An affordable housing development failed because campaigners wanted to keep black people off the South Shore of the island, the public works minister claimed yesterday.

Lieutenant-Colonel David Burch said the Grand Atlantic scheme was a victim of “sabotage”.

He added: “Black people are not supposed to have beach access on South Shore Road. That’s the bottom line.

“And so you have all of these people railing against housing development that would have provided that access to black people in this country.

“The fact that it failed was a direct result of sabotage by certain people and I think that we have refashioned this.”

Colonel Burch’s outburst came after a ribbon-cutting ceremony was held to relaunch the site as a hotel and condominium complex to be called the Bermudiana Beach Resort.

Environmental charity BEST, one of the most vocal critics of the Grand Atlantic development and then headed by Stuart Hayward, could not be contacted for comment last night. Campaigners against the complex said that erosion could pose a risk to the site and that work needed to be done to shore up the nearby cliffs.

The resort, created from the former apartment blocks and scheduled to open in July next year, will have access to the marketing and reservations system of global hotel chain Hilton as a result a deal struck with the developers.

A total of 71 of the 78 condominiums are being refurbished with new kitchens and bathrooms, additional windows and new floor coverings. The remaining seven apartments will be converted into a reception area, bar, restaurant, meeting room, commercial kitchen, spa and operations support areas.

Elevators will also to be installed in eight of the nine condominium blocks and two swimming pools will be built.

The developers will also install two Hill Hiker trams to provide access to the beach below and add stability to the cliff face. Grand Atlantic was launched by an earlier Progressive Labour Party government in 2011 as a hotel and affordable housing development.

But the scheme was branded a failure when only two out of the 78 condo homes were sold and the hotel was never built.

The former One Bermuda Alliance government confirmed in April 2014 that it had signed a contract to “upgrade and reposition” the complex as a holiday destination with MacLellan & Associates, a Caribbean-based tourism and leisure firm, headed by Robert MacLellan.

A memorandum of understanding was signed with the then One Bermuda Alliance government, but the deal fell through because of problems in securing financing.

Colonel Burch said that MacLellan & Associates was now hiring Bermudians to staff the resort. He said: “The hotel developer, Mr MacLellan, has a track record of hiring local people throughout all of his properties in the Caribbean.

“There have been discussions with the Bermuda College already about those people that are in the hospitality industry in the hotel to look to recruit them for this property.”

Colonel Burch said at the ribbon-cutting ceremony: “It was soon after the 2017 General Election, August 14, 2017 to be exact, that I held my first meeting on this proposal and on March 28, 2018 that I first publicly announced the partnership to convert the Grand Atlantic site into a new mid-market boutique hotel to be renamed the Bermudiana Beach Resort.”

The Royal Gazette reported in February 2017 that the Bermuda Housing Corporation had reselected MacLellan & Associates to redevelop the site into a resort.

The report added that “final negotiations” were under way with an “international boutique hotel brand”.

Colonel Burch said that the properties were built on stable land despite claims that cliffs close to the resort were unstable and could collapse on to a beach area below.

He explained: “We’re built on the same piece of property and real estate as the reefs and if you come down the entire South Shore every property that’s build on the same shoreline is going to be faced with the same challenges.

“And I think if you go to the back of the building you’ll see what the buildings are a considerable distance away from the actual cliff face itself.”

He added: “We have very stringent planning rules in the country generally and I don’t think that planning would allow anybody to build these units with the risk of them falling into the South Shore. It’s a red herring.”

Colonel Burch said that projects to build additional condos and affordable housing complexes elsewhere were in the early stages of development and declined to comment further.