Resort owners have confirmed that residential units are planned for land surrounding the Fairmont Southampton hotel.

Gencom, a Miami-based investment firm, added that the construction of villas was not expected to start until after the completion of renovations to the existing property.

A Special Development Order was granted in 2009 for 130 fractional tourism and residential units at the hotel but the present owners did not say how many buildings could be on the horizon.

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Fairmont Southampton 2009 SDO

Gencom acquired the Fairmont Southampton in 2019 after its purchase of Westend Properties, an on-island firm.

Karim Alibhai, the founder and principal of Gencom, said: “Projects of this nature across the board, whether it’s in our portfolio or what you will see in the US, Central America and other places, do need a residential component to be able to afford the amenities and all the different things you have to build for these projects.

“This project actually was granted an SDO that was never finally signed because the then ownership group was not going to do it.

“So, yes, we do need to do a level of residential development.

“It will be very thoughtfully done that marries into the project vision that we have.

“It’s important as part of our transaction costs that that gets done and also, I think it caters to future needs of residential that Bermuda is going to continue to need as it attracts more people, which more people means better economic spend.”

He added: “I think when we present this to the people … I think they’ll see it’s very well thought-out and done.”

Mr Alibhai said that there was not yet a “full breakdown” of the number of properties that could be added to the site.

He explained: “The total square footage that was approved at the time was over 300,000 square feet and there will be some addition to that but we haven’t worked through all those details.”

Cheryl Jones, an independent consultant to Westend Properties and Gencom, said that much of the land earmarked for development was on Turtle Hill.

She added: “Then there are some parcels around the hotel that has golf villas and hillside villas.

“Then there are some spaces along South Road that was initially approved as part of the 2009 SDO.

“The 2009 SDO is still in effect. The previous ownership just never executed on it.”

Ms Jones explained that although the resort’s golf course — voted the world’s best par 3 in 2020 by World Golf Awards — was called Turtle Hill, there was also a plot that was known as the “Turtle Hill parcel”, which was “completely vacant”.

She added: “The location that we’re speaking of is not part of the golf course.”

It was reported in 2013 than much of the original SDO mentioned Turtle Hill, just east of the Fairmont Southampton property.

Ms Jones admitted that the company was “looking at the opportunity of potentially converting some of the golf into residential if it makes sense”.

She added: “Right now, that wouldn’t be our first development opportunity.”

Ms Jones said: “Keep in mind, what we’re proposing or what we’re looking at would be a very long-term, 20-year buildout — nothing that would be significant all up front.”

She added that the hotel owners were represented in the scheme by Bermuda Environmental Consulting.

Ms Jones said: “We’re in the process of completing trafficking impact studies and economic impact studies as well.”

She added that any residential development would come after the hotel renovations, which are expected to be worth about $200 million.

The 2009 SDO for the Fairmont Southampton was highlighted by the Bermuda Environmental Sustainability Taskforce last year when the group raised concerns about changes to the way the orders are granted.

BEST explained that legislative amendments would mean that the Government could approve future SDOs and Emergency Development Orders by negative resolution.

The group said: “It is understood that this will allow the minister and government a possible way to avoid having SDOs tabled and debated in the House before coming into effect.”

Kim Smith, BEST’s executive director, added last July: “Of imminent concern is the Fairmont Southampton.

“We believe that the owners, Gencom, the same owners as Tucker’s Point, have commissioned an environmental study of that property. Therefore, we fear it is highly probable that a new SDO will be applied for in the near future.”

She said: “Though we do not know the details, it is possible that a new SDO will permit the property owners to sell off a significant portion of their property for high-density residential development.”

Ms Smith added that “major decisions” about proposed development at the hotel “should not sidestep a full debate in the Houses of Parliament”.

The Development and Planning Amendment Act 2021 provided that public consultation of any environmental impact assessment of a proposed development would be mandatory.

Mr Alibhai said that residential units at Gencom’s other projects often became part of rental programmes because owners used them for a maximum of 90 days a year.

He explained: “They then give it to the hotel, which brings a lot more tax dollars to the government, a lot more transient benefits to, again, airlift, the taxis, the restaurants.

“So it’s actually not just pure residential but actually generates a lot more economic benefit for both government and the people.”

* To see the 2009 Special Development Order for the Fairmont Southampton, click on the PDF under “Related Media”.