Castle Harbour Resort closed for two months.

The hotel said yesterday it was closing the operation from December 1 to February 5 to avoid disrupting customer service with work to upgrade its sewage and fresh water systems.

Hotel manager Mr. Roger Borsink admitted the decision was taken because of poor business forecasts for the period.

The shutdown will lay off 350 workers.

Last night, Tourism Minister the Hon. C.V. (Jim) Woolridge said he regretted the planned closure at a time when conditions were developing to give the Island a business boost.

"We seem to be getting a favourable fare structure from the airlines,'' he said. "I also regret it because various hotels have seen an increase in booking patterns.'' The Minister described Marriott's planned improvements for its waste water treatments facilities and fresh water systems as legitimate. And he recognised the slower December and January months as the most appropriate time for such work.

But Mr. Woolridge said the closure could nonetheless affect the Island's plan to hold onto airlines threatening to cut services if winter business does not improve.

"It could affect our November to March objectives,'' he said.

His officials and industry colleagues have been working for months on schemes to increase arrivals during the historically slow winter months.

Hotels guaranteeing good weather for their customers is one of the more controversial schemes that generally aim to alter the perception of the winter as the "off-season''. Packages are also being produced for dine-around arrangements, transportation discounts and recreation deals.

Work on off-season improvements began early this year after American Airlines said it would consider shutting down the routes if winter business did not improve.

The airline provides vital links to key North American markets through its flights to New York City and Raleigh-Durham, North Carolina. Other airlines are believed to be taking a hard look at the Island in winter.

On August 5, American Airlines initiated a fare-cutting spree that saw fares for Bermuda flights drop an unprecedented 30 percent.

The closure at Marriott will mark the second consecutive winter the hotel has closed. Last year, it was joined by Sonesta Beach Hotel and Elbow Beach Hotel.

Industry watchers said the closures created the unhelpful impression of Bermuda being closed for the winter.

Yesterday, Mr. Timothy Russell of Elbow said his hotel was definitely planning to remain open. Sonesta's managing director Mr. David Boyd replied that his hotel had "not yet firmed up'' its plans. A spokesman for Princess Hotels could not be reached.

In an interview yesterday, Marriott's Mr. Borsink said his hotel's business forecast for the early winter months were "not very good'', particularly for group business.

"Advanced bookings for that time of year are not there,'' he said. "So we thought this was the best time to get this work done.'' The hotel's golf course will remain open throughout the winter.