100 billion ISK development at the terminal

The estimated amount of construction at the Keflavík Airport terminal 2021 to 2028 is equivalent to one Smáralind mall, says Sveinbjörn Indriðason, CEO of Isavia, in an interview with Viðskiptablaðið business weekly.


In the interview, Isavia CEO Sveinbjörn Indriðason says the development that has begun at Keflavík Airport is long overdue, as it has been known that there was a need to improve the terminal's capacity.

"The structural need is twofold. On the one hand, it relates to capacity in the terminal itself, and that is where we now find the biggest bottleneck. However, the need relates to the runway system which is not a bottleneck at the moment,” he explains. For this reason, it was decided to prioritize the development in such a way as to make every effort to increase the terminal's capacity.

Before the outbreak, there was going to be a very large construction work on the connecting building between the northern and southern parts of the terminal. At the same time, preparations began for the so-called eastern wing, which is a being built next to the terminal facing Reykjanesbær, on the outside of which land bridges line up. "However, when the epidemic hit, we sat down and divided this project into two parts, to reduce the risk involved in construction. The support structure that has already been erected to the east of the terminal is the first part of the project, which will be completed in the fall of 2024. Following that, we will begin to remove the red connection area between the terminal buildings and build a large structure in the middle. That probably won't come into use until 2028," says Sveinbjörn.

A development like this is obviously far from being cheap. Sveinbjörn says that the airport development plan assumes that Isavia will invest more than ISK 100 billion in the development of the airport over the next 10 years.

Sveinbjörn says that Isavia's financial strength was so great before the epidemic that the company could have survived the epidemic without needing additional capital. "But then, on the other hand, we would not have been able to prepare for construction and bring them to the design and later implementation stage as we have done today. Construction would therefore have been delayed by two to three years. The decision of the Minister of Finance to increase Isavia's share capital during the epidemic was vital, to be able to start immediately."

Here you can find the interview with Sveinbjörn in its entirety, on the website of Viðskiptablaðið business weekly.