Plan to turn downtown Boulder parking lot into hotel moves forward

BOULDER — On a 7-1 vote Thursday evening, Boulder City Council approved a sales agreement that sets the stage for a hospitality company to buy a city-owned downtown parking lot and build a boutique hotel on the site.

The approval — Councilmember Taishya Adams was the sole official to oppose the deal — came despite concerns from congregants at First Congregational United Church of Christ, who use the 59-space lot at 2121 Broadway for services; and from a prominent local landlord, who claims the loss of parking will hurt business for his nearby commercial tenants.

Midnight Auteur LLC, a hotel developer and operator formed by leaders of the Ramble Hotel in Denver and the popular New York-born cocktail bar chain Death & Co., plan to buy the half-acre surface lot for $5.8 million and  build a 110-room hotel there. 

Local government and business leaders, along with officials from the Sundance Film Festival, have stressed the need to add more hotel rooms, especially around downtown Boulder, as the city prepares to host its first Sundance in January 2027.

But Midnight Auteur’s proposal isn’t without its skeptics. 

Rev. Christina Braudaway-Bauman told city leaders Thursday that losing parking could hurt attendance at First Congregational United Church of Christ, while Trinity Lutheran Church senior pastor Pam Challis noted that the 2121 Broadway property represents “one of the last flat lots that is available for people to use in our neighborhood.”

Midnight Auteur is led by Ryan Diggins, founder and operator of the Ramble Hotel in Denver’s River North District; David Kaplan, founder of Death & Co., which opened its Denver outpost in the Ramble nearly a decade ago; and Alex Day, chief operating officer of Los Angeles-based hospitality group Gin & Luck.

Diggins told area church congregants that was willing to “speak to every last one of you” to solicit feedback and minimize negative impacts. 

Stephen Tebo, founder of development and property management firm Tebo Properties Inc., told BizWest last month that he would lead a petition effort to dissuade the Boulder City Council from approving the parking-lot sale.

Tebo, who counts a number of storefronts near the 2121 Broadway lot among his portfolio of 250-plus commercial properties that encompass more than five million square feet of office, retail and industrial space, said that eliminating the public lot would make it more difficult for customers to access his tenants’ businesses.

Boulder’s Central Area General Improvement District manages 2,209 spaces across six parking garages and four surface lots, according to the city, which claims that a “parking study concluded that nearby garages have sufficient capacity to accommodate the parking currently provided at 2121 Broadway.”

The proposed contract between the city and the hotel operator, which still needs to be signed prior to groundbreaking, lists six perks that Midnight Auteur must provide to the community for 30 years. 

However, there are stipulations that allow Midnight to buy its way out of some of those commitments. The buyout option “caps the City’s recovery for nonperformance but also removes the cost and uncertainty of proving actual damages, and it gives the owner a known, bounded cost of noncompliance rather than open-ended liability,” the DMC memo said. “The buy-out right cannot be exercised before the fifth anniversary of closing, and the owner must otherwise meet all benefits within three years of closing — meaning the covenant is expected to be substantially in force for a minimum of two years before any release option becomes available.”

Here are the contract’s community-benefit provisions:

● The hotel must provide at least 2,000 square feet of commercial space that would be leased at no more than 75% of market value to “local, independent retail and food/beverage tenants, with a diligent marketing requirement if space sits vacant more than six cumulative months in an 18-month period.” Midnight Auteur would have to pay the city $250,000 to buyout from this requirement.

● The hotel “must include no-charge, publicly accessible food/beverage areas and a public rooftop open at least 20 hours per week; private bookings are capped at 30% of monthly operating hours, and the owner retains operational discretion (the covenant does not create a  public right to use the property as an unsupervised gathering space).” The buyout is $200,000.

● Midnight Auteur will pay a “$100,000 donation to the Boulder Arts Foundation for onsite public art, at least three rotating local-artist exhibitions per year, and a 35% local sourcing requirement for interior art installations.” The buyout is $250,000.

● The buyer must make “(g)ood-faith efforts to award at least 20% of construction contract value to certified women- and minority-owned Front Range businesses,” and must implement energy-reduction efforts. The buyout is $200,000

● “If development requires on-site parking, the owner must not interfere with historic institutional users of the lot, including cooperating to preserve safe alley access for First Congregational Church.” There is no buyout for this provision. 

● The hotel company must make “(c)ommercially reasonable efforts to work with Visit Boulder and major cultural-event organizers, including the Sundance Film Festival, on event-space availability and pricing.” There is no buyout option for this requirement, either.

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