Kollafjørður land deal could cost Tórshavn over 6.5 million kroner

Tórshavn Municipality could pay more than 6.5 million kroner for land and compensation linked to planned housing and a community area in Norðreki, a part of Kollafjørður. The figures come from public council documents and records obtained by KVF.

The total comprises 3,450,458 kroner for 29,217 square metres of state-owned land and a proposed 3,063,633 kroner in compensation for Gunnvør Dam Jensen, the leaseholder of a farm in the area. It is not clear whether either amount has received final approval or been paid.

On 19 December 2023, the municipality signed an agreement in principle with Jensen to acquire about 29,000 square metres of her leased land for housing and a community area. The agreement also provided for compensation for a new sheep shed, as the development would affect the farm’s operations. The council unanimously backed the agreement, with changes, in January 2024.

The municipality received preliminary approval from Búnaðarstovan in October 2024 to buy the state-owned land for 3,450,458 kroner. A council document from December that year said the agreement with Jensen also covered the cost of a new sheep shed, though its price was then unknown.

A proposed settlement this year would pay Jensen 1,063,633 kroner for lost feed units and two million kroner for the sheep shed. Búnaðarstovan estimated the annual operating loss from the land at just over 106,000 kroner; the proposed compensation for lost feed units is ten times that estimate.

The proposed settlement is subject to approval by the municipality’s finance committee. The documents do not show whether it has been signed or whether any payment has been made. The land purchase and the proposed compensation are separate transactions: the municipality would buy the state-owned land through Búnaðarstovan, while the compensation relates to losses suffered by the farm leaseholder.

A separate agreement to lease land beneath a road in Norðreki has also been discussed. In December 2025, the municipality’s lawyer said the council had not approved it. Its final status and any additional financial implications remain unclear.

The land has also featured in plans for a new care centre in Kollafjørður, which was initially intended for Todnes. On 8 June, councillor Bergur Robert Dam Jensen, the leaseholder’s son, asked the municipal manager to bring forward a proposal to move the centre to Norðreki. He said a preliminary assessment suggested Todnes was too small and called for a similar assessment of Norðreki.

The council approved the proposed move by seven votes to six on 17 September. The mayor, Elsa Berg, halted the matter the following day. On 25 September, Heidi Lava Elgeirsdóttir asked the municipal oversight authority to review whether Bergur Robert Dam Jensen had a conflict of interest. He denies being disqualified and said on 9 October that he would complain about the mayor’s decision to halt the council resolution.