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Development of Residential and Administrative Buildings and Road Infrastructure at the 'Sēlija' Training Area, and Ammunition Storage Facilities in Nīkrāce

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This project is the second large-scale public–private partnership (PPP) project in Latvia implemented by the State Joint Stock Company “State Real Estate” (SRE) under a delegation from the Ministry of Defence. The project is focused on the development of defence infrastructure, with the National Armed Forces (NAF) as the end user. 

The objective of the project is to ensure the construction and development of specific infrastructure facilities identified in the National Armed Forces’ long-term development plans for 2025–2036. The project is implemented within a public–private partnership framework, enabling the effective integration of public and private sector experience and expertise.

The PPP model provides for the delivery of modern, sustainable, and functionally appropriate infrastructure solutions that support the operational needs of the defence sector.

General Information

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Infrastructure

► The “Sēlija” training area –military base section covers a developable area of 163 hectares. The site includes a residential and administrative zone, a canteen, a medical center, auxiliary buildings, warehouses, parking areas, a sports hall and outdoor sports field, a checkpoint, fencing, as well as heating systems, water supply, and internal road infrastructure. A road network is being constructed within the training area, comprising 16 road sections with a total length of 140 km, including 23.5 km of two-way roads and 116.5 km of one-way roads, all designed for a load capacity of up to 70 tonnes. Additional infrastructure includes 9 bridges, 102 culverts, and 40 access ramps. ►Nīkrāce: The developable area covers 629 hectares. The site includes warehouses, hangars, administrative buildings, auxiliary structures, access roads, and utility connections.

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Location

► Training Area “Sēlija” – located within the territories of Aizkraukle and Jēkabpils municipalities. ►Warehouses in Nīkrāce – located in Kuldīga Municipality.

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Capital Investments

► Training Area “Sēlija”: EUR 303 million (military base EUR 228 million and road network EUR 75 million). ►Warehouse complex in Nīkrāce: EUR 100 million. ►Total capital investments: EUR 403 million (estimate).


ⓘ    Industrial security certification will be required for the private partner at specific sites.
 

Project implementation

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PPP Model

Design, Build, Finance, Maintain

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Payment Method

Availability payments

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Public Partner

SRE

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Procurement Method

In preparation

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Procurement Process

In preparation

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Market Consultation

Q1 2026

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Qualification Stage

Q4 2026 (indicative)

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Availability Period

Up to 30 years (more precise calculations are being prepared)

Document Development
Private Partner Selection
Contract Signing with the Private Partner
Construction Works
Completion of Construction
First Availability Payment
2026
2027
2028
2028/30
2029/30
2030
Document Development
2026
Private Partner Selection
2027
Contract Signing with the Private Partner
2028
Construction Works
2028/30
Completion of Construction
2029/30
First Availability Payment
2030

Benefits for Investors and Partners

National Security

Participation in the project offers investors the opportunity to engage in a nationally strategic and large-scale initiative aimed at strengthening Latvia’s and NATO allies’ defense capabilities.

Projected Revenues

A long-term contract of up to 30 years ensures a stable cash flow.

Strategic Value

Opportunity to gain experience in a large-scale and nationally significant security infrastructure project.

Risk Sharing

Clearly defined roles and a stable public partner, with Latvia recognized as a reliable partner with a strong credit rating.

Role of State Real Estate (SRE) in the Project

Implementation

SRE manages the PPP project from the initial preparation of documentation through full contract execution, including the end of the availability payment period, ensuring strategic and operational management of the process and safeguarding the interests of all parties.

Monitoring

Collaboration with the private partner throughout the 30-year availability period, ensuring the quality of services.

Collaboration

Project management in close synergy with the Ministry of Defence (MoD), the European Investment Bank (EIB), and experts from the European PPP Expertise Centre (EPEC), representing the interests of the state.

Expertise

SRE has long-term and extensive experience in implementing large-scale and complex projects.
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Information updated: 23 December 2025

November 2025

Cooperation launched with a consulting company for the preparation of financial and economic calculations and procurement documentation.

October 2025

A cooperation agreement concluded between the state joint-stock company “State Real Estate” (Valsts nekustamie īpašumi) and the EPEC – PPP Expertise Centre of the European Investment Bank.

A Memorandum of Understanding signed between the European Investment Bank, the Ministry of Finance, the Ministry of Defence, and the state joint-stock company “State Real Estate”.

A delegation agreement concluded between the Ministry of Defence and the state joint-stock company “State Real Estate” for the implementation of the PPP project.

September 2025

A decision adopted to carry out financial and economic calculations in accordance with the decisions taken at the Cabinet of Ministers meeting of 23 September 2025.

At the Cabinet of Ministers meeting on 23 September 2025, a restricted-access informative report was reviewed, and decisions were taken supporting the implementation of the PPP framework for defence infrastructure construction.

The PPP implementation plan, timelines, and conditions were approved.

July – August 2025

A restricted-access informative report prepared.

June 2025

An assessment of priority defence infrastructure projects carried out, selecting the most suitable projects for implementation under the PPP framework in cooperation with international experts.

May 2025

On 13 May 2025, the Cabinet of Ministers decided on the need to identify priority projects for implementation under the PPP framework.

April 2025

The Ministry of Defence conducted consultations on the implementation of the PPP framework and carried out preliminary studies in cooperation with national and international experts.

The contracting authority for the PPP project is the Ministry of Defence (MoD). Information at the project’s initiation is available here: https://www.mod.gov.lv/en/ppp
The future user of the PPP facility will be the National Armed Forces (NAF). More information is available here: https://www.mil.lv/en

 

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