Chinese tycoon still trying for Iceland resort

PUBLISHED : Sunday, 18 August, 2013, 12:00am
UPDATED : Sunday, 18 August, 2013, 4:20am

A Chinese property tycoon who wants to build a resort in the Icelandic wilderness still hopes to clinch a deal with authorities in Reykjavik despite two failed attempts, his representative says.

Huang Nubo, founder of property firm Zhongkun Group, is negotiating a deal that would see municipalities in northeastern Iceland buy the land and lease it to him, said his Icelandic representative Halldor Johannsson.

Huang's latest bid comes after Iceland in 2011 denied his request to buy 30,000 hectares of a wilderness area known as Grimsstadir a Fjoellum, citing foreign-ownership laws. He planned to build a tourist resort and create Europe's biggest nature reserve, a US$200-million investment.

A request last year to lease a much smaller plot was left dangling, until a new centre-right government in Iceland said it would look more favourably on foreign investments.

Now Huang's company has developed a business model in which an Icelandic firm called Zhongkun Grimsstadir, which is owned by Beijing Zhongkun, would rent about 1 per cent of the land in the Grimsstadir wilderness area as well as some 2,000 hectares of other land that is currently for sale, Johannsson said.

"We have had very good co-operation with the municipalities in northeast Iceland," he said. "Ownership of the land now for sale will … be in an Icelandic company, owned by the municipalities in the area.

"Everything will be done in accordance with Icelandic laws and regulations.

"The present government has emphasised economic growth and prosperity in its policies. We think that our plans go well with that emphasis."

Under Icelandic law, foreigners who own more than 20 per cent in an Icelandic company cannot lease land for more than three years at a time unless the agreement can be terminated within a year. Huang is seeking an exemption on that clause.

Icelandic Interior Minister Hanna Birna Kristjansdottir told public service radio RUV on Thursday that her ministry was carefully studying the request but that no decisions were expected in the near future.