck, or so they said.

What’s next for the land is unclear, but it looks like condos will win the day, unless someone can be convinced again to try for a hotel. Any takers?