Last month, RiNo developer Kyle Zeppelin clashed with the receiver he never wanted appointed in the first place, pushing back against efforts to sell one of his signature projects — and hinting that ski giant Alterra might want to buy it.
At a Feb. 27 hearing, Patrick Akers of Fennemore, an attorney representing Zeppelin Development’s RiNo Tod LLC, argued that the court-appointed Stapleton Group should not be attempting to find a buyer for the Zeppelin Station building at 3501 Wazee St.
“It is wholly inappropriate to market a property that could not get to the finish line — it’s a waste of time and money,” Akers said.
The four-story, 100,000-square-foot Zeppelin Station building, which has a food hall on the ground floor, was completed in 2018. Stapleton Group has overseen it since last spring. The firm was appointed as receiver at the request of Wells Fargo, which lent Zeppelin Development $32 million in 2019. That loan is in default.
Before Stapleton’s appointment, Zeppelin Development argued that the building shouldn’t be placed into receivership — and that, if it was, a different firm should be hired. Those arguments were unsuccessful.
In a January court filing, which covered what Stapleton had done in December, the firm said it had hired JLL to market the property for sale. A listing was subsequently posted on JLL’s website.
On Feb. 5, however, Zeppelin wrote that it had concerns about what Stapleton was doing.
Those concerns were largely explained in court filings hidden from public view. But one public filing indicates that Zeppelin requested, and received, a copy of communications between the receiver and Alterra Mountain Co.
Alterra, the firm behind skiing’s Ikon Pass, has headquarters in Zeppelin Station and is the building’s largest tenant. In 2022, however, the firm listed its space there for sublease. No deal has materialized, but the listing indicated that Alterra was considering leaving the building, at least at that time.
Zeppelin’s concerns prompted a court date Feb. 27. Appearing before Judge A. Bruce Jones, Akers argued that Stapleton was supposed to maintain the status quo. He said Stapleton didn’t have the authority to market the building for sale without a judge explicitly ordering the firm to do so.
An attorney for Stapleton, Kevin Walton of Snell & Wilmer, argued that Zeppelin Development had tried to sell Zeppelin Station before the building entered receivership — and thus marketing it was indeed maintaining the status quo.
Asked by Jones what the downside of marketing the building might be, Akers said it could result in a loss of leverage if a major tenant were interested in buying the building — a clear reference to Alterra.
A spokeswoman for Alterra didn’t respond to BusinessDen when asked if the company was interested in buying Zeppelin Station.
Jones ultimately split the difference. He said Stapleton could be “putting out feelers, testing the market,” but the firm needs to come back to him if it reaches a point “where the receiver is recommending we go forward with a sale.”
Akers declined to comment after the hearing. Zeppelin didn’t respond to requests for comment.
Zeppelin switched up his legal team in the middle of the clash with Stapleton. He was originally represented by Foster Graham Milstein & Calisher before Akers and Patrick Healey of Fennemore stepped in.
Hiring JLL to market Zeppelin Station isn’t all the receiver has done. It also signed a lease with Josh Schmitz of Ruckus Hospitality for the food hall space. Schmitz is bringing in animatronic dinosaurs.
Get more real estate and business news by signing up for our weekly newsletter, On the Block.