Lake and Forest hotel project in Oak Park hits snag

20-story hotel tower may be switched to apartments, senior housing

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By Marty Stempniak

Staff Reporter

A 20-story hotel and condo tower envisioned for downtown Oak Park may end up being neither, according to a village official.

Village hall and a Chicago-based developer have been working for years to reinvent the northeast corner of Lake and Forest. Sertus Capital Partners owns the corner lot there, and the village owns an aging public garage.

Those talks culminated last year when the village board approved a glass tower, which would include a new public garage at the bottom. Oak Park said it would kick in almost $10 million for parking, along with a $500,000 incentive to get Sertus to build a hotel.

But the project has been mired in delays because of the slow economy and struggling hotel and condo markets. The developer needs to apply for building permits by December, a year behind the original schedule. Now it appears things might be delayed further.

Wednesday Journal has learned that Sertus approached the village earlier this month with the possibility of swapping out both the hotel and the condo portions of the development, while keeping the two-story retail space at the bottom.

Village Planner Craig Failor told the Oak Park Plan Commission last week that it may need to start discussing the project again in the future because of a change in use.

"Obviously the condo market isn't doing well," Failor told Wednesday Journal Monday night. "So just based on the market realities, they saw there needed to be a change in their programming."

Sertus is considering the possibility of age-restricted housing in the building, for seniors over the age of 55, along with some high-end apartments. Failor said the talks are preliminary, and the possibility still exists that the hotel or condos could materialize.

The developer hasn't submitted any formal proposed changes to the project, and Failor was unsure when they might. At the latest, they have until Dec. 15, when Sertus needs to apply for building permits. Failor also expects the developer to apply for another extension.

"If they reprogram everything, they probably won't be ready for December," Failor said.

Michael Glazier, principal of Sertus, declined to comment when reached Friday. He spoke candidly about the challenges the project faces during a public meeting in March.

"The economy is still an issue — particularly for housing hotels, it's difficult," Glazier told trustees in March. "I will say, however, there's a bit of a thaw now in terms of there being investor interest."

Village President David Pope, who has been a vocal proponent of the project, declined to comment Monday night until he first spoke with Glazier. Pope could not be reached for comment Tuesday morning.

Reader Comments

17 Comments - Add Your Comment

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john murtagh from oak park  

Posted: May 28th, 2011 3:49 PM

My limited knowledge tells me that Sertus' forecast was too high. That happens a lot as developers add capacity to drive higher revenue. It is not unusual, but is costly, for a developer to have to downsize a proposal. Do they have financial room to do so? I think the senior thing is strange. Baby boomers reached 65 this year. That gives you 20 years of potential demand, but the baby bust followed the boom. What then? Condo glut probably caused the senior option. Did OP have a demand f/c?

john murtagh from oak park  

Posted: May 28th, 2011 3:34 PM

OP Res - Jim, I think it is difficult to attract major retailers to Oak Park since customers seem to prefer the mall environment with multiple store choices --big and small. OP does not have enough space. Not having major shopping and large corporations makes it difficult to attract the numbers of people required to have a large hotel, though I do think a smaller, modern hotel complimented by retail could be appealing to customers but not necessarily investors.

OP Resident  

Posted: May 27th, 2011 8:32 PM

Sertus Capital Partners LLC are successful developers and well respected in the industry. This isnt their first project. They paid dearly for the property and I'm sure they will be fine. Check out their website: www.silveryoung.com

OP Resident  

Posted: May 27th, 2011 8:27 PM

Thank You WJ for your actions against The Ghost. Back to regular programming......

Jim Coughlin  

Posted: May 27th, 2011 7:23 PM

The Village Board is going to have to reach out to the community, John. Would it be possible to attract interest from a major retailer?

john murtagh from oak park   

Posted: May 27th, 2011 5:09 PM

Jim, there are a lot of clever people in Oak Park and at Village Hall. Unfortunately none of them seem to have any experience in risk assessment. The risks were huge on this project and the risk discussion was minute at best.

O..........P  

Posted: May 26th, 2011 8:56 PM

How about a 20 story YMCA with deluxe SRO's?

Jim Coughlin  

Posted: May 26th, 2011 3:50 PM

"I told you so!" is the last thing we need to hear. Oak Park has a lot riding on making this work. What are our options if the hotel/condo plan cannot get financing? I'm not going to point fingers or sit on my hands. There are lot of creative people in this Village who have vision and expertise. Tap in to their energy.

john murtagh from oak park  

Posted: May 26th, 2011 2:27 PM

MONDAY - Board approves public housing proposal. TUESDAY - Sertus housing implodes. WEDNESDAY - News of our significant lower housing appraisal arrives. THURSDAY - Apocalypse rescheduled?

Decimus  

Posted: May 25th, 2011 5:18 PM

Gee, David, cat got your tongue? At this rate your dance card of failures will be full by April, 2013.

Bob from Oak Park  

Posted: May 25th, 2011 5:15 PM

I agree with O.....P. If one affordable housing complex on Madison Street is good for Oak Park, imagine how great a larger one at Lake & Forest would be!

Ess  

Posted: May 25th, 2011 10:57 AM

Hey...why don't they put something we could all use there, like a little grocery store and a diner. Oh...wait...they tore that down. I keep forgetting that Oak Park doesn't care what the villagers here like, need and want.

O...........P  

Posted: May 25th, 2011 10:23 AM

Perfect place to put supportive housing for felons making $26,000 per year! Oh wait, we only do that for the Madison business district. Sorry.....

Cdonovan  

Posted: May 25th, 2011 7:35 AM

As I recall this project started out as just a hotel with parking for the guests and the public. Somehow someway condos got added and the proposed project got taller; just as the housing market was tanking. All the while Oak Park lost another popular family restaurant and a grocery store. One delay could lead to another and eventually this development could go the way of Los Casadores. Then what, more sushi?

Alan Reed from Oak Park, Illinois  

Posted: May 25th, 2011 6:41 AM

Given current economic realities, this had a nearly zero chance of ever being a hotel/condo building. At least a discussion of what can legitimately be put in that space will now begin.

john murtagh from oak park  

Posted: May 25th, 2011 12:20 AM

How ironic that the announcement of the Sertus deal was delayed until the board approved the Madison Housing Development. Must be a coincidence that Interfaith, OPHA, and the board were pumping up the idea of seniors living in the Mad House on Monday and moving them to Forest and Lake on Tuesday. How many rooms will be set aside for the handicapped at the high rise? When does the board new transparency begin or is that still under study?

Jim Coughlin  

Posted: May 24th, 2011 11:35 PM

David Pope called the project a "Win-Win" for Oak Park. The Village is going to have to see the plans or a new proposal months before the December deadline.

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