The discovery of asbestos has halted plans to demolish the former Club Med and prompted squatters to move back in after being evicted by the Government.

Meanwhile nothing has been said since May about the investment firm, Bazarian International, behind the redevelopment of the former hotel.

The Club Med saga began in March when Sen. Gina Spence Farmer admonished the Government for allowing people to live in the abandoned hotel.

She said people had been living there for several months because they could not afford Bermuda's high rents, despite having a job.

Housing Minster Sen. David Burch responded by saying she should be arrested for assisting the squatters.

Within weeks Sen. Burch announced that the squatters would be evicted and moved to the former Wyndham Resort in Southampton and the Club Med staff accommodation would be demolished.

However the eviction was delayed by a month because of issues at the Wyndham facility.

In early May squatters were finally moved, though many said they were unhappy about it. Demolition of the building was scheduled to happen "immediately", according to the Ministry of Works and Engineering.

But the discovery of asbestos has pushed back the demolition by months.

Yesterday Permanent Secretary of Works and Engineering, Dr. Derrick Binns, said: "An assessment was conducted on the former Club Med staff quarters and asbestos was found. Based on the findings of the assessment a plan is being prepared for its abatement.

"We have not as yet set a new date for the physical demolition of the former staff quarters."

Meanwhile St. George's residents are fed up.

Several residents spoke up at the Town Hall meeting saying they were angry to see the squatters back, suggesting that they could be behind several break-ins and thefts in the area. Some of the residents added that the buildings were unfit for people.

St. George's Mayor Mariea Caisey said: "The people who are taking up residence there, again, is of course a problem to our town.

"People are complaining because the conditions are not healthy and they are not safe. I understand there is garbage everywhere and faeces. People should not be living there because it is condemned. Hopefully Government will see fit to take it down as soon as possible."

The demolition date is not the only question mark hanging over the St. George's property.

Nothing more has been said about Bazarian International, an investment banking firm behind the scheme to redevelop the property, since May.

Premier Ewart Brown announced their involvement in April and vowed that the property will become the future home of a new high-end hotel, believed to be operated by the St. Regis group.

And developer Carl Bazarian of Bazarian International has said publicly that he plans to transform the deteriorated space into a luxury tourist spot.

In May, Dr. Brown pledged at a PLP rally that construction on the new luxury hotel would begin this year.

Since then nothing has been said on the matter.

In recent years, a succession of developers have been lined up for schemes at Club Med, which closed in 1988.

Proposals for a $210 million five-star hotel with piazza-style colony housing fell through two years ago, while plans for a five to seven star hotel with a Nick Faldo signature 18-hole golf-course were scrapped last November.