Point, it was announced yesterday.

However another bid to develop Daniel's Head was thrown out -- leaving its immediate future in doubt.

Yesterday the Bermuda Land Development Company -- which is charged with overseeing development of the former bases -- said the shortlist for Morgan's Point had been narrowed from five to just two groups.

It is expected the winner will be revealed early next year and multi-million dollar work on the Annex will begin by Autumn 1997.

Only one bid was received for Daniel's Head, but company chairman Vincent Ingham said it did not meet the criteria laid down for the area and was rejected.

"In addition to a spa, the developer was proposing to have a very heavy concentration of housing on the site,'' said Mr. Ingham.

He said he did not believe demonstrations by the Sandys Action Group, which wants to preserve open space at the site for the community, had played a part in turning potential developers away.

And Mr. Ingham said the Company would now review the future of Daniel's Head with different groups and committees taking part in the review.

Mr. Ingham added: "I would like to reiterate that any decisions we make on the future of Daniel's Head will be governed by two main considerations; the extent to which proposals meet our business strategy and their conformity with the Bases Development Plan.'' The two groups left to battle it out for Morgan's Point are BEAM -- a Bermuda company formed specifically for the development -- and the Morgan's Harbour Investment Partnership headed by UK-based Renaissance Resorts International Corporation.

Bermudians involved in the Partnership are Edward Lawrence, Arthur Morris, James Pearman and Robert Tucker while construction company owner Alan Burland is president of BEAM.

Although no details are being released about their developments, they both involve hotel, residential, a championship golf course, marina, commercial and public park developments.

Both teams, which will be responsible for environmental clean-ups if successful, are made up of Bermuda investors and international experts in all the various development fields.

They were chosen after a rigorous selection process which examined the scheme, financial backing and experience.

Now they will undergo further scrutiny by the company and the successful bid will be examined by the public during an "open house'' in the New Year.

Mr. Ingham added: "The substantial amount of local participation in the development teams shows that the entrepreneurial spirit is alive and well in Bermuda.''