Developer Carl Bazarian expects HSBC's Bermuda operations to provide some $120 million in funding for his planned five-star resort in St. George's.

Mr. Bazarian told The Royal Gazette yesterday he has not yet signed a financing agreement with the bank, but expects to any day now.

He also admitted he cannot break ground until a new master agreement for the 30-acre site is signed with Government.

When asked when this agreement might be signed, Premier Ewart Brown's press officer Glenn Jones said: "Amendments to the Master Development Agreement are a normal feature of projects of this kind. Some amendments have been approved by Cabinet and they are being made presently."

Mr. Bazarian said two banks competed to finance the Park Hyatt-managed resort at the site of the old Club Med.

"I think we have selected HSBC/Bank of Bermuda. We are now prepared to sign a term sheet," Mr. Bazarian said. "We are pretty excited about that."

Mr. Bazarian said it's expected the bank would provide what's called "long-term hotel project financing … in the area of $120 million".

He said the total cost of the resort he plans to build in St. George's is in excess of $160 million.

He added that a major equity player, which he declined to name, is already committed to the project.

Mr. Bazarian said once a new agreement is signed with Government the design process should take at least one year to finalise.

But he said he may be able to "move dirt" at the site sooner.

He added: "Government has been great very supportive of us. In fact I would say this has been our best experience than anywhere in the Caribbean."

The design team is being led by Baton Rouge-based architects Coleman & Partners, which has built resorts in Aruba, Florida and Louisiana, including the Ritz Carlton, New Orleans.

They are being assisted locally by s.h.y. Architecture, headed by Juan Smith.

Mr. Bazarian said plans still call for 100 hotel rooms, which will all have ocean views. There will still be 30 fractional units and some 111 residences, plus a spa, beach club and 18-hole Nick Faldo golf course.

The Bazarian group has also just struck an agreement with Government departments on the relocation of a historic cannon at the site.

Despite the progress since Government's development deal with Bazarian over two years ago, many, especially St. Georgians, still remain sceptical they will ever see a new hotel built at the site, which has been vacant since Club Med closed two decades ago.

A string of proposed resort developments during that period all fell through.

But at a community meeting in June, Premier and Tourism Minister Ewart Brown assured St. Georgians a new hotel would be built at the site.

"The promise has been made to the community to develop a five-star hotel and as far as we are concerned that promise is being kept," Dr. Brown told the meeting.

He said financing was at "an advanced stage" and documents would be signed in July.

Mr. Jones told the Gazette yesterday: "The Government and the developer continue to work well together and the progress evidenced in these discussions defies both a regional and global trend which has seen numerous similar projects simply abandoned.

"Mr. Bazarian is an experienced and well-respected developer who often remarks that his working relationship with Bermuda's Government officials is the most productive and efficient of his career.

"We are very pleased with where things stand with this project, but we don't hesitate to point out that, in the prevailing economic conditions, speculative media accounts can stall or even derail progress."

Shadow Tourism Minister Michael Dunkley said he was not surprised to learn HSBC may provide financing.

"HSBC-Bank of Bermuda has shown it's been a good corporate citizen on the Island for some time now," Mr. Dunkley said. "They are big supporters in the community and of people who need funding. And HSBC has been a strong bank through this global financial crisis."

He noted the Premier and bank CEO Philip Butterfield are brothers "and obviously they are doing what they can with their relationship to make things happen. Let's hope it works."

He noted on a global scale a $120 million loan would be a small part of HSBC's business.

The total of the bank's loans to individuals here, including mortgages, amounted to $1,887,467,000 in 2008. Total loans to commercial customers amounted to $477,764,000 last year.

The bank's full-year profit rose 21 percent in 2008, to $348 million. Parent HSBC announced Monday a first-half profit of $3.35 billion.