Location: Home of Mary and Byron Chrisman at 4843 Country Club Way, Boulder, Colorado.

Transcription

1 BYRON CHRISMAN. Born Summary of OH 1214V. Interviewed by Marvin Woolf, 9 June 2004, for the Maria Rogers Oral History Program. This interview also is available in video format, filmed by Marvin Woolf. Summary of interview prepared by Kathleen Salzberg. (Note that this document is a very detailed summary, NOT a word-for-word transcription. For exact quotes, please listen to or watch the original interview.) Location: Home of Mary and Byron Chrisman at 4843 Country Club Way, Boulder, Colorado. BC = Byron Chrisman, interviewee MW = Marvin Woolf, interviewer (Ed. Note: Interview starts with interviewer in mid-sentence.) [A]. 00:00 Introduction. Byron Chrisman states that he was born on January 20, He is now retired. Was admitted to practice law in Colorado June Practiced for 33 years. Retired in December Also had experience with real estate development, which is the subject of this interview. MW states that they will discuss his real estate developments in chronological order. Asks that BC discuss only projects in the City and County of Boulder because these are the only areas of interest to the Oral History Program. 01:28 MW asks Chrisman to talk not only about the projects that he worked on but also the relationships that he had with the government officials planning boards and others. BC: The first project that he developed was on ground that he bought in 1994 (Ed Note: BC probably meant to say 1974), 1668 Valtec Lane, in Boulder County, which is a general industrial subdivision, possibly the only general industrial subdivision which was in the Boulder area. Most other subdivisions were light industrial or office R & D properties. This was a 30,000 sq. ft. building, built in 1974 and Started developing 30 years ago, while still practicing law full-time. 02:33 MW: What can you tell us about the changes and variances that you had to get in order to build that? BC: States that there were none: it was use-by-right; a simple process to go to the county after the working drawings were completed and had applied for a permit. County wanted to know

2 that the design and construction of the building complied with the uniform building code of the time, the electrical code, the plumbing code, mechanical code, fire safety, etc. MW: Do you remember what county officials you worked with? BC: Does not remember, because it was not a work process. The architect designed the working drawings which the contractor took over to the county building department to apply for a permit, which was issued two to four weeks later. The only governmental process issue after that was inspection of the building as it was being constructed to make sure that every phase work conformed to the plans. A final inspection on completion of the building was done before a certificate of occupancy was issued. Did not involve applying to the planning department for zoning, color of the building, or anything other that complying with the building codes. 04:47 Project number two was the property at 1401 Walnut Street, where Federal Express is in downtown Boulder. A five-story office building with a gross area of 32,000 sq. ft. That building was much more problematic, because it was in the City of Boulder. The City of Boulder had by this time decided that it wanted to ensure that buildings should be aesthetically pleasing. This was something that BC and a lot of others were not used to. City was not concerned with building and zoning codes, such as set-backs, heights, etc. The southwest corner of the building has a plaza, which was required by the City because they thought that it made the building more aesthetically pleasing. Turns out that this has been a nightmare for BC and co-owners because it is a great place for trash to collect. It is difficult to grow vegetation in there. Finally gave up about 10 years ago trying to grow stuff, in spite of installation of a sprinkler system. This was BC s first experience, 24 years ago, with the City saying that they had a right to say how a building looked. 07:08 MW: Other experience of working with the City? BC: Swede Johnson, one of his partners, had a fairly good rapport with the City Planning officials and the City Council. He was the one who went through the process; BC did not go to a single meeting, but knows that it was a very difficult process. It was not a use-by-right, primarily because they were asking to build a five-story building (55 feet high) rather than a building that did not exceed 35 feet high. In order to do this, had to obtain a variance from the City. Thus they had to do what the City wanted, such as adding artwork, a plaza. But BC himself did not have any direct connection with the planning process. MW: Was there any economic impact from the City s requirements that raised the cost of the building in any way? BC: Cost of the building was not significantly more expensive because of the plaza, but it certainly impacted the cost, maybe two or three percent. 09:04 MW: What was the next project that you worked on? BC: Had bought four lots in Twin Lakes Technological Park which is in Gunbarrel, which is in

3 the City of Boulder. Boulder had annexed this area as part of, he thinks, the Flagpole annexation that was done when IBM came to Boulder at Highway 52 and the Diagonal Highway (Highway 119). Believes that Twin Lakes Technological Park and Gunbarrel shopping center were included in the City as part of that annexation. MW: Could you give us the year that you were working on this? BC: He bought the land, four lots, in 1978 and started building the first building in January or February This was a 27,300 sq. ft. building. Leased to Hines Snowbridge, a company that manufactured backpacks and other packing gear, in July All of the technological park was use-by-right. City had no say in what you built or how you built it so long as it complied with the building codes. Subsequently built another building in 1981, at 4665 Nautilus Court South, which was a little over 37,000 sq. ft. Also use-by right. Same process that they went through with the county to build their first building (Valtec Lane). Architect drew the working drawings; contractor applied for building permit; a week or two after application the permit was issued; building began; inspectors signed off on each element of construction as work went along. The third, a 26,000 sq. ft. building, was built in Same building process occurred no zoning questions or public hearings, etc. Same thing with the fourth building in Between 1984 and 1994 there was a severe downturn in real estate and the demand for commercial real estate did not turn around until a bit before Did not develop anything until 1994 although bought some property between 1984 and 1994, including the old Turnpike Ford property, at 1668 Exposition Drive, which they bought in 1991 from Resolution Trust Corporation (RTC), the federal corporation that was set up to manage the real estate that they had acquired from banks and savings and loan associations that had gone broke. Leased the building to Exabyte in the fall of MW: Did you have any contact with any government officials during that acquisition regarding change of use or anything? BC: He did not. They acquired about 7 acres when they acquired the property from RTC. There were another approximately 3 acres owned by the people who owned Turnpike Ford that they acquired; also leased these to Exabyte at the same time. 15:14 MW: What was the next project? BC: Built 4601 Nautilus Court South in ,000 sq. ft building. Same process for use-by-right. MW: What use was made of the building? BC: The property is currently vacant. They have a lot of vacant real estate at present. They developed in the same year (1994) in Twin Lakes Technological Park at 6350 Nautilus Drive. Again this was use-by-right, no contact with City officials in this process. In 1995 developed 5777 Central Ave., in Flatiron Park. Acquired building permit on September 5, 1995, three hours before City Council met and passed a new resolution that limited the number of square feet of

4 industrial space that could be built in Boulder. The City Council had a really complicated system that he could not even begin to try to explain. It was adopted at about 7:30 or 8:00 pm that evening and dramatically limited the amount of additional square feet that could be built in Boulder. They were trying to stop the growth of the City of Boulder and stop the growth in jobs. MW: Did that decision have any impact on what you are doing? BC: Had they not obtained that building permit at 5:00 pm that day, they might have had to wait two to three years to develop that property. That building was built use-by-right, with no need to go to the Planning Commission or Planning Board or City Council for permission for this 60,000 sq. ft building. Started development in September Back in 1984 he did not really develop the property 3340 Mitchell Lane, in Airport West, but put together a partnership that owned and leased it out, near where NBI was. 19:26 In 1994 they developed property at th Street, directly across from the Post Office at the northeast corner of Walnut and 15th Street, where their law firm was. Swede (Johnson) was the person who worked with the City Planning staff. He knows that because he was involved with meetings with Swede and John Fay, their COO. It was not an easy process because the City felt that they should have a lot to say about how the building looked aesthetically. This process took probably 4 to 5 months before they got approval. Does not remember how much was shown on the original schematics of planters and things like that on the front of the building, but all the City required was that they put planters on the south end of the building next to the sidewalk and along the west side of the building. The City also required that two lights be put on the outside of the building out in front of them main entrance. Got a temporary Certificate of Occupancy (CO) in late September The actual CO was not issued because of the two lights that the City had required them to install and now were insisting that they be torn out. Cost $8,000 to $10,000 to install. Kept refusing to take them out, and they are still there today. Finally about 5 years ago, about 5 or 6 years after they moved into the building, the City got tired to talking to Swede and gave the final Certificate of Occupancy. They also had to go through a process to get City Council approval for a lease which is renewed every year or two (he is not sure exactly how often) because the design of the building is such that the roof overhangs the alley, 40 feet above the alley. Had to sign a lease in order to lease this air space from the City of Boulder. MW: Is there a fee for that? BC: There is a fee, but he does not know how much it is several hundred dollars a year at the time; does not know how much it is now. MW: Are there any other unusual aspects of that development? BC: No. 23:35 MW: What is next?

5 BC: Monarch Park was in He had bought the former Head Sports property at 4801 North 63rd Street. Head had closed operations in Colorado and had moved them back to Maryland. It was Head s manufacturing facility. He closed on the property on June 4, Started to clean up the building and grounds, which were a disaster, having not been maintained well at all. There was asbestos tile in the offices to be cleaned up. This is a 103,000 sq. ft. building, almost as large as the Exposition Drive property, which is 123,000 sq. ft. One of the tenants in the building at 4600 Nautilus Court South expressed an interest in leasing about 25,000 to 30,000 sq. ft. of warehouse space. Sat down, they thought, to talk about leasing the space, but the tenant expressed interest in buying the space and trading their building at 4635 Nautilus Court South, which was built by friends of BC. Occupied by Complex Tooling, but the people who owned Complex Tooling had sold the business in Complex Tooling owned the building at 4635, and were leasing the building at 4600 Nautilus Court South. Wanted to trade their building and pay cash for the difference to purchase the building at 4801 North 63rd Street. They wound up buying the property at 4600 because they has a long-term lease on it and then traded it back to BC s group along with 4635 Nautilus Court South and some cash for 4801 N 63rd Street. Building was 103,000 sq. ft., and the land area was 23 plus acres; BC traded away 12 acres and the building to Complex Tooling for the other two buildings and some cash. Took that cash in a tax-free exchange and the interviewer (Marvin Woolf) was the trustee. Bought land and built 6328 Monarch Park, a 37,000 sq. ft. building, east of IBM on Highway 52 on spec. Had to go through a process with the county. He does not think that he was involved with the county. Does not remember that the county process was really difficult; there were problems, but the architect took care of them. Did not have to go to the Planning Commission or the County Commissioners, just to the building officials for approval. At that time, as a result of his experience in Boulder, he felt that the process of getting a building permit was too difficult and complicated and that he did not want to build any more in the county. If he d only realized that this was just the tip of the iceberg, and that it was just the start of how things were going to change both in the County and the City of Boulder. Since then things have gotten much more difficult. 28:49 They kept 11 acres of the 23. Went through a subdivision process and he was involved with the planning staff. Is not sure if the City has a Planning Commission or a Planning Board. Whichever it is, they had a couple of hearings before them. Divided the 11 acres into four lots, each about 2.75 acres, to build four buildings of about 48,000 sq. ft., the optimum size for a single-tenant building, because more availability of exterior light and it is easier to get financing for smaller rather than larger buildings. That process of subdivision was extremely irritating. They said they had a process. BC believes firmly that the process was set up to slow down development and put up as many road blocks in their way as possible. The process was that you had to go through one public hearing. The City sent notice of the hearing to the public by placing it in the paper. Also they had to give written notice to anyone within maybe feet (he is not sure of the distance) of the property. Had hearing with a special committee that had been established by Council or Planning Board. Everyone on BCs side felt that this was an exercise in futility and frustration. The City officials did not know what they were doing, did not know where they wanted to go. Had absolutely nobody say one single word against the project to indicate that what they were asking for should not be approved and

6 had one letter from someone within that 300 or 500 feet that indicated that they were delighted that someone was going to develop that property to enable businesses to go in and maybe the writer could get a job there. That was the only public comment. This process had wasted about 6 weeks thus far. Then the City decided that there should be another public meeting. BC s group could only figure that the City did not like the results of the first meeting, since no one had objected. Had therefore to wait another six to eight weeks for another public meeting. BC attended those meetings. In his opinion, they served no useful purpose. This was one of the reasons that he concluded that the City was trying to slow up the project. Once through the public hearings they started through the planning process a subdivision process. The City wanted to know exactly what was to be built on each lot, despite the fact that BC s group did not even know if they were going to build on these lots. They knew the did need to subdivide and thought that they would probably build. Simply asking for permission to subdivide and possibly to build with use-by-right, i.e., the same rights that they had had across the street in Twin Lakes Technological Park. The City insisted that they needed to know exactly what the buildings would look like height, color, including submission of color samples, etc. Took about nine months from beginning of process to approval of subdivision. Should have taken about 6 to 8 weeks. Two of the lots faced Gunbarrel Ave. and two faced Longbow Ave., so there was already ready access to utilities. City made them go through an engineering process, which in 1997 cost about $25,000 to $30,000, in addition to the delay. At about that time, the City decided that they wanted to go through a down-zoning process, proposing that those 11 acres would be converted to multifamily residential surrounded on three sides by industrial. The neighboring owners would have panicked if they had thought that there would be apartments or condominiums there, because these two types of land use do not mix, in BC s opinion. Finally got it approved. Going through the building permit was a no-brainer. After that there was not further contact with anyone other than the building inspectors, who generally work well with the building contractors. 36:14 When BC was under contract to buy the old Head Sports property, at 4801 North 63rd Street, probably about March 1996, Head provided him with a huge stack of environmental reports. They knew that the property was contaminated; volatile organic compounds had been spilled and migrated into the water table. It so happened that the people hired to do the testing was the same company that BC s group had used for their phase-one tests and a couple of clean-up projects one was their law firm building at th Street, which had been a gas station. There had been a major spill of VOCs (volatile organic compounds). Had a lot of confidence in the testing company. Had an attorney in his law firm who was an environmental attorney and who reviewed the Head reports; he stated that the contamination was no real problem. In spite of that, he obtained from Head an indemnification agreement that had a 5-year term. Went ahead and closed on the property. When Complex Tooling decided that they wanted to acquire the property, they insisted on getting another environmental report. He thinks that the following happened (although he states that maybe it s paranoia): They happened to hire a company which had been founded by a former employee of the company that they had used. BC thinks that they just wanted to show Enpro (Ed. Note: presumably the name of the company he had previously used) up. Enpro had drilled about holes and done tests. The new company put about more holes in the ground and happened to hit a spot at which some 20 years ago a

7 spill took place of 1,1DCE (1,1 dichloroethylene). This is a carcinogenic compound, but the levels at the property lines were very low. Where this hole was drilled where the new concentration was found exceed the MCL, the maximum contamination limit for drinking water standard in Colorado, which is 7 parts per billion. At the hot spot it was about 260 or 270 ppb. BC says that statistically this is not very much different, but numerically it exceeds the 7 ppb, so had to be cleaned up. Voluntarily started a clean-up process with the State of Colorado in about September or October 1997, which is on-going today. 40:50 MW: What is involved in a clean-up operation? BC: Head, under their indemnification agreement, had spent about $150,000 in testing and trying to figure out how to clean up. BC led down a primrose path by the guy with whom they were working at the time in Colorado Department of Health who suggested that they use an iron reaction wall. Volatile organic compounds (VOCs) are attracted to steel and an iron reaction wall is made of steel shavings and sand. A trench is dug to bedrock for the entire length of the underground water that is contaminated. The water is supposed to flow through that. The VOCs are attracted to and are neutralized by the iron. Went through estimates of cost, etc. for 3-5 years. Finally got a new person in who knew a lot more about the problem and how to solve it. This new person said that the iron reaction wall would never accomplish what was wanted because the ground water moves so slowly, about 3-4 feet per year. The hot spot is about 300 feet from the property line. Therefore took about years to go the 300 feet to the property line where the contamination exceeded the MCLs. This person, with Cameron Cole, said the correct way to take care of the problem is to inject 3% solution of potassium permanganate into the ground to neutralize the VOCs in the groundwater. Started that process almost 2 years ago. The amount of potassium permanganate that would be neutralized by the iron and other elements in the soil was underestimated, so just last week, when BC was fishing in Wyoming, they injected 4800 gallons of potassium permanganate into 20 new holes. Expect that within 6 months they will probably be able to reduce the contamination below the allowed MCL and obtain a No Further Action letter from the State of Colorado. 44:50 MW: This property is in the City of Boulder? What role does the City of Boulder play in any of this? BC: The property is in the City of Boulder, but the City plays no role in this cleanup process, although they tried to. They wanted to know what was going on about the cleanup efforts and wanted copies of all the reports. BC told them they were not involved and was none of their concern; they could contact the Colorado Department of Health if they wanted to know what was going on. That is the last he heard from the City and has never provided copies of the reports. MW: What is the current status of the property? BC: BC s group purchased the property back from Complex Tooling in April Prior to signing the contract to buy it, they executed a lease on the entire property plus a 50,000 sq. ft. addition that the tenant wanted built. Signed a 10-year lease with Colorado Med Tech which subsequently sold the Colorado division to HEI out of Minneapolis, Minnesota. HEI has been in

8 the property since January On June 1, 2004, signed a contract to sell the building to them. MW: So the building has been occupied? BC: It has been occupied all but 5-6 months of time from October 1997 to today. MW: So the environmental problems have not prevented the use of the property? BC: No they haven t; there is no more contamination migrating off the property. Tests done in February 2004 indicate that there are no more detectable VOCs at the property line. Believes that the injections of potassium permanganate made last week that by one year from now (June 2005) there will be no contamination detectable on the entire property. 47:41 MW: What s next? BC: BC states that he does not want to get into Louisville because that is a whole other problem. He always thought that Boulder was very difficult, but Louisville is by far and away worse to try to build in. They have developed two properties there and BC has had others ask if he would develop other properties there, but his response has been that he would not develop additional property there again. MW: In what way are they difficult? BC: Cites as perfect example: the first property that he acquired in about 1998 because they had a tenant who was expanding rapidly and wanted to build a building in Louisville to be nearer to their employees, who were mainly from Broomfield and the Denver area. When BC acquired the property it had an approved PUD (Planned Unit Development) on it. The approval was for about a 32,000 sq.ft. building. The land was zone for about a 5000 sq. ft. larger building, and BC simply wanted to increase the size of the existing building by 5000 sq. ft. Went through a process with the Louisville planning staff, using the same engineering firm that the City of Louisville used, because they had also used this firm for all of their other projects. City of Louisville should have had a lot of confidence in this firm. Took them about 4-5 months to allow them to enlarge the building. Everything was exactly the same except the size of the building. Planners would respond to submitted information with a 6-10 page letter requesting that they do this, and this, and this, etc. BC would respond to them; at least 80% of the responses would be It is already on the plans. Planners did this two or three times. Thus wasted thousands and thousands of dollars and time with this process. Felt that they should have known better because they had had the same experience when they developed the project called Gateway, just southeast of 80th Street, on Macaslin Blvd. in Louisville. That took 8 or 9 months. Therefore he states that he has no desire to build in Louisville again. MW: Says that is understandable. What else have you got? BC: That may be about it.

9 52:04 MW: How would you summarize your real estate development career? BC: States that one of his frustrations in practicing law was that there is never anything tangible except a pile of papers. Does not seem like you have created anything. That was one of the reasons that he like to develop real estate. Likes to build quality projects and buildings that he is proud of. When he first started it was a use-by-right process when you did not have to go to some government official who has a different opinion as to what is an appropriate color is or what shape the building should be, or if it should be brick or clay block. Has now gone from having the ability to build what you want to some governmental official who tries to impose. This involves dealing with a government that has a lot of agendas that have nothing to do with building, such as that they want to reduce the number of jobs in the City of Boulder. Believe that something like 100,000 jobs in the City is more than there should be. Would like to figure out some way to chase these jobs out of the City of Boulder because they believe that there ought to be a balance between the number of jobs and the number of people who live in the City. Do not want the other bedroom communities sending people into the City of Boulder for work. The frustration for BC is that the City planners think that they have a good understanding of the controls, but he does not believe that they have any understanding at all. We export every day thousands of people every day who go to Denver, Erie, Lafayette, Longmont, Golden, etc. to go to work. To try to control this movement seems to be foolish. Believes that, if the planners want to control it in some way, they need to expand the City limits and allow more residential property to be built instead of eliminating the number of jobs, which BC calls stealing value from people who have already bought land for development based on current zoning codes. Now because of the separate agenda of balancing jobs and residences, government says you can no longer build a 40,000 sq. ft building (as zoned) but a 30,000 sq ft. building, drastically reducing the value of your land. He is aware of the situation because he is personally involved in Gunbarrel where they have gone to the point where in very short time they could submit a plan for a building to the City. If the application for a building permit is submitted, believes they cannot then change the law retroactively. BC s group is prepared for the minute that the City tries to down-zone the vacant land, at which time they will immediately submit an application for a building permit because down-sizing the building would reduce the value of the land from $800,000 to about $650,000, based on land prices in Gunbarrel. 58:03 MW: You said than somebody asked you if you would be interested in buying the property at 9th and Canyon to develop. What was your response? BC: That was about 12 years ago. Someone named was Simatob (forgets first name) who had bought the property. He is not sure exactly what he was going to develop the property for. This was about 20 years ago. Sometime within the last years, it was acquired by Union Leasing, he thinks; the guy s last name was Porcelli. BC was asked just before that if he was interested. Was on the market for about $1,400,000. He assumed that with all the problems that that property had had, he could buy it for about $1,200,000, so he said, No, because he believed that the City of Boulder thought that they owned that property and had their own agenda and plans for the property, about which they would not tell anybody. Everything that was applied

10 for was turned down. Porcelli (Union Leasing) bought it about 10 years ago. They got permission from the City to build about 1 year ago. City of Boulder had kept that property from being developed for about 20 years. He looked at this as a crime. City would not say what they wanted but would not let the owners build. MW: So you did not want to deal with that frustration. BC: No. Told them that if he bought the property he would sue the City of Boulder within 90 days. 60:33 MW: As a conclusion, asks if he recommend that his three sons follow the same career that he did. BC: He might recommend that they follow the same career, but not in Boulder. This career should be fun, but it is not fun fighting about whether a building should be gray or green or pink or brown. BC states that for some other government politician to substitute their judgment on what is an appropriate building for BC s judgment is wrong. They have no investment or risk. Sons should go some place else where the government is more friendly. 61:26 End of interview