The Bermuda Government has guaranteed a $5 million loan to Arch Reinsurance for the redevelopment of Morgan’s Point.

The announcement was made by Finance Minister Bob Richards at the House of Assembly this morning.

“It is generally not the policy of the Ministry of Finance to issue guarantees to the private sector unless the matter is of national importance,” Mr Richards said.

“However, the Island has not seen a new hotel development for some time and the Government strongly supports this project and the economic benefits that it will bring to Bermuda.

“With the America’s Cup announcement, we must do even more to attract local and foreign capital to our shores to develop our tourism product.

“I am confident that, if satisfactory financing is obtained, this development will turn a brown field site into a stunning new resort, leading Bermuda back into the forefront of the hospitality industry.

“Once constructed, the project will create numerous jobs. Additionally, the total build will generate significant revenue for the Bermuda Government.”

The developer, Morgan’s Point Ltd (MPL), plans to build an 84-room boutique hotel, 147 residences and a marina at the Southampton peninsula.

“I can now confirm that Government has provided a guarantee to Arch Reinsurance Ltd on behalf of the MPL to provide credit support for a $5 million loan,” Mr Richards added.

“This loan is for the purpose of meeting reasonable expenses incurred by MPL in connection with the first phase of the Morgan’s Point project, including expenses relating to architecture, design, construction engineering and professional advice and services.

“The Government has guaranteed the full and prompt payment of the principal of, and interest on, the loan.”