Chinese Investor to Build Hotel on Remote Icelandic Land

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Chinese Investor to Build Hotel on Remote Icelandic Land

Huang Nubo, chairman of the Chinese investment company Zhongkun Group, and the owners of the land Grímsstadir á Fjöllum in the remote northeastern Icelandic region, where a farm and guesthouse stand, signed an acquisition agreement yesterday.

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Jökulsárgljúfur, one of the biggest attractions in the vicinity. Photo by Páll Stefánsson.

Zhongkun Group is planning the construction of a five-star hotel, an 18-hole golf course and facilities for horseback riding at Grímsstadir and the development of environmental tourism in the area; the company has also been involved in such developments in China and the US, Morgunbladid reports.

The total investment at Grímsstadir á Fjöllum is worth ISK 10-20 billion (USD 87-175 million, EUR 61-121 million) and developments could take around three years.

However, the agreement is dependent on the approval of both Chinese and Icelandic authorities; the Icelandic state owns part of the land.

Huang met Icelandic Minister for Foreign Affairs Össur Skarphédinsson yesterday to discuss his company’s intentions in Iceland; he is also interested in running a hotel in Reykjavík, as stated in a press release from the ministry.

According to Morgunbladid, the five-star hotel in the capital would also be the company's headquarters in Iceland.

In northeast Iceland, the investor is keen on connecting the main area of Vatnajökull National Park with the land of the park’s territory around the gorges Jökulsárgljúfur in cooperation with Icelandic authorities, which would fit the company’s policy on the protection of nature and environmental tourism.

The company is also prepared to give up the water rights to the glacial river Jökulsá á Fjöllum which runs through the 30,000-hectare land.

Skarphédinsson said he welcomes foreign investment and development of the Icelandic tourist industry, especially outside the capital region, mentioning that the municipality in question, Nordurthing, is content with the company’s plans.

Bergur Elías Ágústsson, director of Nordurthing, told Morgunbladid that the local council and Huang signed a declaration of intent on Monday on cooperation on the development of tourism in the region; Zhongkun Group’s project suits Nordurthing’s policy well, he said.

However, each project must be looked into closely in consultation with everyone involved, Skarphédinsson remarked, which the Icelandic government is prepared to do.

Grímsstadir á Fjöllum is divided into Grímsstadir I, which is privately owned, and Grímsstadir II, which is owned by the state and accounts for 25-30 percent of the land.

Click here to read reports from 2009 of a Chinese aluminum company expressing interest in buying energy in northeast Iceland.

ESA