Radisson Subcontractors Move Closer to Getting Paid

The four subcontractors who still haven't been paid for the work they did work on the Radisson Hotel may be a bit closer to getting the more than $200,000 they're owed.

A Waukesha County judge Friday approved a request from the subcontractors to put the hotel's contractor, Gil-Her Limited, into receivership.

Attorneys representing Heritage Glass, Horner Plumbing, Badger Lighting, and Ace-ICS submitted the receivership petition. The receiver will handle the day-to-day operations and finances of Gil-Her Limited, which was the contractor that hired subcontractors for the Radisson Hotel project.

The small businesses have been trying for more than a year to get paid for their work on the hotel, which opened in May 2011.

Not only could the action Circuit  Judge James Keiffer make it easier for them to get their money, but it also could allow the Village of Menomonee Falls to avoid moving forward with foreclosure proceedings on the hotel.

There will likely be very few operations to handle at Gil-Her.

One partner, David Gilbert, filed for bankruptcy just a month after the Village Board approved the $17.6 million loan for the hotel. Gilbert was also one of the five members of Falls Lodging Investors, which was the ownership group of the hotel. Gil-Her is insolvent with liabilities exceeding assets by $1 million, and its sole asset is a lien against Falls Lodging Investors.

In June, the Village of Menomonee Falls filed a foreclosure suit against Falls Lodging Investors after it failed to make any repayments on its village-backed loan loan. In November 2011, the village appointed a receivership attorney, Seth Dizard, to handle all operations at the hotel.

Both Friday’s receivership appointment petition from subcontractors, and the village’s ongoing foreclosure suit are linked.

“It’s our hope that all of the parties who have a claim against Gil-Her can reach some sort of settlement agreement, and that we can then go to the Village of Menomonee Falls,” said Horner and Heritage attorney Mark Darnieder. “We needed a mechanism to get all the people who have an interest in Gil-Her and might have a possible claim against the Radisson and that property in front of the court so we can reach a resolution.”

Contractors have hired receivership attorney Todd Esser to handle operations at Gil-Her.

The hope is that Gil-Her will submit claims from all its creditors to the court, and a resolution can be reached with the subcontractors. When that is accomplished, it would allow the village’s attorney, Randall Crocker, to get a clean title for the hotel.

If that happens, the village and Lodging Investors could reach a settlement and avoid going through the foreclosure process.

In September, Crocker said a resolution to the Radisson foreclosure suit could be forthcoming. Crocker will continue to negotiate with parties in the suit, and they will all appear before a Waukesha County Circuit Court judge Nov. 19 for a status conference.

An agreement could be reached by then.