THERE WAS an odd vibe last weekend at Capitol Hill's beloved Cadillac Grill--frenetic and somber, with undercurrents of panic, anger, and resignation. Though no sign was posted to inform customers of the restaurant's imminent closure, word of mouth had spread quickly. "Just because they make more money in booze than they do in food--such a sign of the times," complained one patron. The employees continued with their usual no-bullshit professionalism. "We've got some corn chowder that's been around for a while--it's pretty nasty," a waiter offered a customer.

The restaurant's closure came as a rude shock to most of the staff. At a meeting on Monday, January 8, management told workers that in less than a week, the Cadillac Grill would "close for remodeling for an indefinite period," and all but a few of the restaurant employees would be laid off. The two adjoining bars--the Verandah Room and C.C. Attle's--will remain in business, and presumably will take over the diner space. Though general manager Mark Engelman refused to answer my questions, his few words were revealing: "Quite frankly," he told me, "I'm surprised anybody's interested."

People are interested, however, and customers and employees alike share an intense sense of loss. Two days after the meeting, a note was taped next to the telephone: "If [any] media... call or ask to find out 'the scoop' about the Grill, the answer is, 'I must refer you to a manager or the owner--neither are available. Sorry!'"

"They can suck my dick," responds transsexual cook Lee Salin, reflecting the sentiment of most of the staff. "They gave us a fucking week." She is most saddened, however, by the loss of community. "Where are the transgendered people gonna go? There's no place for us anymore." A regular customer known as "Cate the Great" concurs: "It's like the end of an era. I'm just heartbroken."

Management claims the bar makes more money than the restaurant, which puzzles employees. "They're always talking about the costs, but business has really waned in the main bar," says waiter Marcus Wilson. Indeed, with the relaxation of state liquor laws, a number of former Capitol Hill taverns now have full liquor licenses, and the gay bar scene is much more competitive.

Nearly all the employees I spoke to attributed the Cadillac Grill's downfall to bad management. Staff members recite a long list of blunders: a poorly designed menu "written under the influence of alcohol," a broken-down oven, the move toward costly yet tasteless pre-made ingredients, the failure to maintain basic items like lettuce and French fries, and inadequate staffing.

Despite the Cadillac Grill's shortcomings, I always found the place oddly comforting. Around 2:00 a.m., as the bars closed, the restaurant would fill with an eclectic mix of people: drag queens, hipsters, leather fans, speed freaks, transients, and lovers in the midst of boisterous quarrels. The clientele covered a wide range of age, race, sexual preference, and fashion sense. Drunken customers would stagger out to their taxis, followed by a waiter or cook who silently mimicked the inebriate's antics for everyone's amusement. I once was narrowly missed by a mustard bottle heaved by a vicious drunk who had just been tossed out of the bar, glass and bright yellow liquid spraying across the floor.

With its pastel neon light tubes, red vinyl upholstery, and black-and-white checkered floor, the Grill was an unpretentious place. Good old-fashioned comfort food--slightly skewed--reigned here: the BLT, the S&M omelet ("these eggs get really whipped!"), biscuits and gravy, beef or veggie burgers. Management seemed out of touch with customers' preferences, however, and there had been several wildly unpopular moves to "upscale" the menu by dropping favorite items like pot roast and chili.

Clearly, the demise of late-night diners like the Cadillac Grill is yet another sign of Seattle's gentrification, and Capitol Hill denizens are particularly feeling the pinch. "Where else are you gonna go?" asks waitress Rachel Rudnick. "Minnie's? IHOP? Fuck that. I'll go hungry."

In the last hours of closing night, amid a bittersweet proliferation of goodbye hugs and kisses, the mood at the Cadillac Grill was strangely buoyant. Yet I had the sense that I was attending a wake--a memorial for an entire neighborhood. Looking at all the familiar faces of the customers and staff, I felt like I was being kicked out of my hometown.