Judge denies developer’s bid for alternate Zeppelin Station receiver

190 zeppelin zs june 300dpi scaled

Zeppelin Station is an office building in RiNo with a food hall on the first floor. (Courtesy Zeppelin Development)

A judge on Monday denied a developer’s bid to have an alternate firm named receiver of the Zeppelin Station office building in RiNo.

Judge J. Eric Elliff confirmed his previous appointment of The Stapleton Group after an hour-long hearing, which featured arguments from attorneys representing Wells Fargo and an affiliate of Denver-based Zeppelin Development.

Zeppelin completed the four-story Zeppelin Station at 3501 Wazee St. in 2018. The following year, it took out a $32 million loan on it from Wells Fargo. That loan has been in default since 2021 for failing to meet income-to-debt ratios, per Wells Fargo.

Wells Fargo asked for the appointment of The Stapleton Group in March. The banking giant and Zeppelin then feuded in the form of back-and-forth court filings for weeks before meeting on Monday in Elliff’s courtroom.

Elliff had technically already appointed The Stapleton Group as receiver on April 22. But he paused that order days later after Zeppelin noted its desire for a hearing — and that it believed a local firm would do the job better.

In Eliff’s courtroom, Buchalter attorney Khaled Tarazi, representing Wells Fargo, pushed back against Zeppelin’s argument that The Stapleton Group was too close to the lender to truly operate independently. 

Tarazi called it a “red herring argument,” saying it’s natural for lenders to know receivers because lenders are the one that determine when a receiver should be hired. No borrower goes looking for a receiver to manage their asset, he said.

Kyle Zeppelin

Kyle Zeppelin

“It’s the very nature of these types of relationships,” Tarazi said.

Zeppelin Development CEO Kyle Zeppelin sat alongside his legal team as Foster Graham Milstein & Calisher’s Michael Rollin argued that Denver-based Cordes & Co. would be a better choice as receiver, in part because the firm would be cheaper. 

“Cordes & Co. could be 40 percent, maybe more in the aggregate, less expensive,” Rollin said.

Elliff, however, ultimately told the parties that he had “no reason to second guess” Wells Fargo’s preferred firm. He noted that he will be the receiver’s boss, and can question expenses and actions taken as needed.

“The receiver is an officer of this court … and if the receiver is acting in a way other than that, I am here to address that,” Elliff said.

Elliff did award Zeppelin a minor victory, saying he would “refine” some of the wording included in his original receivership order. Zeppelin had expressed concern that the phrasing could prevent its employees from accessing their office space in the building, or even just swinging by its ground-floor food hall for lunch. 

“I think it’s a little too restrictive,” Elliff said, while cautioning that it would not be a drastic rewrite.

190 zeppelin zs june 300dpi scaled

Zeppelin Station is an office building in RiNo with a food hall on the first floor. (Courtesy Zeppelin Development)

A judge on Monday denied a developer’s bid to have an alternate firm named receiver of the Zeppelin Station office building in RiNo.

Judge J. Eric Elliff confirmed his previous appointment of The Stapleton Group after an hour-long hearing, which featured arguments from attorneys representing Wells Fargo and an affiliate of Denver-based Zeppelin Development.

Zeppelin completed the four-story Zeppelin Station at 3501 Wazee St. in 2018. The following year, it took out a $32 million loan on it from Wells Fargo. That loan has been in default since 2021 for failing to meet income-to-debt ratios, per Wells Fargo.

Wells Fargo asked for the appointment of The Stapleton Group in March. The banking giant and Zeppelin then feuded in the form of back-and-forth court filings for weeks before meeting on Monday in Elliff’s courtroom.

Elliff had technically already appointed The Stapleton Group as receiver on April 22. But he paused that order days later after Zeppelin noted its desire for a hearing — and that it believed a local firm would do the job better.

In Eliff’s courtroom, Buchalter attorney Khaled Tarazi, representing Wells Fargo, pushed back against Zeppelin’s argument that The Stapleton Group was too close to the lender to truly operate independently. 

Tarazi called it a “red herring argument,” saying it’s natural for lenders to know receivers because lenders are the one that determine when a receiver should be hired. No borrower goes looking for a receiver to manage their asset, he said.

Kyle Zeppelin

Kyle Zeppelin

“It’s the very nature of these types of relationships,” Tarazi said.

Zeppelin Development CEO Kyle Zeppelin sat alongside his legal team as Foster Graham Milstein & Calisher’s Michael Rollin argued that Denver-based Cordes & Co. would be a better choice as receiver, in part because the firm would be cheaper. 

“Cordes & Co. could be 40 percent, maybe more in the aggregate, less expensive,” Rollin said.

Elliff, however, ultimately told the parties that he had “no reason to second guess” Wells Fargo’s preferred firm. He noted that he will be the receiver’s boss, and can question expenses and actions taken as needed.

“The receiver is an officer of this court … and if the receiver is acting in a way other than that, I am here to address that,” Elliff said.

Elliff did award Zeppelin a minor victory, saying he would “refine” some of the wording included in his original receivership order. Zeppelin had expressed concern that the phrasing could prevent its employees from accessing their office space in the building, or even just swinging by its ground-floor food hall for lunch. 

“I think it’s a little too restrictive,” Elliff said, while cautioning that it would not be a drastic rewrite.

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