Plans to build a new luxury hotel and marina at Morgan’s Point moved a step closer last night with news that developers have received financial backing for the project.

Morgan’s Point Ltd announced it had received an initial $5 million commitment in financing from Bermuda-based international insurer and reinsurer, Arch Capital Group Ltd, towards the first phase of the project.

The initial stage of the development involves the construction of an “ultra premium”, 84-room boutique hotel, 147 residences and a marina at the Southampton site.

“We are pleased to invest in the first phase of the Morgan’s Point development,” said Preston Hutchings, senior vice president and chief investment officer of Arch.

“This is a project that is important to Bermuda’s residents and businesses. Its success will benefit both our shareholders and our employees.

“Once the project’s plans are fully prepared, submitted and approved, we expect to be in a position to expand our commitment.”

Arch’s initial investment of $5 million represents lead financing from a group of other Bermuda international insurance and reinsurance companies who have expressed their interest in a similar agreement.

A spokesperson for Morgan’s Point Limited said: “It’s anticipated that Arch will provide further details about its investment in Morgan’s Point once plans for the first phase of the development have received final approval from the Department of Planning.

“We expect to be able to provide additional information about other investors in the Morgan’s Point development in the next few weeks.”

The firm’s CEO and president Craig Christensen, added: “We extend our sincere appreciation to Arch for embracing the vision we have for Morgan’s Point.

“Arch’s support for a new, luxury tourism product underscores their belief in Bermuda’s future and their willingness to invest in our community.”

Full plans, together with an environmental-impact statement, have been developed by lead architectural firm, Cooper Gardner, working with SB Architects, a US-based firm that specialises in the design of hotels, resorts and destination resort communities.

Mr Christensen said that the plans will be ready for submission to the Department of Planning early next year.

Full construction is expected to begin once planning approval has been received.

The 75-acre peninsula at Morgan’s Point has been largely unused since the US Navy left it in 1995.

The Southampton property, previously known as the Naval Operating Base (NOB), played a crucial role for American forces during the Second World War as well as the Cold War.

The facility was used by seaplanes to launch patrols of the North Atlantic for German submarines during the Second World War. Morgan’s Point and the nearby Tudor Hill facility were later used to monitor sonar rays searching for Russian submarines trying to get across the Atlantic to Cuba.