because costs were getting out of hand, The Royal Gazette can reveal.

Hotel manager Allan Trew admitted final plans are still being worked out even though construction has already started.

But he said the showpiece beauty and health project is definitely going ahead.

The Royal Gazette understands the hotel intended to finalise its plans for the project by last week.

Work will continue throughout the summer and the spa -- which Mr. Trew says will "put Bermuda on the map'' -- is scheduled to open in January 2002.

When asked about rumours that costs for the spa were spiralling out of hand, Mr. Trew said: "That's not an untruth, but it's not uncommon.

"We had grandiose plans and we had a budget, and when we tried to match the plans to the budget, that's where the re-working came into play.

"But it is most certainly a goer. I heard someone ask whether it was going to go ahead and it most definitely is.

"It's going to put Bermuda on the map as far as spas are concerned. We are progressing and the plans are still being finalised.

"We've started construction but the plans are still being finalised and we have made some changes to the original design.'' Bermuda's extraordinarily expensive construction costs have often been cited by potential developers as reasons why they will not build on the Island.

Mr. Trew said the area being worked on for the spa is isolated, so guests will not be affected by the construction.

He said the spa will have around 20 treatment rooms, a cardiovascular room, ladies and gents treatment beauty salons, and specialised spa treatment suites.