House prices could rise as a knock-on effect of Bermuda Cement Company (BCC) moving to a new site at Dockyard, it was warned this week.

BCC director Stella Winstanley revealed that the company had been given planning permission to build a new storage and distribution centre about 400 hundred yards from its present site.

The move would cost the firm millions of dollars and would inevitably cause the price of cement to rise, affecting the entire construction industry and new housing market.

Ms Winstanley said BCC — the Island's only bulk cement supplier — would prefer to continue to use the two silos already in place on Freeport Drive, which have a life expectancy of another 40 years.

But the company has been told by its landlord, the West End Development Corporation (Wedco), that its current 22,000 square foot site is earmarked for other uses.

Ms Winstanley said: "If we move, we have to create a storage facility. It's not inexpensive to create that. It would cost millions."

She said the expense could force BCC to increase the price of cement. Asked if that could cause house prices to rise, she said: "I would think so."

A source in the industry told The Royal Gazette that the move could be disastrous for builders and house-buyers alike. "Cement is literally the glue that holds construction together. You add water, you add sand, and off you go. It's a critical component.

"For them to have to replace two silos is a major capital investment. No one has yet revealed the effect them moving will have on the cost of cement. It could push house prices up by quite a lot. Can we afford that? To the average person who's got a dream of building a house here, it makes it a whole lot harder."

Alex DeCouto, president of the Construction Association of Bermuda, said: "Any price movement in cement would trickle down to the construction industry and prices for the consumer. In that sense, I'd be concerned about that."

He added: "It's just being able to count on a regular supply (of cement) that's probably the more critical issue. If there is a snag in negotiations (between BCC and Wedco) and that leads to a break in supply that's a much bigger problem."

The planning approval for BCC is the latest in a long-running wrangle between the company and Wedco. The former wants a 20-year lease for the new site but Wedco has previously said it would only allow a ten-year deal.

Ms Winstanley said on Thursday: "They have advised that they expect to give us an answer regarding a lease by the end of this month."

Wedco chairman Stanley Lee would not comment on the potential cement price rise. But he said the corporation did have plans for the existing BCC site, which was why the old silos would not be able to be used. "We have plans for the whole Dockyard area actually, (for) redevelopment," he added.