Reykjavík City Buys Old Houses on Laugavegur Skip to content

Reykjavík City Buys Old Houses on Laugavegur

The City of Reykjavík reached an agreement on a bill of sale with Kaupangur regarding the old houses on Laugavegur 4 to 6 on Friday. The city plans to renovate the houses and preserve the old street image on Reykjavík’s main shopping street.

The cost has been estimated ISK 550 million (USD 8.4 million, EUR 4.7 million), though the exact purchasing price will not be released until after the next meeting at Reykjavík City Council, 24 Stundir reports.

Kaupangur purchased the houses a year ago with the goal of demolishing them and constructing a four-story hotel and shopping center for ISK 250 million (USD 3.8 million, EUR 2.6 million).

The case is now out of the hands of Minister of Education Thorgerdur Katrín Gunnarsdóttir. The House Preservation Committee has withdrawn its preservation proposal, but will work closely with Reykjavík City on renovating the buildings.

“I suspect that the secrecy surrounding this purchase indicates that the price is considerably higher than what was discussed in the city council yesterday [Thursday],” said Óskar Bergsson, a Progressive Party representative in Reykjavík City Council.

“It seems to me that the trade-off the city has to pay will be about ISK half a billion,” Bergsson added, referring to the real estate price, the renovation cost and the market value of the houses once the renovation is completed.

“We in the former majority had already requested an estimate on the purchase of the houses and their renovation and Vilhjálmur [Th. Vilhjálmsson, former mayor] and Ólafur [F. Magnússon, current mayor] didn’t even look at it before they ran off to buy the houses,” Bergsson claimed.

The estimate was undertaken by VST Consulting Engineers, who concluded that the city had to be prepared to invest ISK 389 million (USD 6.0 million, EUR 4.1 million) on reconstructing the houses on Laugavegur 4 to 6 if they decided to follow the proposal of house preservation society Torfusamtökin.

According to a statement issued by Reykjavík City, the city plans not only to renovate the old buildings on Laugavegur and preserve the 19th century street image, but also to create spaces that could facilitate various trade and service outlets.

The city plans to sell the real estate once renovation is completed.

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