Radisson’s Last Freeway Message: ‘Hotel Closed’ : Business: Bank forecloses after owners default on $6.4 million in loans. The facility had 130 workers.

Despite the pleas of workers, the Radisson Hotel City of Commerce closed its doors last week after the hotel’s owners defaulted on $6.4 million in loans.

The hotel marquee, notable for the clever messages it offered Santa Ana Freeway motorists each day, simply read “Hotel Closed.”

Sumitomo Bank of California foreclosed on the hotel last month, county property records show. A court-appointed receiver, Investors Property Services of Santa Ana, took over the facility Oct. 26. After examining financial records, the receiver declared the hotel insolvent and shut it down Nov. 1.

The 283-room Radisson, on the site of a former Hyatt Hotel at 6300 E. Telegraph Road, employed 130 workers and was the only unionized hotel in the City of Commerce. Hotel employees had been working without a contract for more than a year and had hoped to negotiate with a new owner.

When employees arrived at work Nov. 1, they were told to return home, and hotel guests were asked to leave.

Robert C. Warren, vice president of Investors Property Services, wrote in a letter to employees that “unanticipated and acute financial circumstances . . . compounded by lack of cash” made it impossible for hotel operations to continue.

Among the debts are “nearly half a million dollars in previously undisclosed payables and related financial obligations,” according to the letter.

Members of the Hotel Employees and Restaurant Employees Union, Local 11, said they knew the hotel was in financial straits. About 60 housekeepers, busboys, waiters and cooks rallied outside the hotel on Oct. 29, hoping to persuade Warren to keep it open.

“All of us who work here work very hard, and we want to work,” said Marta Silva, 40, a hotel housekeeper. “We’ve given up a lot lately with the idea that we want to keep this hotel open.”

Union members and representatives of LCF Commerce Hotel, the partnership that owned the Radisson, were involved in a protracted labor dispute. The National Labor Relations Board has scheduled a March hearing on a complaint that the hotel illegally cut workers’ wages and benefits, said Ellen Greenstone, union counsel.

Greenstone termed the hotel’s closure a “disaster” for workers and said it may be in violation of a federal law that requires businesses to give employees 60 days’ notice of closure or 60 days’ pay. In addition, workers are still owed one week’s wages and pay for accrued vacation, she said.

Gerald R. Whitt, an attorney for LCF Commerce Hotel, said his client had turned over cash to the receiver that “we thought was going to pay for those (back) wages.”

Warren would not comment on the details of the hotel closure.

Unlike recent efforts by city officials to keep companies such as A T & T from closing offices here, the city did not become involved in the struggle to keep the hotel open. Justin McCarthy, deputy director of the city’s Community Development Commission, said Commerce officials opted not to intervene because of a downturn in the hotel business and over-investment in hotel properties along the Santa Ana Freeway.

“There’s a restructuring and revaluing going on in the hotel industry, just like you’re seeing in commercial and office real estate,” McCarthy said.