Questioning the validity of an affordable housing plan is always going to be unpopular, but there is something not quite right about this week's announcement of plans to build 125 affordable homes on the South Shore in Warwick.

The Grand Atlantic/Golden Hind site is one of the few prime tourism sites left on the South Shore and, unlike the neighbouring Southlands estate, it is a "brownfield site" having been the home variously, of the Bermudiana Beach Club, the Golden Hind restaurant and the Banana Beach Club, all names from Bermuda's tourism past.

It was also the site of the failed Ritz Carlton resort planned in the late 1990s, which people with good memories will recall was blocked by, among others, future Progressive Labour Party Tourism Minister the late David Allen, former PLP Premier Alex Scott and current United Bermuda Party Shadow Finance Minister E.T. (Bob) Richards.

The property now belongs to a consortium represented by Bermudian businessman Larry Swenson, who has had a special development order for the property for the last few years.

What he does not appear to have now is financing for the project, no doubt because of the credit crisis.

Apparently, that's not a problem for Government, which plans to buy eight acres of the property to construct apartment buildings similar to the Loughlands development. The units will then be sold for between $500,000 and $625,000 each to local buyers.

Presumably, the money from that purchase will then be used to develop a 100-room hotel on the site.

It is strange as well that Government has revealed everything about the project except the purchase price, although realtor Buddy Rego's estimate of $24 million ($3 million an acre for prime South Shore land) sounds about right.

In today's environment, that does not go very far, even for a 100-room hotel with two restaurants and other amenities, but it might be enough to get the project off the ground or to trigger other financing.

Nonetheless, it seems a waste of one of the few prime tourism sites to use part of it for densely packed affordable housing, although it is far from the first time; at the same time that Premier and Tourism Minister Dr. Ewart Brown has been talking about a "platinum period" for tourism, the Public Safety and Housing Minister Sen. David Burch keeps buying land zoned for tourism – Loughlands, the Harmony Club and now the Golden Hind site – for housing.

The timing is also somewhat peculiar. For the first time in a decade, house prices are finally softening, along with rents. That means that the market, as Sen. Burch himself has noted in the past, is starting to ease of its own volition. Does Bermuda need another 125 homes being put on the market? To be sure, no one knows what kind of shape the economy will be in by 2011 or 2012, but it seems risky and expensive, especially when Bermuda is already facing ballooning budget deficits, to do this now. The irony of this being announced on the same day that Bermuda's debt rating was knocked down two notches is inescapable.

In many ways, this looks like a bailout, but one aimed at rescuing reputations, not the economy. Contractor Gilbert Lopes gets a construction project just as the construction industry looks set to go from boom to bust. Developer Mr. Swenson gets funding to get his moribund project moving again. Sen. Burch can take the credit for more affordable housing. And Dr. Brown can claim that a hotel project is moving forward, albeit on a much smaller scale. But his spinmasters will find a way to turn that into a positive; they always do.

The only loser, it seems, is the taxpayer, who has to fund it.