The nonprofit Cottonwood Artists' School, which operates the Cottonwood Center for the Arts, has been hit with a foreclosure notice on its downtown building where artists rent studio space and conduct classes and workshops.
The Cottonwood Artists' School owes $2.6 million toward its $3.6 million purchase in 2008 of a two-story, nearly 36,000-square-foot building at 427 E. Colorado Ave., according to a foreclosure notice filed Friday with the El Paso County Public Trustee's Office.
The foreclosure action was brought by Colorado Springs landowner Elmer J. Herbertson, the building's previous owner, who apparently was financing the group's purchase of the property, based on El Paso County records.
David Lord, Cottonwood's board president, said he was unaware that the nonprofit was "in violation of our obligations to the Herbertson family." Cottonwood officials hope to meet with an attorney for Herbertson to better understand the situation, he said.
Bill Mahaffey, a Springs attorney and board secretary for the Cottonwood Artists' School, declined to comment other than to say he expects the foreclosure to be resolved.
"We expect to be able to reach some kind of resolution to this matter," he said.
In an email, Mahaffey said a call by The Gazette asking about the foreclosure notice was "the first that any board member had heard that a foreclosure action had been commenced" on the Cottonwood Artists' School property.
Herbertson, who owns other parcels near the school property, according to land records, couldn't be reached for comment Friday. Lyndsay Ressler, Herbertson's attorney, declined to comment because she hadn't yet talked with her client.
What's next for the Cottonwood school isn't clear.
A foreclosure action starts a legal process that can lead to the loss of a property, under Colorado law. But a foreclosure filing isn't the final word. State law allows property owners time to attempt to work out a deal with lenders or catch up on missed payments.
Also, retailers, businesses and others that occupy a building that's fallen into foreclosure usually continue to operate normally while the foreclosure action plays out behind the scenes.
The Cottonwood Artists' School was founded in 1997 as a home for community artists and has more than 90 artists using its studios, according to the organization's web site.
The organization operated at four other locations before moving its offices and operations to the Colorado Avenue building in 2008.
Cottonwood also has a gallery, at 214 1/2 N. Tejon St. in downtown, that operates as a retail location for the Cottonwood Center for the Arts.
Contact Rich Laden: 636-0228
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