Keldur Development Area

Keldur will be an exciting, modern urban quarter and the future home to 13,000 residents and 8,000 jobs, focused on eco-friendly transportation and land-use around three transit stations.



Reykjavík is a unique city characterised by its mix of pristine nature and vibrant urban life. In developing the future capital area the focus is on sustainability, quality of life and international competitiveness. Installation a high-quality bus rapid system called Borgarlína will be a new spine in the public transport system and the backbone of urban development. A growing nation, the capital and surrounding municipalities have been no exception in the pressing need for housing in the past decade. Development of the Keldur Area is a major step in creating a contiguous urban fabric and accommodating future housing and businesses in Reykjavik.


Keldur development area, at around 115 hectare (284 acres) in size, is large and rife with opportunities, richly endowed by nature while also presenting interesting challenges. The development area is part of a corridor of dense, mixed use urban core that runs the length of Reykjavík, from its old city center to the eastern edge. The City of Reykjavík and Transport for the Capital Area PLC (TfCA), the owner of the development area, have been collaborating and preparing the development of Keldur since 2021.


International Competition for Keldur’s Urban Development


As part of a long term Transport Pact signed in 2019 the future development of Keldur Area is a key milestone in the design and development of a new bus rapid transit system for the capital area. Keldur quarter, a transit-oriented development, will be serviced by one of the main Borgarlína BRT routes, which will extend from the city center and the main commercial areas of Reykjavik through Keldur continuing to the eastern part of the capital area. Travel time with Borgarlína between Keldur and the old city center will be 20 minutes and the aim is for the Borgarlína service to start simultaneously with the delivery of the first 100 apartments.


Reykjavík City and TfCA initiated an open, international competition in early 2023 for the development of Keldur. The aim is to build an exciting, modern urban quarter, focused on eco-friendly transportation and land-use around three transit stations. The competition was designed to solicit quality proposals and an interdisciplinary team to tackle the task at hand: Building a development plan for the area.



Out of around forty submissions in stage 1, five teams were selected to further develop their ideas in stage 2. After careful consideration of an international panel of judges, Swedish architect studio FOJAB and Ramböll engineers, secured victory with a convincing proposal for an urban quarter with approximately 13,000 residents and 8,000 workplaces.


Crafting Keldur: A winning proposal by FOJAB, Sweden


The winning proposal draws inspiration from the existing landscape and buildings in the area to create a unique and attractive character. “The proposed development is based on the consistent application of urban blocks around a convincing and realistic Borgarlína route, with strategically located stations and urban centers. This approach uses the land well and allows flexibility in the distribution of density, while also allowing good permeability,” as was noted by the jury in their verdict.



The development maintains a dense human-scale of 3-5 floors with premium urban qualities for residents and visitors concentrated around the Borgarlína. The proposal is designed for in total 11,600 new inhabitants in scenario 1, up to 15,500 new inhabitants in scenario 2.


Mutual benefits and long-term thinking


The development area was previously owned by the state and the development project is a part of the Capital Area Transport Pact between the government of Iceland, City of Reykjavik and other municipalities of the Capital Region.


The transport pact has tasked TfCA, a public company incorporated by the state and the municipalities, with overseeing the development and sale of land at Keldur. All profits from the development and sale of the land will go entirely to funding a portfolio of transport infrastructure projects in the capital area, including the Borgarlina BRT system, in accordance with the transport pact. Therefore, securing the mutual benefit for all partners.



The City of Reykjavík and TfCA with the FOJAB team are currently embarking on the next phase of area development based on the winning proposal. In the immediate future, Crafting Keldur will undergo consultation with relevant stakeholders to develop a formal development plan and design guidelines in the next 18 months that form the basis for a local masterplan and detail plans.

The objective is to confirm the local master plan and first detail plans for the area in 2026 and start street and utility construction. As outlined in the Reykjavík City Housing Plan for 2024-2033, it is anticipated that the allocation of buildable plots for residential housing in Keldur will commence in 2028.


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Presentation at MIPIM 2024 – PDF