It’s gone. Honestly, that’s the first thing you need to know before you start looking for a booking link or trying to find a "grand opening" date for the Sugar Bay Resort Virgin Islands. If you head over to Smith Bay on the northeast end of St. Thomas today, you aren't going to find a bustling lobby filled with people sipping rum punches. You’re going to find a massive, silent concrete skeleton that’s been slowly losing its battle with the Caribbean salt air for years.
It is weird.
For decades, Sugar Bay was the "it" spot for families and all-inclusive fans. It sat on 31 beautiful acres, overlooking Water Bay and the British Virgin Islands. It had those iconic interconnected pools and a beach that felt like a private slice of heaven. But then 2017 happened. Hurricane Irma and Hurricane Maria—a brutal one-two punch—tore through the U.S. Virgin Islands with a ferocity that changed the landscape of the territory forever. While other resorts like Frenchman’s Reef (now the Westin and Morningstar Buoy Haus) eventually found their way back to life through massive corporate injections of cash, Sugar Bay just... stayed broken.
What actually happened to the Sugar Bay Resort Virgin Islands?
Most people assume a resort this big just fixes its roof and reopens. It isn't that simple. Not even close. When Irma hit, it didn't just break windows; it compromised the very infrastructure of the buildings. We’re talking about massive water intrusion, mold issues, and structural damage that costs tens of millions—if not hundreds of millions—to remediate.
The resort has been stuck in a cycle of "will they or won't they" for a long time. It was originally a Wyndham property, then it went independent as Sugar Bay Resort & Spa. After the storms, it became a casualty of insurance disputes and the sheer logistical nightmare of rebuilding in the Caribbean. Shipping materials to an island is expensive. Labor is scarce. And when a property sits vacant for seven or eight years in a tropical climate, the jungle starts to take it back.
You’ve probably seen the photos. They are haunting. People often sneak onto the property (which we definitely do not recommend) to take "ruin porn" photography. You can see the remnants of the lobby, the empty pools filled with murky rainwater, and the balconies where thousands of tourists once watched the sunrise. It’s a stark reminder of how fragile the tourism industry can be in the face of a changing climate.
The ownership drama and the "reopening" rumors
Is there hope? Kinda.
There have been several false starts. In recent years, there was significant buzz about a group called Apple Leisure Group (part of the Hyatt family) potentially taking over or managing the site under the Dreams or Secrets brand. This makes sense on paper. St. Thomas is desperate for more room inventory, especially in the all-inclusive sector which is currently dominated by Bolongo Bay Beach Resort.
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However, the reality on the ground is that the Sugar Bay Resort Virgin Islands remains a "distressed asset." In real estate terms, that means it’s a mess that requires a very specific type of buyer with very deep pockets and a lot of patience. Any developer taking this on has to decide if they can renovate the existing structures or if it’s cheaper to just bulldoze the whole thing and start over. Most experts lean toward the latter. The "skeleton" of the resort is likely too far gone to meet modern building codes or luxury brand standards without a total teardown.
Why does everyone still talk about it?
Basically, because it was iconic. If you grew up going to St. Thomas in the 90s or early 2000s, Sugar Bay was the pinnacle. It had a specific layout—built into a steep hillside—that offered some of the best views on the island.
- The pools: They were tiered, flowing into each other with waterfalls.
- The beach: Small, but protected.
- The location: Literally minutes from Coki Point and Coral World.
That proximity to Coki Beach is a huge factor. Coki is arguably the best snorkeling spot on the island accessible by land. Having a major resort right next door provided a steady stream of revenue for local vendors and taxi drivers. Now, that corner of the island feels a bit lopsided. You have the luxury of Margaritaville Vacation Club right next door, which is thriving, but then you have this massive dark spot where Sugar Bay used to be. It’s a weird contrast.
The reality of visiting Smith Bay today
If you are planning a trip and were hoping to stay at the Sugar Bay Resort Virgin Islands, you obviously need a Plan B. But you should still visit that area. Smith Bay is gorgeous.
Lindquist Beach (part of Smith Bay Park) is right around the corner from the ruins of Sugar Bay. It is, hands down, one of the most beautiful beaches in the world. It’s a protected park, so it doesn't have the high-rise hotels or the noise of Magens Bay. If you stand on the shore at Lindquist and look left, you can see the abandoned Sugar Bay buildings looming on the cliffside. It’s a bit surreal to see such natural beauty juxtaposed with a man-made ruin.
Alternatives that actually exist
Since you can't stay at Sugar Bay, where should you go? It depends on what you liked about it.
If you wanted the all-inclusive experience:
Bolongo Bay is your only real bet on St. Thomas. It’s smaller, family-run, and much more "old school Caribbean." It doesn't have the massive scale of Sugar Bay, but it has a heart that the big resorts sometimes lack.
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If you wanted the views and the northeast location:
The Point Pleasant Resort is right nearby. It’s a condo-style resort built into the same kind of steep hillside. You get the same views of St. John and the BVI, and you’re close to the Red Hook ferry dock.
If you wanted luxury:
The Ritz-Carlton St. Thomas is just a short drive away in Great Bay. It’s obviously a much higher price point, but it’s fully operational and stunning.
The "Ghost Resort" effect on St. Thomas
It’s not just Sugar Bay. St. Thomas has a history of these ghost resorts. For years, the old Renaissance Grand Beach Resort sat empty nearby before eventually being transformed into Margaritaville. The island has a way of swallowing up these properties.
The local government, the USVI Department of Tourism, and the Port Authority are all incentivized to get Sugar Bay back online. The loss of those hundreds of rooms means less hotel occupancy tax and fewer jobs. But the legal hurdles are massive. When a property is tied up in insurance litigation or complex bankruptcy filings, it can sit for a decade. We are approaching that decade mark for Sugar Bay.
Some locals have suggested the site be used for something else—housing, a park, or a smaller boutique development. But the scale of the site almost demands a major hotel brand to make the numbers work.
A warning for travelers
Be careful with what you find online. There are still "zombie" websites out there. You might find an old travel blog or a defunct booking site that still lists the Sugar Bay Resort Virgin Islands as if it’s open. I’ve even seen AI-generated "top 10 hotels in St. Thomas" lists that include it.
Don't be fooled.
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Always check the most recent Google Maps photos or TripAdvisor reviews. If the last review is from 2017, that’s your red flag. The island is changing fast, but Sugar Bay is currently a time capsule of a pre-hurricane era.
Environmental and safety concerns
There is a darker side to the abandoned resort. When a structure of that size is left to rot, it becomes an environmental hazard. There’s the risk of debris blowing into the ocean during smaller storms. There's the issue of stagnant water in the old pool systems becoming a breeding ground for mosquitoes carrying Dengue or Zika.
Then there’s the safety aspect. The buildings are not structurally sound. The stairs are crumbling. The railings are rusted through. If you’re a "travel influencer" looking for a cool "urbex" (urban exploration) spot, think twice. Aside from trespassing laws, the physical risk is high. The USVI police do patrol these areas, and the private security for the neighboring properties keeps a close eye on the site.
What’s the next step for this property?
The most likely scenario for the Sugar Bay Resort Virgin Islands is a total demolition. In 2024 and 2025, there were whispers of a new development group eyeing the land for a "mixed-use" luxury project. This would likely involve a smaller, more high-end hotel paired with private residences or villas. This is the current trend in Caribbean development—fewer rooms, higher prices, and a focus on "wellness."
The era of the massive, 300+ room all-inclusive mega-resort might be over for this specific plot of land. The topography is just too difficult, and the costs of maintaining that much infrastructure in a hurricane zone are astronomical.
Actionable insights for your USVI trip
Stop looking for Sugar Bay. It isn't there. If you want that specific "Smith Bay" vibe, here is what you actually do:
- Book at Margaritaville or Point Pleasant: These are the closest operational neighbors. You’ll be in the same neighborhood and can use the same grocery stores and restaurants in Red Hook.
- Visit Lindquist Beach early: Since Sugar Bay isn't funneling hundreds of guests to the local beaches, Lindquist remains relatively quiet. Go at 9:00 AM on a weekday. It’s paradise.
- Take the Ferry to St. John: One of the perks of the Sugar Bay location was the proximity to the Red Hook ferry. Use that to your advantage. Spend a day at Trunk Bay or Maho Bay.
- Support local Red Hook businesses: Places like Duffy’s Love Shack or The Tap & Still relied on the resort crowd. They are still there and they are awesome.
- Watch the news for "Smith Bay Development": If you see a headline about a new project in Smith Bay, that’s the Sugar Bay site. But don't expect a hotel to be ready there until at least 2028 or later, given the pace of island construction.
The story of Sugar Bay is a cautionary tale about the intersection of luxury travel and nature's power. It was a beautiful place that served as the backdrop for thousands of honeymoons and family vacations. While the buildings might be crumbling, the view from that hillside hasn't changed a bit. It’s still one of the best views in the Caribbean—it’s just waiting for a new chapter to begin.
For now, treat the Sugar Bay Resort Virgin Islands as a piece of island history. It’s a landmark of what used to be, a monument to the resilience of the islands, and a reminder to always check the "last updated" date on your travel guides. The Virgin Islands are very much open for business, just not at this particular address. Focus your energy on the thriving spots in Charlotte Amalie and Red Hook that have fought their way back.