Clouds beset blue skies as millionaires build exclusive hideaway in the sun

Just over three years ago, a group including three wealthy Irish businessmen decided to invest in a swish hotel in the Caribbean…

Just over three years ago, a group including three wealthy Irish businessmen decided to invest in a swish hotel in the Caribbean.

Mr Dermot Desmond, Mr John Magnier and Mr J.P. McManus had little experience of the accommodation business, but their considerable success in other money-making ventures must have led them to conclude that their purchase of the Sandy Lane hotel in Barbados would be no less fruitful.

They had the resources to spend £38 million sterling (€60 million) purchasing the property, which overlooks the Caribbean sea on the west coast of the island, and plenty of dealmakers' grit. However, the group paid a premium for the hotel, which was valued on Granada's books at £26 million. A valuation by Christie's amounted to £32 million.

Long a haunt of royalty, movie stars, supermodels, affluent business owners and retired statesmen, Sandy Lane was a prestige, high-end business with a world reputation. However, Mr Desmond and his colleagues had other plans for their new hotel, which they purchased from the British Granada group in late 1996. (Granada had acquired the property from the Forte hotel group earlier that year.)

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They announced early in 1998 that they would close Sandy Lane and spend $153 million on a revamp and on golf facilities on the 380-acre estate which adjoins it. Even though the hotel was refurbished in 1992, they planned to knock it down, rebuild a similar, but improved, building on the "footprint" of the old, and re-open in time for the millennium celebrations.

But the hotel is still closed. The shell of the new building and the beginnings of its roof can be seen from the main road nearby in the parish of St James, although high-rolling holiday-makers must look elsewhere in Barbados for a bed for the night.

Though he declined to comment on the reason for the delay or on other aspects of the development, the hotel's manager, Mr Colm Hannon, said the re-opening was now planned for the second half of this year.

Some tourism insiders on the island have expressed doubt that this deadline will be met, although there is certainly a great deal of activity under way on the site at the moment. People passing on the road nearby can see dozens of workers and all manner of diggers, cranes and bulldozers working throughout the day.

It is a big project, ambitious, and the group clearly wants to maintain Sandy Lane's reputation as a luxurious retreat for the well-off.

Curiously, however, explanations for the redevelopment of the hotel are hard to come by. While its owners have stated that the new building will make a "quantum leap in service standards and facilities in setting the standard for all the world's leading resort hotels in the 21st century", local insiders suggest that its rooms were perceived to be too small, especially for the golfplaying US visitors it hopes to attract when its golf courses are complete.

Since it was opened in 1961 on the site of a former sugar plantation by the Anglo-American aristocrat Sir Ronald Tree, the hotel's lengthy list of A-grade celebrity guests has included such figures as shipping magnate Aristotle Onassis, singers Maria Callas and Mick Jagger, actress Joan Collins, musician Andre Previn, former British prime minister Ted Heath and various members of the British royal family.

Nearer home, Irish guests have included members of the Smurfit and Dunne families. The hotel's clients even straddled the great ideological divide - former US president Gerald Ford played golf there and President Fidel Castro of Cuba was another guest.

By all accounts, it was a place of appealing vistas, tall mahogany trees, warm breezes on the veranda and exuberant sun on the beach. The couture and the cuisine were haute; the ambience tropical and intimate. A place where regular guests always took particular suites or certain tables at the restaurant, the contents of its rooms are said to have been auctioned to customers before it was demolished in April 1998.

Luxury will replace luxury in the new scenario. Overlooking about a kilometre of golden beach, the 112-room coral stone hotel will include garden, ocean and veranda suites and two penthouses, according to a tourism brochure endorsed by the Barbados Tourism Authority.

Its centrepiece will be a terraced 30,000-square feet health complex with 14 "treatment" rooms, offering such therapies as seaweed treatment, shiatsu massages, saunas and whirlpool baths "all situated adjacent to a tranquil courtyard, a secluded spa pool, a hydotherapy pool, cool misting jets and a waterfall". Gym and exercise facilities will be provided also, as well as taichi and yoga classes and a salon for hairdressing and facials.

The golf development is ambitious too. Designed by the vaunted US architect Tom Fazio, who once turned part of a desert into a tree-lined golfing haven, two full courses are currently being constructed on the hills overlooking Sandy Lane and its existing nine-hole course.

Mounds of earth are being shifted by the tonne and limestone rock beneath the ground is being cut before being manicured by the gardeners. The courses, which will have impressive views of the Caribbean sea and Sandy Lane itself, will be known as the Green Monkey and the Molyneux, after an estate nearby.

A tunnel under the main road between the hotel and golf courses will accommodate golfing carts and pedestrians. Many of the hotel's kitchen and service facilities will also be located underground.

Clearly, this is an expensive redevelopment, though it will avail of generous tax breaks. But the very fact that the project is so far behind schedule indicates that it is likely to exceed its original stated budget of $153 million, though to what degree is unknown - Mr Desmond's spokeswoman in Dublin was unable to answer questions about the project and a hotel spokesman in Barbados declined to comment on the budget.

As well as the original outlay of £38 million on the hotel, additional lands on the Norwoods and Bennetts estates nearby were acquired in separate transactions for undisclosed sums. Sources in Barbados estimate that these lands would bring the total space available from 380 to about 500 acres.

This is significant. A major part of the plan is to sell up to 70 plots of land surrounding the golf course for residential development. It is unclear whether completed accommodation or undeveloped plots will be sold. Either way, this will generate significant revenue. Ernst & Young Real Estate Services in Barbados recently advertised a four-bedroom villa and two-bedroom cottage on 1.25 acres at Sandy Lane for $2.5 million.

Not everyone in Barbados is happy with the development. One worry in the tourism trade is that the closure of Sandy Lane for such a long period and the recent closure of the island's Hilton Hotel, also for renovation, is depriving the island of revenues from high-spending visitors. Although luxury accommodation is available elsewhere on the island, tourism trade insiders say no one hotel has taken up the slack.

Further concerns have been voiced by a group of more than 50 residents on the Sandy Lane estate, where Mr Magnier has a home, who secured an interim high court injunction last year against the construction of a water desalination plant and a services building for air conditioning. They claimed that these developments contravened restrictive covenants on the land, but it is understood that the injunction has been lifted following an interim settlement which is subject to high court approval.

Other difficulties were encountered with the US construction firm Brown & Root, the development's original project managers who are no longer retained by Sandy Lane.

In November 1998, about 120 workers on the site stopped work for a number of hours, protesting about work conditions. Asked about this, a hotel spokesman said: "They did not walk off on Sandy Lane. They walked off on the contractors."

Earlier, in May 1998, the Barbados National Trust protested at the destruction of the original hotel building. "The main building of the Sandy Lane Hotel is architecturally important and is of historic significance with regard to the tourist industry," it said.

A further complication arose last September, when five construction workers suffered slight injuries.

Meanwhile, the hotel's restaurant re-opened last December to positive reviews. Known as "The Restaurant", the food is said to be excellent. But observers suggest that Barbados aficionados would prefer if it were on the waterfront, like many other luxury eateries on the island.

For the consortium including Mr Desmond, Mr Magnier and Mr McManus, three men who had made their respective fortunes in stockbroking, horsebreeding and high-stake gambling, the redevelopment of the hotel is without doubt an expensive, but prestigious project. But it remains to be seen whether the new Sandy Lane will be the institution it once was.