Government has chosen a site for the new hospital and environmentalists are likely to be upset.

The Bermuda Sun understands Cabinet has decided build a new hospital at the Botanical Gardens in Paget because it's the most cost-effective of three proposals it has been mulling over for more than a year.

The decision is likely to prompt questions about the extent of Government's commitment to its own sustainable development strategy, which is currently being discussed at a series of public meetings, because the new KEMH will eat into green space.

But the cost benefit is said to have outweighed concerns over the loss of green space. It is believed that the old KEMH site will be converted into green space that will be incorporated into the Botanical Gardens after the new hospital is built.

Yesterday, no one in Government was willing to confirm the Botanical Gardens location, but it is expected to be announced at a press conference that has been scheduled for Thursday.

The decision comes more than a year after the Bermuda Hospitals Board unveiled a raft of "preliminary proposals" to restructure the island's health-care facilities.

U.S. design firm Cannon Design, hired by theBermuda Hospitals Board, said both KEMH and psychiatric hospital Mid-Atlantic Wellness Institute would have to be replaced by 2012.

Cannon Design came up with three proposals: build a new hospital on the existing site, the most costly option, or at the Botanical Gardens, in Paget, or the Arboretum in Devonshire.

The Botanical Gardens is certain to be the more practical of the two green space options because of its location - it's next door to the hospital and was once part of the same Camden Estate property.

Ronald McIntyre, of Cannon Design, conceded the challenges Bermuda faces in coming up with a new site.

He had said: "Bermuda is not like other jurisdictions. We were asked to look at a broad range of site options. It's complicated because you don't have a lot of large areas of available land that are centrally located. All the sites have advantages and they all have disadvantages."

Because the Arboretum and Botanical Gardens proposals would gobble up as much as a third of the parks' green space, a commodity that is rapidly disappearing in Bermuda, environmentalists immediately raised the red flag.

At the time the Botanical Gardens was first floated, Stuart Smith of Save Our Open Space said he was "flabbergasted" and Andrew Dobson, then president of the Bermuda Audubon Society, expressed surprise.

Environmentalist and Bermuda Sun columnist Stuart Hayward said last year: "I'm not unsympathetic to what the hospital faces but open space in Bermuda doesn't get the protection it needs.

"The community will be justified in resisting any construction on open space. The concept of having bricks and mortar on parkland is unacceptable."

Steve Conway, director of the Bermuda National Trust, said at the time: "At this stage it is scary that these parks are being considered as a valid option by the BHB and that Bermuda's parks now serve as the only choice for new development -since most of Bermuda's developable land has been used up."

Plans were presented to the public last year at a series of meetings although a business plan for financing the cost, which was being developed by accounting firm PricewaterhouseCoopers, has yet to be made public. The Bermuda Hospitals Charitable Trust will be in charge of fund-raising.