U.S. Virgin Islands

Water Island


One of the most famous novels about the Caribbean was based on the hotel here.

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At 491-acres, Water Island is the fourth largest of the U.S. Virgin Islands. It can be reached from the Crown Bay Dock on the west side of the city. In its earliest incarnation as Fort Segarra in World War II, it underwent an amazing metamorphosis to become a one-time exclusive resort.

It is such a unique tale that it helped inspire Herman Wouk's Don't Stop the Carnival, a classic novel describing the pitfalls and heartaches of Caribbean hotel ownership. Once you read this book, you'll better understand why things so often go wrong at tropical resorts.

After WWII Army troops pulled out of Water Island , the Chemical Warfare Division laid claim to it for experiments with poison gas. The program was discontinued in 1950, and the Army did nothing more with the island.

In 1951, retired New York stockbroker Walter H. Phillips and his wife visited Water Island in search of a likely homesite.

Although the land was deserted and desolate without a single resident, Phillips decided the island had resort potential. He enlisted the help of local officials who wanted to see the island developed, and a bill was passed through Congress that transferred ownership of Water Island from the Army to the Interior Department.

Phillips then leased the entire island--without charge--from the government for a period of 40 years in return for developing it. In essence, Water Island became a separate principality: exempt from all taxes, it was up to Phillips to supply all roads, garbage collection and other services.

In addition to constructing the hotel (now closed), Phillips was also leasing individual land plots for $2,500, and many of his leaseholders were converting old gun turrets, concrete latrines and soldiers' barracks into small homes and apartments.

The island's rugged terrain has several roads crisscrossing it. There are still a few remains of old Fort Segarra to see. Iguanas and hummingbirds are also commonly spotted on Water Island treks.

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