America’s Cup gives tailwind to Bermuda’s makeover

Bermuda long been a major financial player and has been ranked the world’s second-largest reinsurance market, behind New York. With the America's cup coming in June, it's also ready for the wealthy tourists that follow it.

Hamilton Harbour in Bermuda, which has overhauled its tourism and business sectors. Verena Matthew / Alamy

Bermuda is a constellation of pretty-as-they-come pink-sand beaches and coral reefs a several hundred kilometres from the US mainland. You can wake up early to see the sun rise over Gates Bay or catch the late edition as it sets over Somerset Long Bay. In between, visitors gravitate towards the deep blue reaches of the Great Sound, a natural harbour at the heart of the island chain before dinner at one of the fine fish restaurants or steakhouses.

Now, with the America’s Cup races set to take place at Bermuda in June, this island has a chance to advertise itself to the world. New hotels and marinas are springing up, hoping to attract the attention of a new generation of wealthy tourists and investors.

What they will find is a capital, Hamilton, that has long been a major financial player. In 2015, the Houston-based World Services Group ranked it the world’s second-largest reinsurance market, behind New York but ahead of London. As the oldest remaining British Overseas Territory, Bermuda observes common law and has been careful to adhere to the prevailing thinking on tax havens. In 2010, the OECD included Bermuda on its “white list” of countries deemed “fully cooperative” over international tax policies.

Bermuda’s tourism industry, a mainstay of the island’s economy, has been undergoing a facelift. The government is sprucing up its infrastructure and is building a new passenger terminal at LF Wade International Airport. The new mar­inas will handle the influx of super-yachts expected for this 35th running of the cup.

Hotels are springing up, some new, some rebuilds, as developers look to cash in on global interest in the world’s greatest sailing event.

The Loren, set to open its doors on February 16, will be the first genuinely new hotel to hit the local market in 45 years. With rooms starting at US$450, a luxury spa and beachfront club, two heated pools and dir­ect access to the soft sand of Pink Beach, it is aimed at the market’s upper end.

Caroline Desmarais, The Loren’s head of publicity, says great care has been taken to have the hotel blend in with its surroundings, while catering to the well heeled and well travelled. “Our aim was to give it a streamlined modern feel while retaining some of the rustic charm, like the Bermudian-style roofs,” she says. “It has the luxury feel you would expect to find if you were a seasoned traveller accustomed to flitting between London and Dubai, Hong Kong and St Barts.”

Ms Desmarais has witnessed the latest shift in Bermuda’s status since she moved from Montreal five years ago.

“A few decades ago,” she says, “this really was the place to come. Then there was a lull, and some of the buildings began to look a bit faded. Now it feels like the island has been reborn, and everyone is rushing around pulling their socks up.”

Other hotels are already up and running. The Hamilton Princess, run by Canada’s Fairmont group and combining a hotel, marina and beach club, was reopened in 2015 following a $100 million refit of its 157 suites. It is the official hotel of the America’s Cup, featuring an infinity pool with uninterrupted views of Hamilton Harbour.

Nowhere is Bermuda’s renaissance more evident than in the case of the Azura, a sprawling new-build taking shape on the island’s hilly southern shores. Until a few years ago this was the location of the Surf Side Beach Club, a venerable institution that had seen better days. When the financial crisis hit and the tourists stayed away, Surf Side struggled along for a while before closing its doors for good.

No interest in the site was forthcoming – until news filtered through that Bermuda had won the right to host the America’s Cup. In September 2016, local businessman John Bush III bought the property, pledging to invest $36m to build 48 rooms and suites in the initial phase of development, with the first units set for completion this year. The Azura will range from two-bed condominiums starting at $755,000, up to four-bed villas going for a little under $3m. Each home is to have clifftop views.

Azura’s new residents are most likely, Mr Bush reckons, to come from North America and Europe. “There is a primary geographic pull at work here,” he says. “New York City is only a 90-minute flight away, while London is a little over five hours’ distant. But we have a significant base of visitors from the likes of Hong Kong and South Africa and increasingly the Middle East. It’s tax advantageous to be based in a clean and unspoiled environment with a wonderful monetary auth­ority and first-rate telecoms and medical services. It’s like being in New York or London or Dubai.”

Finally there’s the Ritz-Carlton Reserve at Caroline Bay Resort, a super-luxury new offering with 79 rooms and 157 residences, set to open in stages this year and next. The new resort, stretched across 182 acres of land, includes a new mar­ina, with space for up to 38 ­super-yachts, set to open in time for the first America’s Cup race. Those lucky enough to secure a berth will have a bird’s-eye view of the event from the marina, which is built into a spit of land stretching into the Great Sound.

Craig Christensen, the project’s chief executive, says sales have been going well since the soft launch two weeks ago. “We’ve only just got our sales office up and running,” he says. “But we’ve already had a lot of inquiries, with people visiting the gallery to see what we have to offer. The real marketing push will start in March.”

Luxury is the name of the game. Residences will come with concierge services and, in the larger penthouses, patios and balconies covering a 1,000 square feet of prime real estate. “Anyone buying a residency also has first right-of-refusal on a berth at our marina,” Mr Christensen says.

With a bit of luck and a following wind – the variety needed when the America’s Cup visits – the investments being made in new and remodelled hotels, resorts and marinas will keep Bermuda’s economy powering along for decades to come. Any sense that the island was living in the past has evaporated. “You’re seeing a large influx of capital going into new business and hospitality projects and a new and younger profile of investor and owner flocking to the island,” says Mr Bush. “Bermuda as a destination, while still amazing, had become a little bit old news. That has all changed.”