Skokie hopes clearing up litigation will convince new developer for abandoned downtown hotel

The Village of Skokie has secured “firm commitments” from all the lien holders of an unfinished downtown hotel that they are willing to discount or walk away from their claims to see construction at the site resume, according to an attorney working with the village. 

Rodney Lewis, an attorney with Skokie’s outside legal counsel, shared that update with the Village Board on Monday in the latest report on the status and future of the property that has stood in limbo at 4930 Oakton St. ever since its construction halted in 2023. 

Rodney Tonelli, Skokie’s economic vitality manager, added that the village is continuing to have “active conversations” with at least seven developers interested in taking over the shell of the hotel, which a structural engineer determined last fall was in “OK” condition.

“The ‘hold up,’ if you will, is just finding a developer who feels that the math works for them,” Lewis said. “The real answer is, it’s a bit of a numbers game.”

As previously reported, construction of what was supposed to be a Homewood Suites by Hilton hotel halted in 2023 after the general contractor, Russell Construction, sued the project’s owner and developer, E&M Strategic Development, for allegedly failing to pay a $10.7 million tab.

Russell Construction’s lawsuit was reportedly consolidated last year with another complaint from X-Caliber Capital, E&M’s lender, whom the developer apparently owes about $9.7 million.

An arbitration panel reportedly ruled in October 2025 that Russell has priority over any profit derived from an eventual sale or development of the hotel property, but the panel isn’t scheduled to meet again until September to begin resolving other outstanding claims between the parties. 

On Monday, Lewis said village staff and attorneys have helped the project’s lien holders realize that “there’s really not a benefit to continue on in the litigation” as their claims, even if resolved, are unlikely to result in any money if the property continues to sit unfinished.

So the village has continued to work as an intermediary between the lien holders and the developers by securing those commitments to discount or dismiss those claims, Lewis said. 

The village reportedly has also organized site visits for potential developers to examine the structure, and village staff are meeting with the involved lenders this week so that the developers know how much it will cost to eradicate the open complaints and complete construction. 

“When I was before you last, with the momentum we had, we thought it might be more imminent,” Lewis said after Mayor Ann Tennes asked about the likelihood a developer might reach an agreement to take over the property before arbitration proceedings resume this fall.

“So the fact is that we’ve got people at the table and so it takes just one.”

Of the 13 developers village staff contacted about potentially taking over the property, Tonelli said two developers declined, a “few” are “parked in the middle,” and the rest are actively in process of determining if they’d like to take over the hotel.

A couple of the developers potentially interested in taking over the hotel are also “looking” at taking over the adjoining site at 4900 Oakton St., Tonelli said. 

If a deal isn’t made for a developer to take over the property by this winter, Tonelli said a structural engineer will complete another analysis of the property this upcoming fall.

“We’re all frustrated by this project. It’s an eyesore in the middle of our community. It’s a project that this board largely inherited,” Tennis said. “(I’m) really grateful to staff for understanding our collective interest in making a resolution of this matter a priority for the community.”

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