CRE Midwest

Village of Lincolnwood wins the right to demolish Purple Hotel Building

| markt

A long court battle may come to an end soon as a Cook County circuit court judge ruled that the Village of Lincolnwood may demolish the Purple Hotel building at 4500 W Touhy Avenue if the property owner, Village Resorts Inc., does not bring the building up to code by August 1, 2011.

A long court battle may come to an end soon as a Cook County circuit court judge ruled that the Village of Lincolnwood may demolish the Purple Hotel building at 4500 W Touhy Avenue if the property owner, Village Resorts Inc., does not bring the building up to code by August 1, 2011. The demolition of the well-known property, due to its distinct purple façade, would be paid for at the owner’s expense.

The village was represented by Steven M. Elrod, a partner with Holland & Knight, in a case that dates back to March of 2010, when the village filed a complaint against the property owner, alleging that the property was in violation of 31 building and property maintenance code provisions.

The complaint asked for the building to either be brought into code compliance or to be demolished in accordance with the Illinois Demolition Act.

The court ruled in favor of the village, citing the property as “dangerous and unsafe.”

Elrod says that it is very rare for this ruling to be declared on a property of this size. It is usually used in rulings on “abandoned one-flat or two-flat properties in the City of Chicago.”

At this point, Elrod says that it would be more expensive to bring the property up to code than to demolish it.

The property has been on the market for years, after it was officially closed in 2007 because of health and building violations. Inland Real Estate Acquisitions and TMK Development agreed to purchase the property in 2008 for $27 million, but then backed out of the deal in early 2009.

Now, unless a new buyer steps forward, or, the current owner complies with court orders, the building will likely face demolition as soon as August 2. If it does come to this process, the city will bill Village Resorts Inc. for the cost of demolition. If the company does not pay, the village has the right to put a lean on the property that will supersede all other leans. The village may then decide to foreclose on the property and take control of the land.

“The ultimate goal is to have property redeveloped,” says Timothy Wiberg, village administrator for Lincolnwood. “It is a blighted property on a very prominent corner.”

Wiberg says that they village often receives complaints from residents, especially those who live in condominiums directly across the street from the Purple Hotel.

Village Resorts Inc. may receive a boost in the coming weeks as the Village of Lincolnwood is in the final stages of establishing a TIF district in the defunct hotel’s location. This could be a welcome tool to entice more potential buyers to the property.

Wiberg says that the TIF could be approved as early as February 17 and that no residents spoke against it at the village’s last public meeting.