September 11, 2007

J.W. (BILL) Marriott, Jr. is chairman and chief executive officer of Marriott International, Inc., one of the world's largest hotel companies. Bill Marriott was born into the business founded by his father. His leadership of Marriott spans more than 50 years and during that time he has taken Marriott from a small family motel and restaurant business to a global company with more than 2,800 properties in 68 countries. Bill Marriott once famously said that if he had to live his life over again he would do everything exactly the same - except open a hotel in Bermuda.

I know ACE Ltd.'s Brian Duperreault (photo), the silent but clearly indispensible partner in the Southlands Resort project, is nominally a Bermudian.

But I don't believe Brian was living here when Marriott attempted to resusicate the old Castle Harbour property some 20 years ago.

They pumped millions of dollars into the hotel, restored it to its former glory, attracted quite a large number of guests - and lost their shirt.

The high costs of doing business in Bermuda made it impossible for a group as experienced as Marriott to make a go of a major resort property here.

Nothing's changed since Marriott pulled out - except that the cost of doing business in Bermuda is more exhorbitant than ever for those in the hospitality industry.

Now, Brian, you're an insurance salesman - one helluva good insurance salesman, based on your track record, but an insurance salesman nonetheless.

Your experience of hotels, I would imagine, boils down to having stayed in quite a number of them during the course of your career. Maybe you even insured some.

But the fact is while I may want to buy an insurance premium off you one day, I don't want an amateur tearing up one of the last sizeable greenbelt areas in Bermuda to play at being a hotelier during his dotage. And that, in a nutshell, is exactly what you propose to do.

You're an actuary, Brian. Have you even done a basic cost/benefit analysis for Southlands? Do you really expect the Southlands Resort to be profitable? Do you really expect it will still be in business (as a hotel) in five or ten years?

So what do you know that someone as experienced as Bill Marriott didn't? Do tell. I'm all ears.

NUMBER CRUNCHER