A new hotel created from the shell of Dockyard’s historic Victualling Yard is on the cards.

But the development — part of a multimillion dollar plan to make the old Royal Navy base a key hub for tourists and residents alike — is just one part of the strategy, bolstered, in part, by the upcoming America’s Cup finals.

Andrew Dias, general manager of the West End Development Corporation, said a $60 million deal agreed with an island consortium, which included a glass dome over the yard to create an all-weather entertainment area as well as a 125-room hotel, was shelved last year after the developers failed to secure funding.

But he added: “We are under a memorandum of understanding with another submission we were given and they want to put in a hotel.

“We are still in the very early stages — it’s exciting and initial indications are that finance will not be the reason for it not to happen.

“It’s anticipated that what will be there is a major structure in and around the existing buildings.”

Mr Dias declined to name the firm, but said it was a Boston-based company with an established track record in development “all over the US and globally”.

He added: “Over the coming months, by the new year, we will be able to release something which says we are on the right track and this is what we are looking at.

“But it’s a little bit premature to put out ideas and concepts.”

Mr Dias said the hotel plan was part of a long-term drive to turn Dockyard into a year-round hub of activity.

He explained that cruise ships boosted the area over the summer months, but businesses in Dockyard experienced a drop-off in trade over the shoulder season.

Mr Dias said: “We have always wanted a large hotel development in this end of the island so we can increase our critical mass all year round.

He added that a hotel could also open the door to lucrative conference business, which would stimulate trade around the area.

Mr Dias said: “What we need is more year-round critical mass — it could be locals, tourists, conferences because they then feed off each other and make it less seasonal.”

And he added: “If we get this hotel development, or another development of magnitude, we may be able to help Government and become an asset to the coffers.”

Bermuda-based Wilson Allen Architecture and Interior Design were the team selected to develop the Victualling Yard, but dropped out after a memorandum of understanding with Wedco — which had already been extended — expired last October.