Negotiations to buy Purple Hotel site to continue
by KEVIN GROSS
The Lincolnwood Village Board of Trustees at its March 6 meeting approved an ordinance allowing negotiations to purchase the former Purple Hotel site at 4500-4560 W. Touhy Ave. and 7350 N. Lincoln Ave., from its current owner, with the possibility of acquiring the property through condemnation or eminent domain should negotiations fail.
"We have a situation where a property has been vacant for 12 years. Our actions tonight are not precluding any existing individuals from continuing, and are welcome to present whatever they need to do, and we’ll work diligently with them," Mayor Barry Bass said. "What we’re doing is taking a proactive stance on behalf of the village that’s practical and logical. It’s been 12 years."
Attorney Timothy Patenode, representing current site owner Romspen Holdings, questioned the actions of the board, and said that it would be better to stick with ZS Development, which has shown interest in purchasing and developing the site. He said that the company differs from previous developer North Capital Group that foreclosed and transferred the property to Romspen after a court order.
"Romspen Club Holdings is subject to a binding contract at this time, on which the purchaser has gone hard on its deposit. I ask rhetorically, how can we entertain properly an offer from the village if we’re under a binding contract to another purchaser?" Patenode said.
"From our vantage it appears the village is not in a position to move faster on the development of this project than (ZS Development) … As far as we understand, the village has not selected a developer, the village has not developed an RFP (request for proposals) in order to select a developer. The village has not drafted a development agreement. The village has not drafted a public-private partnership agreement," Patenode said.
Village manager Timothy Wiberg said many of those measures are not usually pursued until after property is acquired.
Wiberg said that ZS Development could still be chosen as the final developer among numerous solicited bids, and that the possibility remains that the village could allow ZS Development’s financial arm Lake Forest Real Estate Capital to go through with its original purchase agreement with Romspen.
ZS Development chief executive officer Mike Sieman restated his interest to develop the property quickly, saying that construction costs are rising at about 1.7 percent per year.
"There are market forces to be considered that would want us all to expedite. We believe we are that party to expedite," Sieman said. "I’ve been involved and have seen other condemnation actions, if it were to get to that point, drag out a long time. You’re not talking necessarily a matter of months, it could be years."
Wiberg said that village staff had been brainstorming various options to finance the purchase of the property but he would not divulge options as they were discussed in closed board sessions.
Some residents at the meeting were concerned that the land acquisition could be costly to taxpayers.
"I think with the recent changes and developments that have happened, the village is putting the cart before the horse," resident and former trustee Craig Klatzco said. "I’m very concerned that to take on any kind of burden like this is going to put a large tax burden on our residents and businesses in town."
"I think it’s presumptuous for us to take on a multi-million dollar debt in condemning the Purple Hotel," resident Pam Lefkowitz said.
Resident Teo Scorte said he supported the village’s actions.
"We forget that every single year that property is vacant, millions of dollars that could have been reinvested into our community have been lost. We need to not be an ostrich with our head in the sand and realize there’s a need to do something," he said. "I was at the 2018 Wintrust Economic Forum for Commercial Real Estate, and the projections aren’t as rosy. There are four rate increases that are supposed to happen. Values are supposed to go down. The idea that all of a sudden development is going to be easier in 2018 and 2019 isn’t really 100 percent accurate."
