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Harpa Lost 669 Million in 2016

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Harpa Lost 669 Million in 2016

Reykjavík landmark Harpa Concert Hall and Conference Centre lost ISK 664 million last year (USD 6.3 million/EUR 5.3 million), Kjarninn reports. Its profits have lowered by about ISK 129 million (USD 1.2 million/EUR 1 million) between years. Despite these figures, the board and management of Harpa consider its financial situation better than in previous years.

The source of the figures is a report released by Harpa. “As our yearly report for the year 2016 shows, the total loss amounted to around 670 million krónur. This is a huge disappointment and corresponds in several ways to the parent company, including high rental costs, high operating costs of the building, and excessively high real estate tax,” stated Guðfinna Bjarnardóttir, deputy chairman of the board.

The annual financial report shows that operating profits have increased by 21 percent. Rental income from concerts, festivals, conferences, and other events make up a large part of those profits, increasing by about ISK 180 million (USD 1.7 million/EUR 1.4 million) to a total of ISK 778 million (USD 7.3 million/EUR 6.1 million) in 2016. Of this income, about 25 percent came from conferences, 19 percent from art events, and 14 percent from permanent tenants such as the Iceland Symphony Orchestra and Icelandic Opera.

Though Harpa’s gross profits have increased, its operating, property, and labour costs have also risen. One controversial issue regarding its finances has been how to evaluate Harpa’s property tax. Harpa’s report states that the National Register will re-evaluate the real estate value of Harpa for the year 2016, which could lead to a reduction in its real estate tax by as much as 50 percent.

The property is valued at more than ISK 20 billion (USD 188 million/EUR 157 million). The report points to Harpa’s high economic value arising from cultural activities which generate earnings in foreign currency for the national economy.

Guðfinna S. Bjarnadóttir, Ásta Möller and Kjartan Örn Ólafsson have since resigned from the board of Harpa. A new board has been elected including Arna Schram, Árni Geir Pálsson, Birna Hafstein, Vilhjálmur Egilsson and Þórður Sverrisson, who takes over as chairman of the board.

The Icelandic state holds a 54 percent stake in Harpa, and the city of Reykjavík 46 percent.

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