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Premier tables $25m guarantee for Bermudiana

The Bermudiana Beach resort in Warwick (File photograph by Blaire Simmons)

A multimillion-dollar government guarantee for the completion of the luxury Bermudiana Beach resort was tabled in the House of Assembly yesterday by David Burt.

The Premier and Minister of Finance told MPs that a guarantee had been issued for a $25 million loan on behalf of the Bermudiana Development Company, a subsidiary of the Bermuda Housing Corporation, for the completion of the resort on the South Shore in Warwick.

It brings the total commitment to the project to $35 million, with the finish line expected this summer.

Hilton Hotels, which branded the resort under its Tapestry Collection, states online that the Bermudiana is slated to open in November.

The hotel was converted from the former Grand Atlantic estate, built by the Government for affordable housing but unable to gain traction with the community.

Its condos were used in 2015 as temporary accommodation for sailors on the island for the 2017 America’s Cup.

The latest commitment to the project follows a $10 million guarantee for the Bermudiana.

Two years of government guarantees: Budget figures

Guarantees for 2024-25:

Bermuda Housing Corporation: $26.8m

West End Development Corporation: $58.2m

Bermuda Economic Development Corporation: $1.8m

Bermuda Hospitals Board: $727.9m

Bermuda Tourism Authority: $3m

Hotel Bermuda Holdings Ltd: $25m

Bermuda Land Development Corporation: $29m

Bermudiana Development Company Limited: $35m

National Sports Centre: $2.7m

Bda Commercial Bank mortgage guarantee: $50m

Guarantees for 2023-24:

Bermuda Housing Corporation: $28.4m

West End Development Corporation: $60.3m

Bermuda Economic Development Corporation: $1.8m

Bermuda Hospitals Board: $758.2m

Morgan's Point/Caroline Bay: $165m

Bermuda Tourism Authority: $5m

Bermuda Casino Gaming Commission: $9.8m

Hotel Bermuda Holdings: $25m

Bermuda Land Development Corporation: $21.6m

Bermudiana Development Company: $10m

National Sports Centre: $2.6m

Bda Commercial Bank mortgage guarantee: $50m

Lieutenant-Colonel David Burch, the public works minister, said in the House in June last year that an “additional construction loan of $25 million” was in the process of “being finalised to complete this project”.

Mr Burt announced the figure under Section 2 AA (3) of the Government Loans Act 1978.

The guarantee is among the larger on the Government’s books for 2024-25, with the Bermuda Hospitals Board coming top at $727.9 million

However, overall guarantees are down significantly on the previous year’s figures.

A dozen guarantees listed for 2023-24 add up to $1,172.7 million.

Ten guarantees for the upcoming fiscal year total $959.4 million — a difference of $178.3 million.

The Bermudiana Resort project has a lengthy history of investment, which Colonel Burch told the House would be recouped by the BHC through the success of the resort and the sale of condominiums, which would “eventually see every dollar spent on this project repaid”.

Owners of a condo at the resort will be permitted to stay there for up to 90 days a year.

For the rest of the year, the units will be rented out as hotel suites via Hilton’s global sales and reservation system.

The rental income is then shared between owners and the hotel management company.

The Bermudiana development was approved last December for sweeping concessions under Tourism Investment Orders, providing tax relief for up to 15 years to the resort along with Ariel Sands in Devonshire.

The resort will have 94 condo units for sale and 110 hotel keys.

Colonel Burch said in December that construction was expected to finish by July, with Hilton test-running the resort for two months before formally opening.

The resort is among several developments critical for boosting the island’s hotel capacity and a revival in tourism, which has languished since the Covid-19 pandemic knocked out the industry — with the Fairmont Southampton Hotel, the island’s largest, closed ever since.

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Published March 05, 2024 at 7:59 am (Updated March 05, 2024 at 8:16 am)

Premier tables $25m guarantee for Bermudiana

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