ALAMOSA, Colo. — The San Luis & Rio Grande Railroad, a 154-mile short line operating a former Denver & Rio Grande Western route in Southern Colorado, is about to be sold by auction as part of the ongoing bankruptcy sale of former Iowa Pacific Holdings properties.
Bankruptcy Trustee William A. Brandt Jr. has announced his intention to sell “substantially all of the assets” of the railroad by action, subject to U.S. Bankruptcy Court approval. Interested parties will be required to submit a bid by July 10, 2022, at 4 p.m. Mountain Time.
The trustee and his court-retained financial advisors at Development Specialists, Inc., have set a minimum bid of $5.75 million, plus the assumption of all liabilities arising after the sale closing. If there are multiple qualified bids, an auction will be held July 14, 2022, at the Denver offices of Markus Williams Young & Hunsicker.
The San Luis & Rio Grande interchanges with the Union Pacific at Walsenburg, Colo., and currently provides freight service to the San Luis Valley for a variety of industrial, mineral, and agricultural customers. It offers more than 3,100 cars of storage capacity, and prior to bankruptcy operated passenger excursions over the 9,400-foot La Veta Pass. The 155-mile route dates to 1878; along with its east-west line between Walsenburg and South Fork, Colo., it includes a 20-mile branch line between Alamosa and Antonito, Colo.
The auction will cover “various pieces of real and personal property used in connection with conducting and maintaining the operations of a freight railroad,” according to a press release. These include trackage, structures, maintenance equipment, and licenses or agreements relating to railroad real estate.
Copies of the Motion to Approve Bidding Procedures and related exhibits are available upon request by contacting the trustee’s counsel, or for a fee via PACER at the bankruptcy court website. Inquiries should be directed to William G. Brandt (312-263-4141 or wgbrandt@DSIConsulting.com) or Patrick J. O’Malley (312-263-4141 or pomalley@dsiconsulting.com).
I am glad I had the opportunity to ride over La Veta pass behind steam before this operation folded. It was a neat trip, but I was apparent to me at the time it would be a tough operation to keep going. The weekend train I rode was nearly empty when I visited, which was surprising given the packed DSNG and CTS weekday trains I had seen just days prior. There did not appear to be much in the way of on line freight customers to support what is likely a difficult section of railroad to maintain.