Decrepit Purple Hotel in Lincolnwood overstays its welcome
DAVID ROEDER firstname.lastname@example.org August 16, 2011 6:16PM
David Roeder reports on real estate at 6:22 p.m. Thursdays on Newsradio 780 and 105.9 FM WBBM. The reports are repeated at 10:22 p.m. Thursday and 7:22 a.m. Sunday.
Updated: November 16, 2011 1:29AM
It’s mid-August and the former Purple Hotel, 4500 W. Touhy in Lincolnwood, is still standing. That’s noteworthy because as of Aug. 1, the village of Lincolnwood has had the legal right to tear it down and put a lien on the property for its trouble.
The Purple Hotel started out life in the 1960s as a Hyatt, a classy place to stay and to hear performers such as Perry Como or Roberta Flack.
It slid down the demographic scale until it went independent, being unable or unwilling to meet the standards of any hotel franchise, and became known for hosting sex clubs. It closed in 2007.
The place has so many code violations that in February the village got the legal right to raze it unless owner Donald Bae made repairs. None has occurred, said village Administrator Timothy Wiberg, so the town is preparing specifications for demolition bids.
But that’s probably not Bae’s biggest concern. His lender, First Midwest Bank, wants to foreclose on him and is trying to sell the unpaid mortgage note. The buyer then could be in position to take control of the site, which Lincolnwood officials want redeveloped.
Podolsky Northstar Corfac International is the agent for the note sale. Senior Vice President Adam Tarantur said he hopes a winning bidder will be selected by the end of the month. He said Bae owes $4.6 million, counting penalties.
Bae is a Korean business leader whose conduct in this matter has been strange. He has listed the property for sale with a $25.8 million price, a figure that real estate experts say is so high that it deters serious inquiries. Rather than sell it for whatever he can get, Bae now risks losing the property altogether. He could not be reached for comment.
Wiberg said he’s been told tearing down the 293-room hotel may cost about $1 million.
He noted that the village has created a tax-increment financing district that includes the property, so it has a funding source to pursue its vision of a pedestrian-friendly “town center” anchored by stores and new multifamily residences.
All of that may take years to come together. But for Bae and his hotel, named for the color of its bricks, the clock says it’s check-out time.
COOKIE JAR: The Maurice Lenell Cooky Co. factory and store at 4474 N. Harlem in Norridge closed in late 2008, and the real estate slump has deterred any redevelopment. But a firm based in Columbus, Ohio, Glimcher Realty Trust, has expressed interest in the site, said Norridge President Ronald Oppedisano.
Glimcher executives did not return calls. The Lenell site is owned by a Connecticut investment manager, Commonfund, that paid $11.5 million for it in 2008.
Oppedisano said he has seen no specific plans from Glimcher. One retail broker said Glimcher wants to assemble several parcels and is aiming, perhaps grandly, to sign Macy’s or Von Maur as anchors.
SOUTH SIDE PROJECT: Mayor Rahm Emanuel is backing the sale of 2.65 vacant acres at 9705 S. Cottage Grove so the Social Security Administration can get a new $4.8 million building.
The city would sell its land to an entity controlled by Lake Forest developer William Schorsch, who specializes in federal government deals, for $465,000. The developer can use the price to offset the cost of environmental remediation.
The Social Security Administration would sign a 10-year lease and move about 35 workers to the new location.
CALENDAR NOTES: It’s still August, but three events scheduled for when the days will feel shorter beckon anyone with an interest in real estate:
NAIOP Chicago hosts a high-powered panel Sept. 20 to discuss the “real story” of the Chicago office market. The event includes breakfast and will be held at Riverway Auditorium, 6133 N. River Road in Rosemont. Sign up at naiopchicago.org.
The investment outlook for suburban property is the topic at a Sept. 22 breakfast called “Defending the ’Burbs.” I guess someone has to. It’s planned at the Union League Club of Chicago and the sponsor is the Chicago chapter of the Urban Land Institute. See Chicago.uli.org.
And the Chicago Association of Realtors will induct commercial property legends G. Joseph Cosenza and Goldie Wolfe Miller into its hall of fame Oct. 5 at Navy Pier. See Chicagorealtor.com.
DOING THE DEALS: Southern Prosthetic Supplies Inc. leased 44,600 square feet for a new Midwestern distribution center at 386 Internationale Drive, Bolingbrook. UGL Ltd. was its broker. . . . Principle Construction Corp. broke ground on a 267,000-square-foot building for Winpak Portion Packaging Inc. at Mark Collins Drive and LogistiCenter Drive in Sauk Village.