The former American embassy building in Reykjavik is set for significant changes as plans emerge to demolish its extensions, transitioning the space towards residential housing. The American embassy operated from the location on Laufásvegur since 1942 but relocated its operations to a new site in 2014. Following the move, the building was briefly used to shelter eighty refugees before it came under the ownership of Mannverk ehf., which intends to propose alterations to the zoning plan for the property.

Mannverk ehf. is seeking approval for a new zoning plan which includes demolishing the extensions of the existing embassy building and constructing new residential units in its place. This proposal was discussed at a recent meeting of the environmental and planning council. The focus is on integrating new residential construction into a historically significant location while addressing the ongoing housing demand in Reykjavik.

If the proposal receives approval, it could signal a shift in the utilization of former governmental properties in Iceland towards residential purposes, reflecting a broader trend of urban redevelopment in response to population growth and housing shortages. Moreover, the transformation of the former embassy site may carry implications for local architecture and the preservation of Reykjavik's historical narrative amidst modern development.