A new era is set to transform the Wyndham Hotel into a five or possibly six-star resort with the backing of one of the largest financial lenders in the hospitality industry.

Staff returning to work at the South Shore resort this morning, following a near three-month lay-off, will be told news that the hotel is now under the control of new owners intent on turning it into a top-of-the-market resort with a world class leisure facility and a totally rebuilt Carlton Wing.

Uncertainty fell on the hotel in January when it suddenly closed its doors with management giving only a few days notice to staff, many of whom had to seek other work or face hardship, until the re-opening on April 1. They were told to report back to work today in order to have the hotel up and running in time for the first guests of the new season. But events have now taken an extra upward twist with the official announcement that Windwalker Bermuda LLC, an ownership consortium financed by Lehman Brothers, has acquired a controlling stake in the company that owns the hotel resort and spa.

In a statement the new ownership team said it intended to turn the hotel into "a premier resort destination featuring a luxury hotel, world class field and recreation club and a hospitality-orientated residential development".

The vision for the 32-acre property includes a condo-hotel and fractional accommodations, extensive renovations to the Bay Wing, a rebuilt Carlton Wing and recreational and social club to be called The Southampton Club offering tennis, squash, exercise facilities, pool and beach access, spa and fine dining open to hotel guests and Island residents. Speaking to The Royal Gazette, Windwalker managing director Alan Worden said: "Bermuda is a fabulous place to visit and we have purchased one of the best sites on the Island. We have the ability to make it a five or six star hotel.

"We hope to add a variety of products to entice visitors; a new hotel, world class spa and new dining facilities.

"It will require the hotel to close for a period of time but right now we are concentrating on reopening the hotel this season. We are not sure when the hotel will close for development."

He said: "Today will be a great day for the hotel and I am sad I will not be there. We are delighted to invite back all the people who have worked at that facility for a number of years. It is important we open the hotel and get those people back to work and doing what they are good at doing."

Mr. Worden said he had met with the Bermuda Industrial Union and hopes to work closely with it to ensure any concerns are dealt with. He said there would be a long-term commitment to Bermuda.

"The fact that Lehman Brothers is involved is quite significant. Lehman Brothers is one of the largest lenders to the hospitality industry in the world and invest nearly $3 billion into hospitality every year.

"They, along with my colleagues, have made a commitment to getting the hotel back open and we have a very long term view of this asset. It is one of the greatest pieces of real estate that I have ever seen.

"Ultimately there is some complexities to this site and we encourage Bermuda to be partners with us and the union to be partners with us. We intend to work closely with community and ultimately be an integral part of the Island."

The new hotel manager is Larry Magor who has over 25 years experience in the tourism and hospitality industry and has held senior management positions at the Breakers in Palm Beach, the Ritz Carlton in Chicago and the Grosvenor House Hotel in London.

Mr. Worden said: "I think Bermuda has so many positives. It is known throughout the world for the hospitality of its workers and that's certainly been my experience over the past year.

"Bermuda is a great place, my wife came here 35 years ago and still has a photo of all the waiting staff she met while she was here. She has fond memories of the hospitality. We want to make it a place that our children will want to come back to for decades."

He added: "The Government has a strong commitment to tourism and that is critical. I have met Tourism Minister Dr. Brown a number of times and he is an incredible asset to the Island. I had the chance to meet the Premier and we felt his endorsement was a positive thing. I also had a chance to speak with the Cabinet last week. The Government is doing a great job in encouraging capital investment in tourism.

"Bermuda is also a very short flight from the Boston/Washington corridor. That market is wealthy, sophisticated and security conscious. We think Bermuda needs a product that will attract that market, and that product is a five or six star hotel."

Masood Bhatti, vice-president of Lehman Brothers, said the support of the Government to tourism in Bermuda was fundamental to the success of the project and said the increased air flights to the Island were an important factor in the decision to make the investment in the hotel.

Deputy Premier and Tourism Minister Ewart Brown said: "We are very excited that this prestigious team has made such a significant investment in Bermuda. The project will have a considerable impact on the local economy, creating jobs for Bermudians in both the completion and operating stages of the development.

"This is another milestone for tourism in Bermuda."