THE de Savary family have announced work will start this winter on the next phase of the regeneration of the Cary Arms at Babbacombe.
And they have revealed they are actively looking for another project in South Devon.
Seven months ago the boutique hotel, pub and three holiday cottages were opened by the international entrepreneur Peter de Savary (pictured above) after £9million worth of renovations.
Now his wife Lana, who is heading up the project, has given the go-ahead for plans for a garden room extension on the top terrace, and an extension of six luxury suites for the hotel expected to cost around £250,000.
The hotel already has planning permission for the extension at the back of the building which will be wooden buildings, matching its New England theme. An application will be submitted for the garden room.
And it is proposed to start work on the third phase, redevelopment of the Babbacombe Beach cafe with further holiday apartments, next winter.
The Inn on the Beach project director Ian Solkin confirmed they were looking for other projects in the area.
"We have our eyes open at the moment and are actively looking for a property. We haven't found anything at the moment but we are very keen to see if we can do something else whether in the Bay or Devon. If we can do something similar to the Cary Arms that would be brilliant, particularly on a waterside site.
"The de Savarys are not interested in doing anything that doesn't reach a good standard."
Mr Solkin said they had had an excellent summer at the Cary Arms.
"It has exceeded our expectations and we are ahead of where we wanted to be after the first six months which is excellent. The rooms really took off in July and August, September was really strong and October is looking good," he said.
"Our performance so far has given us great confidence to do the next phase."
He said they could get some 30 covers in the garden room which would give them more flexibility, for example for bookings for large groups.
"The weather hasn't been a problem," he said. "Having worked on Dartmoor, we know about really bad weather. We have had the odd day this summer, but not weeks and weeks of rain. But the garden room will be a great space where people can feel they are outdoors but be indoors."
They hope to get both developments completed by next season, he said.
"We are forging ahead, but it was sensible to phase the work. I think it is a good opportunity for people to see what we do and have confidence in it. "
During the first summer the Cary Arms has received widespread publicity with journalists visiting the inn including Vogue, the Times and the Telegraph.
The hotel has already received five-star ratings from both the AA and Visit Britain and last week it received a bronze rating from Taste of the West for the quality of its food as a Devon gastro pub.
It is also a finalist in the Devon Life awards in the best newcomer category.