Tom Ross/Steamboat Homefinder

07-23-2010

Nearly three years after construction liens brought progress at Hayden’s Lake Village subdivision to an abrupt halt, 72 building lots on the town’s south side are back on the market for a combined $2 million.

“This is an opportunity to purchase the entire subdivision for less than it would cost just to put in the infrastructure — roads, utilities and engineering,” Stephan Baden, of Prudential Steamboat Realty, said last week. He has co-listed the property with Hayden-based Vonnie Frentress, of Colorado Group Realty.

The average price per lot works out to $27,777. Original listing prices in 2007 ranged from $60,000 to $85,000, and 10 lots sold at auction in the mid-$40,000s.

Baden stressed that all of the government entitlements — including the final subdivision plat — are in place, outstanding liens have been cured and prospective developers can expect to obtain clear title to the lots.

Lake Village was to have been just one part in a collection of subdivisions being undertaken by a consortium of developers, and in 2006, Hayden appeared to be the next growth center in the Yampa Valley. The Lake View subdivision, now owned by the Federal Deposit Insurance Corp., would have added another 150 lots just to the west of Lake Village. But no work has begun on that project, and the future of the neighborhood appears to be over the horizon.

Things began to unravel at Lake Village in late summer 2008 when Oregon-based Robinson Construction filed liens against Mountain Adventure Property Investments, saying it hadn’t been paid more than $2 million for infrastructure work already completed on the project. MAPI and co-investors 4-S Development and Grassy Creek Holding Co. subsequently filed for bankruptcy.

Outgoing Hayden Town Manager Russ Martin said when the project came apart, it was sudden and bewildering.

“During a three-week period in the summer of ’07, the town went, ‘What happened?’ and ‘Where did it go?’” Martin said. “Almost overnight, it became virtually impossible for anyone locally to know for certain who was calling the shots on the fate of the subdivision that represented a big part of the town’s future.”

What was particularly frustrating, Martin said, was that had the developers not come back to the town with so many iterations of the project in the design phase, they might have successfully delivered it to market in advance of the recession and the retreat of real estate prices in the Yampa Valley.

“If they’d (released the lots for sale) six months earlier, I think there might be 20 homes out here right now,” Martin said.

Rodney McGowen, chairman of Hayden’s Economic Development Commission, said he remains concerned for the 10 lot owners at Lake Village who purchased their property at auction and subsequently had liens placed on their lots. The result is that they’ve been unable to borrow money to do anything with the encumbered lots.

“It bothers me,” McGowen said. “These poor folks bought lots in good faith, expecting they’d have some value in their property. They have mechanics liens on them so they can’t go get a loan to build a house.”

McGowen has a personal interest in the bankruptcy of MAPI and its affiliated development entities — he bought a more expensive building lot in another MAPI subdivision, Hidden Springs, and built a home on it. He said he loves his home but still feels hampered by the lien, which Robinson has offered to settle for $20,000.

“I’d love to refinance my home at current interest rates but can’t because of the lien,” he said.

A new beginning?

The latest development in the seven-year development saga for the town of about 1,700 people represents a potential turnaround for Hayden. Frentress is optimistic that Lake Village will attract families who will be assimilated into the community. 

“As a Hayden person, I feel like the clouds have lifted,” Frentress said. “I think of Hayden as Americana — we have a garden club and a chamber of commerce. We have a skateboard park, fairgrounds and a racetrack. I talk to people who are wanting to get their children into the Hayden schools.”

Martin agreed, saying that more Hayden residents than many would guess — about 40 percent — work in town or nearby rather than commuting to Craig or Steamboat.

Martin added that he thinks Lake Village, working in concert with Dry Creek Village to the east and the more established Sagewood, will restore the housing choices that people seek after an economic recovery.

“You should be able to come to Hayden now and have all kinds of housing choices,” Martin said.

Martin said the diverse nature of the subdivisions was deliberate.

“Our planning commissioner deliberately created two types of subdivisions, one more suburban like Lake Village, with a paved walking path, tree lawns between the sidewalk and roadway, larger lots and homes that back up to each other. That’s in contrast to Dry Creek, where it’s a much more rural setting with open space attached to some of the lots.”

He added that the town has accepted the public park at Lake Village and responsibility for its irrigation and maintenance. Similarly, the town clears the subdivision’s walking path of snow. And several blocks away, construction crews were working this week to pave a new sidewalk linking Hayden’s downtown with the public path at Lake Village. 

Martin added that the town made a video inspection of the water and sewer lines in the development in summer 2009, and he’s confident that the infrastructure is sound, principally because town government was firm about bonding the construction and stood its ground, telling Robinson that if the contractor didn’t satisfactorily complete the subdivision infrastructure, the town would invoke the bond and do so itself.

Baden said architectural guidelines remain in place at Lake Village, and Vectra is forming a homeowners association in anticipation of someday turning it over to residents of the subdivision. The bank will consider selling groups of as few as 10 lots at the subdivision, with price negotiable based upon the desired lots.