Premier and Tourism Minister Ewart Brown yesterday said he was saddened by news that 80 Bermudians would lose their jobs with the closure of Elbow Beach.

After years of rumours that the South Shore property would undergo a major redevelopment, hotel bosses announced its main building would close at the end of next month.

The Paget resort is to reopen in March, when it will focus on the luxury cottage market as it awaits the end of the economic downturn.

General manager Frank Stocek said 160 people would lose their jobs, half of whom are Bermudians or spouses of Bermudians.

Yesterday, Dr. Brown said: "The closure of any hotel property is difficult at any time, but this is no typical closure. The owners of Elbow Beach have made it clear that they are committed to Bermuda and that this closure is an opportunity to better enhance their product.

"We never want to see Bermudians losing their jobs but I know that the management and the Bermuda Industrial Union are working on an equitable package for the dedicated staff affected by this transition.

"My hope is that where possible members of the Elbow Beach team will remain in the hospitality sector where their talents and unique service are still in demand."

A press statement indicated that the Premier believed the hotel was in "dire need of upgrading" and added that he was "expressing optimism on the future".

"The rooms that will replace the old-style accommodations in the old building will make a welcome addition to the improved product that will come when other hotels are developed," he said. "Elbow Beach will then be able to compete with brands like Park Hyatt, Four Seasons and St. Regis."

Ground at the three properties Dr. Brown mentioned has yet to be broken.

The press statement added that Elbow Beach will neighbour the proposed Four Seasons to be developed at the site of Coral Beach/Horizons.

News of the hotel's closure came only hours after the Progressive Labour Party's website proclaimed: "The Platinum Period revitalisation of our tourism product is continuing to pay dividends."

The site was referring to Bermuda being named the number one island in the Caribbean and Atlantic in the 2009 Condé Nast Traveler Readers' Choice Awards.

Government's first concern on hearing news of the hotel's closure was the future of those made redundant said Acting Labour Minister Walter Roban.

"I have asked the team at the Department of Labour and Training to devote any and all available resources to assisting where they can," he said. "I want to remind them that there's a full gamut of services available such as job placement and career guidance. And the department stands ready to assist."

Bermuda and the world faced tough economic times ahead, Mr. Roban added.

"And without question, we anticipate that we will continue to face workforce challenges due to the current economic climate."

Shadow Tourism Minister Michael Dunkley said yesterday marked a sad day for Bermuda tourism.

"The indefinite closure of this long-standing jewel of Bermuda tourism is a major blow to Bermudian prestige and pride and a measure of just how seriously endangered the industry has become."

Mr. Dunkley said he believed that the worldwide recession played a factor in the decision but added he believed the Ministry of Tourism's marketing has been mismanaged for several years. He called again for an independent tourism authority to be established and called on Government to help retrain those made redundant.

"Finally, the closure of this great hotel on Dr. Brown's watch — the man who continues to promise numerous new hotel openings — says to us that we are falling backwards, not moving forwards," he said.

"In that regard, we would urge him to get real: stop the spin, stop misleading people about the prospects for new hotels with timelines that have yet to be delivered. It does no one any good.

"People need to be given good information to make the best decisions. The Premier clearly would have known about Elbow's closure last week, but that did not stop him from telling Bermudians that we are 'holding our own' in tourism.

"Really? Is that what this is?"

In tomorrow's newspaper general managers from hotels across the Island weigh in on the impact Elbow Beach's partial closure will have on Bermuda's brand and the hospitality industry.

In today's business section, heads of the international business community speak of the impact Elbow Beach Hotel's indefinite closure will have on their industry.