RIVER RUN COLORADO - FREQUENTLY ASKED QUESTIONS
IMPORTANT NOTE: This FAQ replaces earlier FAQs on this website. There have been substantive changes to the FAQ. Earlier versions should not be relied upon. This FAQ is provided as a convenience to persons interested in acquiring a home at River Run. It is not intended as a substitute for full and careful review of all documents related to such purchase, including the Purchase and Sale Agreement for a home and the Parcel Ground Lease for a parcel of land. Information contained in this FAQ is non-binding and subject to the terms of the actual documents governing the purchase. This information is subject to change without notice.
Revised December 2021
Benefits to Home Buyers of the Long-Term Land Lease Model
The Benefits Explained
River Run Colorado (RRC) is the most affordable residential community on Colorado’s Western Slope. This affordability is directly linked to our unique, long-term land lease model.
Simply stated, RRC IS NOT in the business of selling homes and land for profit. Rather, RRC IS in the business of creating a high-quality, income producing residential community of 70 satisfied homeowners who are also land lessees.
RRC has made a multimillion-dollar investment in land and infrastructure. A traditional home developer would seek to recover this investment by marking up both the land and the home to buyers. It is RRC’s long-term land lease model that allows it to sell the homes at cost, without requiring the buyer to purchase the expensive land, and to recover its investment and profit over the term of the land lease.
When they purchase a River Run Colorado home…
- Home buyers do not pay for their proportionate share of the valuable land on which the development is built – neither the common area land or the land under their own homes…
- Home buyers do not pay for their proportionate share of the expensive infrastructure that supports the community…
- Home buyers do not pay any builder profit mark-up on their homes…
- Home buyers do not pay any HOA fees or assessments.
Each home buyer enters into a 60-year “parcel ground lease”. The homeowner is free to sell the home at any time after purchase, and the purchaser will take over the remaining term of the lease. The initial lease rate is $650 per month, of which approximately half should be considered as compensation to RRC for the community management and maintenance that it provides to River Run Colorado homeowners, while the other half compensates RRC for its investment in land and infrastructure over the term of the lease.
The first lease payment is be billed upon the closing of the purchase of each home, and the initial $650 monthly land lease rate is fixed for three years from that date. Starting in the fourth year of the lease, RRC may increase the annual rent by a percentage not to exceed the most recently determined annual Consumer Price Index for All Urban Consumers for Colorado’s Denver-Aurora-Lakewood, Colorado, metropolitan area.
The Benefits Quantified
For River Run Colorado homebuyers in general –
- They will buy their home (without land) for a price that is about 75% of what they would pay if the builder charged “market price”, a saving at current market prices on the order of $40,000.
- They would save on the order of $120,000 by not being forced to buy the land with the home, because the combined cost of the home and land could be as much as $270,000, at current market prices.
- That $120,000 saving, invested at just 4%, would yield $4,800 per annum, more than enough to offset the portion of the annual lease payment that provides RRC’s return on investment.
For homeowners who borrow money to buy their homes —
- They will finance on the order of $130,000 rather than the $230,000 that would be required if the land were included, making it easier for them to qualify for financing, and resulting in significantly lower monthly mortgage payments.
- A smaller amount financed means a much smaller down payment requirement that could currently be as little as $6,000, depending on the lender and type of loan.
- At an assumed interest rate of 3.5%, a thirty-year fixed rate mortgage of $130,000 would cost the borrower on the order of $584 per month, compared to $1,033 for a mortgage of $230,000.
- Adding the monthly lease payment of $650 to the $584 monthly mortgage payment on a $130,000 loan, comes to a very affordable total of only $1,234 per month.
- Compare this $1,234 total to what is being asked for rental properties in Glenwood Springs and surrounding towns, and you will see how attractive RRC’s long-term lease model really is.
- Qualified purchasers of River Run Colorado homes have obtained Conventional, FHA and VA 30-year fixed rate mortgages, and down payment assistance may be available from the Colorado Finance and Housing Authority (CHFA) for qualified first-time home buyers. Rate locks for up to one year may be available.
A Final Thought
The “small” homes at River Run Colorado are designed and built to stand the test of time far better than similarly sized modular, manufactured, or park model homes to which they are frequently compared. Additionally, they incorporate features and materials not normally found in homes of their size and price. Accordingly, we expect that the value of a well-maintained River Run Colorado home will keep pace with the appreciation of larger homes in the area.
What does the monthly parcel ground lease cover?
The lease payment covers community management services and maintenance, including road maintenance, irrigation and fertilization, plus maintenance of plants, trees and shrubs on common areas and individual leased parcels. Leaf and snow removal on common areas is also included. River Run Colorado provides a large, fenced dog park exclusively for home owners, and home owners have access to the Colorado River and the KOA boat ramp.
What recurring expenses will home owners incur?
In addition to the $650 per month parcel ground lease charge that is fixed for the first three-years of the lease term, home owners are responsible for maintaining annual home insurance and for paying real estate taxes on the assessed value of the home (the Developer pays real estate taxes on the land value). Electricity is provided by Excel Energy and is individually metered and billed to homeowners by the Developer. Additionally, homeowners are responsible for monthly water, sewer and trash pick-up charges from the Town of Silt. Conduit will be available at each home parcel for connection to Comcast services, including cable TV, internet and landline phone service at the homeowner’s option and additional cost.
Who is the Developer of River Run Colorado?
River Run Colorado QOZB LLC (RRC), a qualified opportunity zone business, is the Developer of the River Run Colorado residential community that is adjacent to the associated “Glenwood Springs West/Colorado River KOA Holiday”, both located in the Town of Silt, Garfield County, Colorado.
What are the homes like?
- They are not modular homes or factory-built “tiny homes” on a wheeled chassis
- They are traditionally constructed homes, built on-site, on a foundation, to the International Residential Building Code
- The homes have 670 square feet of living space and a full-height second bedroom upstairs
- They have 96 square foot front and rear covered patios at ground level, plus a 198 square foot fire-pit and seating area in front of each home
- Other Features:
- A 16-foot high stone wall with a heat-generating fireplace
- Beam and rafter vaulting throughout, including the upstairs bedroom
- A walk-in closet in upper bedroom
- 125-amp electrical service
- A three-zone mini-split system offering cooling, heating and fan-only settings
- High-density spray foam insulated roof and walls
- An easy to negotiate spiral stair
- Real wood beams and trusses
- Tongue and groove wood panel interiors
- High quality appliances
- Solid surface countertops
- A 38-gallon hot water heater
- Roof gutters and downspouts
What are the dimensions and features of the homes that are now available for purchase at River Run Colorado?
- The homes are 12 feet wide and 40 feet long
- They have 670 square feet of living space and include a living/dining area, kitchen, full bathroom and bedroom on the first floor and a fully-enclosed second bedroom on the upper floor
- The homes are generously spaced 20-24 feet apart, with attractive screening landscaping provided
- A 9 foot by 65 foot driveway adequate for parking at least two vehicles in tandem
- The homes come with a refrigerator/freezer, range with oven, microwave oven, dishwasher, stack washer/dryer and surface lighting
Additional Storage Space
A self-storage facility on approximately three acres along the north and west boundaries of River Run Colorado is under consideration for development. If built, such a facility would be designed to provide frontage road screening and highway noise attenuation for residents, as well as indoor parking and self-storage of personal goods for residents and the general public.
What public transportation is available to and from River Run Colorado?
The Roaring Fork Transportation Authority provides service from the Fire House in Silt west to Rifle and east to West Glenwood and then south to Carbondale and Aspen.