Keldnaland plan counts on 50 billion krónur without a cost estimate
Monday 19th October 2026 on 16:16 in
Iceland
The updated capital-area transport agreement projects 50 billion krónur in revenue from selling development rights in Keldnaland, but the cost of preparing the land for sale has not been assessed and it is not clear who will pay, mbl.is reports.
The figures were given by Finance and Economic Affairs Minister Daði Már Kristófersson in response to a question from Independence Party MP Guðlaugur Þór Þórðarson about the obligations of Betri samgöngur, the company overseeing transport improvements. The response was based on information from the company.
Betri samgöngur has not committed to work in Keldnaland beyond planned investments in the Borgarlína route through the area, which are included in the transport agreement’s project plan.
Preparations for the development began in autumn 2021. A planning competition run by the company and Reykjavík City ended in autumn 2023, and a draft framework for the city’s master plan, along with development-plan proposals and supporting documents, was presented in summer 2025.
Work is under way on a final master-plan framework and preparations for the first detailed plans, as well as timed plans for basic infrastructure. However, a formal plan for the whole Keldnaland development has not yet been presented for consideration, and detailed planning has not formally begun. Development is expected to proceed in smaller stages and continue well into the next decade.
Current draft plans allow for 5,800 homes, based on an estimated average size of 100 gross square metres. They also envisage commercial premises that could provide workplaces for 5,500 to 7,500 people. The final building volume, home sizes and number of homes will not be known until detailed plans for the entire area are approved, which is expected to take several years.
The minister’s response includes an example calculation that allocates 15 per cent of the projected 50 billion krónur in development-rights revenue to commercial property and 85 per cent to housing. With 5,800 homes, that would amount to about 7.5 million krónur per home, or 75,000 krónur per square metre.
For comparison, recent tenders by Garðabær and Kópavogur for development rights on sites with detailed plans indicate payments of 120,000 to 140,000 krónur per square metre, equivalent to 12 million to 14 million krónur for a 100-square-metre home.