operating its St. George's hotel and wishes to accelerate the handover of its lease.

And Minister of Tourism David Dodwell said yesterday that Government has two potentially serious suitors waiting in the wings to step in and take over the East End property.

The move appears to be tied to recent major shake-ups at Club Med's European headquarters, said Mr. Dodwell, and is good news for Bermuda in general and St. George's in particular.

"This has come a lot quicker than we'd expected, frankly. And now we have a unique opportunity to be able to help with the return of the facility to the people of Bermuda,'' he said.

"I want to make the point that I don't believe Government should be in the business of operating hotels, but should act as a facilitator.'' Up until a couple of weeks ago, said the Minister, it appeared likely the Club Med saga would drag on for years; the company and Government -- which owns the land -- are presently locked in arbitration over how to discharge its lease on the property.

A "substantial'' amount of time remains on Club Med's lease, said Mr.

Dodwell, but the hotel has been out of operation since 1988 and is understood to be in need of multi-million dollar refit.

Various proposals have surfaced recently aimed at bringing the 340-room hotel back onto the market, including talk of Club Med opening with a limited number of rooms, or operating the site as a timeshare development.

But Mr. Dodwell refused to disclose what type of operation would take over Club Med's lease, nor would he identify the parties who have expressed an interest in taking it over, saying only one was a global player in the hospitality industry.

"If one of the them is accepted it means a major rebuilding, but they are happy with the core of the building,'' he said.

Agents for both have toured the site adjacent Fort Albert and overlooking Fort St. Catherine, and they are willing to invest in the necessary renovations, he said.

"Right now the discussions are serious, but we're talking broad strokes,'' he said in characterising the nature of ongoing negotiations.

Shadow Minister of Tourism David Allen agreed the news was encouraging, especially for the Town of St. George, and said the Progressive Labour Party was aware something "was percolating'' on the Club Med front.

But while the PLP has known of "a couple prospective developers'', he refused to identify them. "Some of the discussions have been very much low key and off the record,'' said Mr. Allen.