diff --git a/jps-plugin/src/org/jetbrains/kotlin/jps/build/JpsSourceFileToPathConverter.kt b/jps-plugin/src/org/jetbrains/kotlin/jps/build/JpsSourceFileToPathConverter.kt
new file mode 100644
index 00000000000..104a9147f7d
--- /dev/null
+++ b/jps-plugin/src/org/jetbrains/kotlin/jps/build/JpsSourceFileToPathConverter.kt
@@ -0,0 +1,36 @@
+/*
+ * Copyright 2010-2019 JetBrains s.r.o. Use of this source code is governed by the Apache 2.0 license
+ * that can be found in the license/LICENSE.txt file.
+ */
+
+package org.jetbrains.kotlin.jps.build
+
+import org.jetbrains.jps.model.JpsProject
+import org.jetbrains.jps.model.serialization.JpsModelSerializationDataService
+import org.jetbrains.kotlin.incremental.storage.SourceFileToPathConverter
+import java.io.File
+
+private const val PROJECT_DIR_PLACEHOLDER = "${'$'}PROJECT_DIR$"
+
+internal class JpsSourceFileToPathConverter(jpsProject: JpsProject) : SourceFileToPathConverter {
+    private val baseDirPath = JpsModelSerializationDataService
+        .getBaseDirectory(jpsProject)?.canonicalFile?.invariantSeparatorsPath
+
+    override fun toPath(file: File): String {
+        val path = file.canonicalFile.invariantSeparatorsPath
+        return when {
+            baseDirPath != null && path.startsWith(baseDirPath) ->
+                PROJECT_DIR_PLACEHOLDER + path.substring(baseDirPath.length)
+            else -> path
+        }
+    }
+
+    override fun toFile(path: String): File =
+        when {
+            path.startsWith(PROJECT_DIR_PLACEHOLDER) -> {
+                val basePath = baseDirPath ?: error("Could not get project root dir")
+                File(basePath + path.substring(PROJECT_DIR_PLACEHOLDER.length))
+            }
+            else -> File(path)
+        }
+}
\ No newline at end of file
diff --git a/jps-plugin/src/org/jetbrains/kotlin/jps/build/KotlinCompileContext.kt b/jps-plugin/src/org/jetbrains/kotlin/jps/build/KotlinCompileContext.kt
index 604ac019265..380517127b3 100644
--- a/jps-plugin/src/org/jetbrains/kotlin/jps/build/KotlinCompileContext.kt
+++ b/jps-plugin/src/org/jetbrains/kotlin/jps/build/KotlinCompileContext.kt
@@ -12,6 +12,7 @@ import org.jetbrains.jps.incremental.GlobalContextKey
 import org.jetbrains.jps.incremental.fs.CompilationRound
 import org.jetbrains.jps.incremental.messages.BuildMessage
 import org.jetbrains.jps.incremental.messages.CompilerMessage
+import org.jetbrains.jps.model.serialization.JpsModelSerializationDataService
 import org.jetbrains.kotlin.config.CompilerRunnerConstants
 import org.jetbrains.kotlin.incremental.LookupSymbol
 import org.jetbrains.kotlin.incremental.storage.SourceFileToCanonicalPathConverter
@@ -68,7 +69,8 @@ class KotlinCompileContext(val jpsContext: CompileContext) {
 
     val hasKotlinMarker = HasKotlinMarker(dataManager)
 
-    val sourceFileToPathConverter: SourceFileToPathConverter = SourceFileToCanonicalPathConverter
+    val sourceFileToPathConverter: SourceFileToPathConverter =
+        JpsSourceFileToPathConverter(jpsContext.projectDescriptor.project)
 
     val lookupStorageManager = JpsLookupStorageManager(dataManager, sourceFileToPathConverter)
 
diff --git a/jps-plugin/src/org/jetbrains/kotlin/jps/incremental/local.kt b/jps-plugin/src/org/jetbrains/kotlin/jps/incremental/local.kt
index 59eeffbcc9b..70bba8d67b9 100644
--- a/jps-plugin/src/org/jetbrains/kotlin/jps/incremental/local.kt
+++ b/jps-plugin/src/org/jetbrains/kotlin/jps/incremental/local.kt
@@ -7,7 +7,7 @@ package org.jetbrains.kotlin.jps.incremental
 
 import java.io.File
 
-private val NORMAL_VERSION = 11
+private val NORMAL_VERSION = 12
 private val NORMAL_VERSION_FILE_NAME = "format-version.txt"
 
 fun localCacheVersionManager(dataRoot: File, isCachesEnabled: Boolean) =
diff --git a/jps-plugin/src/org/jetbrains/kotlin/jps/incremental/lookups.kt b/jps-plugin/src/org/jetbrains/kotlin/jps/incremental/lookups.kt
index 8821c18afc2..8c2e26ab3e6 100644
--- a/jps-plugin/src/org/jetbrains/kotlin/jps/incremental/lookups.kt
+++ b/jps-plugin/src/org/jetbrains/kotlin/jps/incremental/lookups.kt
@@ -8,7 +8,7 @@ package org.jetbrains.kotlin.jps.incremental
 import java.io.File
 
 private val DATA_CONTAINER_VERSION_FILE_NAME = "data-container-format-version.txt"
-private val DATA_CONTAINER_VERSION = 4
+private val DATA_CONTAINER_VERSION = 5
 
 fun lookupsCacheVersionManager(dataRoot: File, isEnabled: Boolean) =
     CacheVersionManager(