Fairmont Hotels and Resorts has applied for planning permission to build 130 villas on the grounds of the Fairmont Southampton.

Some units will overlook the golf course, but an accompanying report by Bermuda-Caribbean Engineering Consultants says the fairway itself will remain intact.

The report states: "The overall golf course will remain as a par three 18-hole golf course, much as it exists today. The previous concept of converting the golf course to a branded short game golf course and academy has been abandoned."

Two years ago, up to 600 neighbouring residents signed a petition objecting to Fairmont's original plan for 91 golf villas and 54 other units on the course, reducing the number of holes from 18 to ten.

The mixed-use development of fractional units, townhouses and villas will now only result in the relocation of the 14th green and tee, plus a new 18th tee and green.

Bermuda-Caribbean Engineering Consultants say the resort development forms "a critical component of Fairmont's restructuring and revitalisation".

Since acquiring the hotel in 1998, the Fairmont group has invested $122 million in remediation work and facilities upgrades, following Hurricane Fabian.

But the consultants' report states: "In spite of this significant investment, the resort continues to struggle somewhat in competing for business due to a lack of more up-to-date product offerings and enhanced amenities.

"Both annual occupancy and rates are lower than expected compared to similar resorts in the US and other parts of the world. Expenses are high due to its island location. These factors combine to negatively affect the returns on investment from this property.

"It has become very clear that it is necessary for this resort property to change in order to survive in this very competitive world. Built in a different tourism era, the resort is simply not able to compete for today's tourism dollars."

The consultants say fractional units for sale and rent are necessary to create additional product offerings for tourists.

The report says: "The fractional ownership concept proposes to introduce exciting new ideas into the resort in the form of residential accommodation in the concept of a branded luxury residential club."

Premier Dr. Ewart Brown, as Tourism Minister, gave his consent to the development application on June 2. As Minister, his approval is required under section 29 of the Development and Planning Act 1974 and the Planning Statement of the Draft Bermuda Plan 2008.

There are eight proposed areas of development:

Golf Course: A new 18th tee, fairway and green is planned, plus relocation of the 14th green and tee. There will be no loss of yardage however, according to the report.

Turtle Hill Fractional Units: 57 units housed in eight two/three storey buildings, to create a "luxury private fractional ownership club". Appealing to "upper income buyers", the units will be set around a private complex with arrival plaza, two tennis courts and an infinity pool.

The consultants say: "The Turtle Hill Fractional Units will provide a sense of 'belonging' to a private club set in the midst of a high end resort." They will be built "in harmony with the natural landscape".

Turtle Hill Villas: Built to the east of Turtle Hill, this accommodation will consist of seven two-storey villas.

Golf Fractional Units: Located on the hillside overlooking the golf course, to the south-west of the hotel, 14 fractional units will be built in four two-storey buildings, with accompanying spaces for golf carts. Marketed to golfers, the units will be available for home ownership.

Golf Villas: Twenty villas to the north of the golf course clubhouse, housed in seven two-storey blocks. Amenities will include a swimming pool and garden, plus a new driveway providing access from Harbour View Drive.

Hilltop Villas: Ten units will be built in three two-storey buildings to the north-west of the hotel, with access from Lighthouse Road.

South Road Townhomes: This part of the development will consist of 22 townhouses in three two-storey buildings, accessed off South Road.

"These units are specifically intended for sale to the local Bermudian market," the consultants' report says.

Fairmont Beach Club: The existing tennis courts near East Whale Bay are to be replaced by additional food and drink facilities. The Beach Club will also have a fire pit, bar, cabanas, pool and waterslide, plus possible grotto and jacuzzi pools.

The Fairmont group has also submitted a 'change of use' planning application to turn Astwood Cove from 'tourism' to 'residential', in order to create additional staff housing.

The consultants' report however, claims there will be minimal disruption and "no redundancies" resulting from any construction of the resort development.

"It can all be implemented without any closure or loss to the existing hotel facility in the resort.

"There will be no closing of the hotel," the report states.