€937m public-private partnership to modernise Danish military accommodation

Danish contractor MT Højgaard Denmark and pension fund PensionDanmark have signed a 20-year contract to construct new accommodation for soldiers.

Construction of 31 buildings will begin in April as part of a major modernisation programme addressing long-standing underinvestment in Danish Armed Forces facilities.

The contract spans 20 years and has a total value of €937 million. 

It is the second public–private partnership (PPP) agreement the two partners have signed with the Danish Defence. The first covered the construction of a new headquarters for the Defence Intelligence Service in Copenhagen.

- It is a very large assignment when you look at the total contract value, says Carsten Nielsen, Head of Construction and Civil Engineering at MT Højgaard Denmark, speaking to Licitationen, a Danish affiliate of Defence Nordic.

Under the agreement, MT Højgaard Denmark will construct 31 buildings comprising around 1,600 rooms across 11 locations nationwide, and will also operate the facilities for a period of 20 years.

Operations will be managed by the subsidiary Raunstrup. For the group as a whole, the contract has a total value of 348 mio. euros

- The complexity of the construction itself is not particularly high, but the volume is significant and it must be delivered quickly, Nielsen says.

From the outset, the Danish Defence has set a demanding construction schedule for approximately 100,000 square metres, with further expansion expected.

At the same time, many existing barracks at bases across the country are suffering from decades of underfunding.

In addition, Danish politicians have decided to extend conscription to both men and women and to increase the period of service from four to eleven months, significantly increasing the demand for accommodation.