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Senator warns new developments will put pressure on the economy

LESS than a hundred metres from his front door, Warwick resident and UBP Senator E.T "Bob" Richards is once again facing a major development. Seventeen years ago he led a neighbourhood protest against the development of the Ritz-Carlton on the very same spot along Bermuda's south shore.Sen. Richards (pictured), recalled yesterday how despite his best efforts and complete lack of support from environmentalists in 1989, the neighbourhood "lost the battle" and development of the 11-acre wooded property was given the go-ahead.

However, due to a lack of funds development never commenced.

Late last year Atlantic Development revealed plans to develop the same property, one of six major developments, and one of five along South Shore.

While Sen. Richards is concerned about the proposed plans, he told The Mid-Ocean News that he and his family had always hoped for a low-rise development, as opposed to something on a "massive" scale.

He explained that when plans were revealed in 1989 to build a Ritz-Carlton hotel, the neighbourhood stood up in protest, but did not get the support from environmentalists because, he believed the property had been developed at least twice before with hotels and a nightclub.

Sen. Richards added that he was still very much in the dark as far as the latest development was concerned because he had not seen any plans and therefore could not say too much about it.

As for the neighbouring Southlands development, he said he was not entirely opposed to it, but felt a resort on this scale would have a huge impact on the local economy and showed a lack of economic planning on Government's part.

"I accept the fact that we could use some new hotels in Bermuda, but I just feel that we need to be very careful how we go about it and phase them in gradually, considering the proposed scale of these developments," he said.

Southlands Resort Development Limited is proposing a two-phase redevelopment of the 37-acre estate to create the hotel resort that slopes down to the beach with South Shore tucked out of sight beneath a landscaped land bridge.

Phase one, set for a 2008 opening, will add 296 guest suites with a total of 371 bedrooms, giving it the potential to accommodate nearly800 guests.

An additional 42 residential three-bedroom units are also planned.

Developers estimate the resort will provide employment to more than 400 staff and herein, Senator Richards said, lies the problem.

He felt Government and the public in general did not understand how an "overheated economy" drives up the cost of living and the availability of affordable housing.

He explained that overheating is when an economy grows faster than its natural capacity to grow. "Sort of like exceeding the economic speed limit," Sen. Richards said.

This, he added, generally causes inflation and in Bermuda also means having to import labour by the thousands, thus putting more pressure on housing.

While the developments will offer potential employment to locals, he warns that foreigners will be needed not only during the construction phase, but also to fill the jobs left vacant by locals who will leave their positions at other hotels and restaurants for jobs at the new resorts.

And this, he warns, will only worsen the affordable housing crisis in Bermuda as rentals continue to increase while incomes remain the same — hurting lower income Bermudian families the most.

"There seems to be a disconnect here on the part of government and people at large who think there is no connection between a super-heated economy and affordable housing. There is a direct connection — you can't have an economy breaking its own speed limit and not have consequences."

As for how the proposed developments across the island will impact the already staggering hotel occupancy rate, Sen. Richards quoted the Hollywood blockbuster Field of Dreams — "If you build it, 'they' will come", or so, he said, it is hoped.

Chairman of the Bermuda Hotel Association, Mike Winfield agrees and feels new hotels, of the right calibre, would stir interest in Bermuda.

"It should not hurt existing hotels as long as those hotels are competitive in their own niche," he said. "I do not believe the smaller, more unique Bermudian style properties like Reefs, Pink Beaches, Cambridge Beaches for instance, should be that effected."

However, he warned that hotels lacking unique characteristics would find themselves under renewed pressure.

Of greater concern to the Hotel Association is the question of finding hospitality staff — already a problem world-wide and a challenge in Bermuda as far as encouraging locals to enter this field.

"There is also a real question as to whether many of the support services — food importers, electricians, plumbers, transportation etc. can support the amount of new rooms that are being proposed," Mr. Winfield added.

"We are already facing many challenges getting the levels of service from that infrastructure that we need to be able to sustain our levels of service."

He warned that Bermuda would need to generate that much more electricity and as a result suffer more pollution, while beaches, restaurants and shops would have to accommodate that much more people.

All of these, he felt, were issues that needed to be considered.

"There is a certain number of overall rooms that any resort destination needs to be sustainable, Mr. Winfield said.

"With the conversion of many historical hotel rooms to fractional/residential and the straight loss of other hotel rooms, we are very close to that level."

Senator concerned by new developments