I Tires are rubbing against the wheel hub. Is there a way to raise my 1997 328i BMW ?

Not really... you might be able to swap out the springs with a BMW X5 or X3 to add some lift but no one really wants to "raise" their cars now a days! What I would do in your case is have the fenders rolled and pulled by a professional. Check out this place in Maryland http://www.iagperformance.com/fender_rolling_service.html I'm sure you can find a company in your area as well. I hope this helps.

Here's another photo of the process.