Hotel owners, developer at odds regarding property |

Hotel owners, developer at odds regarding property

Collin Smith
A view inside the eastern stairwell that would be partially demolished and rebuilt if Elk Run Inn owners have to bring their building off its encroachment into the property just east of the hotel. One the Elk Run's owners, Randy Looper, said a ballpark estimate for the project put the cost between $50,000 and $100,000, because it is a solid concrete wall and extends to the roof.
Hans Hallgren

It’s not that Friday was different than any other day Randy and Cindy Looper opened the Elk Run Inn office for business, but it was one more day of uncertainty about their hotel’s future.

The couple has owned Elk Run for five years.

On Friday, they did what they normally do – answered phone calls, helped walk-in customers, rummaged through e-mail and stacks of hard copy paper.

Their mutt, Rascal, a Great Dane and border collie mix, was up just as early, and lounged in a large leather chair inside the front office.

Randy and Cindy know their business, and the daily routine on display Friday is an example of that.

What they don’t know is whether they’ll have a business in another five years. The Loopers fear an out-of-town developer is trying to push them out, an allegation the developer denies.

Four Hands Craig LLC, a company with an office in Carbondale, informed the couple in January – after about two years of discussions – that it plans to close on a contract in October to buy the Post Office and Freight Damaged Furniture building behind the Elk Run on Pershing Street.

Four Hands also plans to acquire the City Market property on the other side of Pershing, all in an effort to build a new, bigger City Market where the Post Office is now.

The current grocery store building would turn into a parking lot and gas station.

Originally, Elk Run was to be the site of a new commercial center, a collection of shops to accompany the new City Market.

However, the Loopers balked at the sale price offered by Four Hands representatives, including a developer named Phil Mann, Four Hands managing member.

“At least twice, Phil had mentioned that of course, being it’s City Market, he’d be more than fair with the offer,” Randy said.

However, he and his wife do not think that was the case.

“They made us an offer to buy the land, not the business,” Cindy said. “The problem is, it’s our livelihood they’d be taking, also. What they offered us is enough to pay off our loan, with a little bit extra. It didn’t even cover the equity we put into” the Elk Run.

Randy said that since he and Cindy rejected the offer, things have gotten “weird.”

A surveyor came out this summer to look at the Post Office property, which is owned by Rainier Sunwest Portfolio I, a limited partnership based in Dallas. The property includes an empty lot on the corner of Victory Way and Pershing Street, immediately east of the Elk Run.

After the surveyor was through, the Loopers were told the stairwell on the east side of their building encroached 3 feet onto the empty lot and were asked to tear it down or face potential litigation.

The Loopers said they knew about the encroachment but “assumed” – which they now admit was a mistake – the land would be grandfathered over to them because the building has been there for 60 years.

Randy said a ballpark estimate put demolition costs between $50,000 and $100,000.

Incidentally, that’s the same estimate given by their attorney, Craig’s Tom Thornberry, for how much it could cost to fight the demolition request in court.

Looking at their two options, Cindy said she is more inclined to fight.

“They’re saying, ‘Just take this arm off and put it over here, then take this arm off and put it over here, and we’ll be good,'” she said. “The bigger jerks they are, the more it makes us want to dig our feet in.”

Randy added that Four Hands also said it might build its commercial space – which potentially would go where the Elk Run is now – in the empty lot next to the hotel.

“He wants to land-lock us and box us in,” Randy said. “They’re going to put pressure on us to cave and give in to their offer. The thing that’s weird to me is I feel like it’s a big city developer : and we’re just small-time.”

Cindy agreed.

“I don’t see why we’re sacrificing a business that pays taxes and does everything it’s supposed to do for this big development, for another existing business that just wants to be bigger,” she said.

City Market officials did not return phone calls by press time.

Mann denied any effort to strong-arm anyone in Craig, including Randy and Cindy Looper.

“Absolutely not,” he said. “I will categorically deny we are trying to force them to sell. We want to be a good neighbor. We don’t want to be enemies with anyone in Craig, Colo.”

But, Mann said he has to satisfy certain conditions before he can close a deal for the land surrounding the Elk Run.

“Lenders won’t finance a property with an existing encroachment,” he said.

Randy said he doubts Mann has such problems, not only because he bought Elk Run with the encroachment, but because the building has been there for about 60 years, and it and the land around it have traded hands numerous times.

“It’s 3 feet,” Randy said. “Why are we having this fight over 3 feet for a building that’s 60 years old?”

The weirdest part, though, is it seems like they’re being watched, Randy added.

He and Cindy are in the process of renovating their hotel, which they put off for a few years waiting for Four Hands to make an offer.

The Loopers said it seems that every time they apply for a permit for the work they’re doing – such as building a rock wall along Victory Way – within a day, they receive a notice from Rainier, the company that now owns the Post Office building, to remove their materials from the property next door.

More than once, they’ve been threatened by Rainier with police action if they don’t comply, Cindy said.

Rainier never has shown the same hostility the entire time the Loopers have owned the Elk Run, they said.

Because of that, they think Four Hands is behind the aggression and pressuring Rainier to do something.

Again, Mann denied he wants to force the Loopers out of business.

“Their activities on the site are impressive,” he said. “They are stellar hotel operators. We don’t want to put a local business out.”

Mann has no control over how Rainier deals with the encroachment, he added, but he told the partnership to handle the issue before he will close the deal.

That may be difficult, considering the Loopers’ position.

“No matter what they do, we’ll still be here,” Randy said. “If we have to cut down on things, we can run this hotel by ourselves if we want to. We’re not going anywhere.”

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