The recent sale of its mortgage notes may very well be the Purple Hotel’s saving grace.
Jake Weiss of Skokie-based Weiss Properties partnered with North Capital Group to acquire the notes from First Midwest Bank at the tail-end of December.
If all goes according to Weiss’ plan, the Purple Hotel will reopen as a mixed-use property with a boutique hotel, large convention center, and retail space.
Yet Weiss must first convince Lincolnwood officials preserve the popular building with a colorful past that over the years had become a community eyesore.
A Cook County judge granted the village permission in August to tear down the building at the property owner’s expense due to 31 building code violations, including mold, insect and rodent infestations and asbestos hazards.
The Lincolnwood Board of Trustees awarded a $1.187-million contract to Delta Demolition Inc. of Chicago for the hotel’s demolition Dec. 20.
“By taking the vote it seems the board is serious about taking the building down,” said Village Manager Tim Wieberg. “The village’s standpoint is there’s not a more important development site than that one.”
Weiss hopes his presentation last month to the Committee of the Whole and purchase of the mortgage notes might have given officials pause.
The board has yet to give Delta Demolition notice to proceed, said Wieberg.
Weiss said he will now work with village attorney Steve Elrod to remove the property from bankruptcy and into foreclosure proceedings, a process that could take six to nine months.
He said his company’s plans for the 5.28-acre site at the corner of Lincoln and Touhy Avenues are a “nod to the past.”
“There’s so much history you can’t replace even were you to rebuild,” he said.
He said the website, www.savethepurple.com, demonstrates the community has a vested interested in preserving the Lincolnwood landmark.
Though most of the hotel will have to be gutted, Weiss said its concrete structure is “in very good shape.”
Preserving the building is both a fiscally and environmentally sound strategy, he said, as he estimates demolishing and rebuilding the hotel would add $15-20 million to the project.
Weiss said his company is experienced in revamping once-vacant properties.
In the last four years Weiss Properties put 600,000 square feet of vacant land “back in use,” he said.
“I empathize with the village’s position for having to sit with the blighted property,” Weiss said. “But we’re ready to come in with somewhere in the range of $20 million to revitalize the hotel and make it something special.”
Riverwoods-based brokerage firm Podolsky Northstar CORFAC International negotiated the sale at an undisclosed price.
Managing principal Randy Podolsky said the outstanding debt was $4.5 million.
Take a Tour Inside the Infamous Purple Hotel
Take a look at some of the galleries we found on the web with pictures of the Purple Hotel in its current state.