The Retreat at Blue Lagoon by Design Group Italia

The Retreat at Blue Lagoon is a beautiful hotel located in Grindavik, Iceland, designed in 2019 by Design Group Italia.

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The Retreat at Blue Lagoon Iceland is designed for an intimate, revitalizing dialogue between the natural and the manmade.

With Blue Lagoon now welcoming more than one million guests annually, the company wanted to create a more intimate, more exclusive way to experience the lagoon’s unique waters. The newly opened Retreat represents the fulfillment of this ambition. Nature, architecture, and design converge to bring forth a new world of wellbeing.

Built directly into an 800-year-old lava flow in the heart of the Reykjanes UNESCO Global Geopark, the Retreat encompasses a subterranean spa, geothermal lagoon, a restaurant that reimagines Iceland’s culinary traditions, and a 62-suite luxury hotel encircled by the Blue Lagoon’s mineral-rich waters.

The architecture of the Retreat is by Reykjavík-based Basalt Architects. Milan-based Design Group Italia (DGI) created the experiential design. And the interior design was a collaborative effort between them.

Ultimately, the Retreat’s architecture and design harmonize with the otherworldly volcanic surroundings, erasing the boundary between man and nature. The result is a destination where the seamless interplay of lava, moss, and water is woven into every facet of the guest journey.


Improvisation and unity with nature

Barely visible from a distance, the Retreat is unified with its surroundings. As one gets closer, the structure distinguishes itself, taking form and shape while preserving harmony with the enchanting moss-covered horizon. Lava forms the walls and covers the roofs while the mineral-rich waters of the Blue Lagoon flow through and encircle the complex, creating the sensation that the Retreat is simultaneously fused to the land while anchored the geothermal warmth.

During the planning phases, the team from Basalt Architects spent many hours exploring the site, studying the earth and letting cracks and fissures reveal and guide how to best lay out the complex. But as the earthwork began, interesting lava formations were encountered, compelling the architects to revise their plans in order to incorporate these unexpected geological features, as they would become interior walls of the building. This made for a process that was antithetical to the typical mode of working, where changes during construction are generally undesired. In short, improvisation was fundamental to the Retreat’s unique evolution.

“When working on a project in such a delicate, unique environment, it is imperative that everyone involved has respect for the site, limitless ambition, and a sense of awe for their subject,” says Hrólfur Cela of Basalt Architects. “We’re thankful that the team at Blue Lagoon shared this vision and embraced this unconventional process.”

The Suites

Surrounded by water in the same way that a moat surrounds a castle, the suites at the Retreat are both within the lava and above the lava, straddling the divide between water, earth, moss, and sky.

Sigurður Thorsteinsson, Chief Creative Officer of Design Group Italia says: “The water gives this feeling of being an island in the middle of a lava field.”

The suites, ranging in size from 40 sqm to 200 sqm, are essentially one-sided. The spa experience is extended into each room with freestanding baths and showers with a view. Each suite’s floor-to-ceiling window creates an extraordinary perspective on the surrounding lagoon and the olcanic horizon—a landscape that transforms with the ever-changing angle and intensity of Iceland’s natural light.

Moss Restaurant

Occupying the highest point at Blue Lagoon Iceland, Moss Restaurant features stunning vistas of the centuries-old, moss-covered lava fields and mount Þorbjörn as a backdrop. The atmosphere is warm, with the design incorporating a chef’s table hewn from lava quarried onsite, a large-scale luminaire with 106 individually controllable OLED panels, and special editions of previously unavailable furniture by 20th century Icelandic designers. The restaurant also features a wine cellar built deep underground, with lava walls colored red by the natural process of oxidation that occurred 800 years ago when lava flowed molten across the Reykjanes Peninsula.

The Spa

Covering more than 4000 square meters and descending three meters into the volcanic earth, the Retreat Spa opens new dimensions of tranquility and transformation, giving guests the ability to commune with the natural wonders of geothermal seawater in an exclusive, sublime environment.

As guests move deeper into the earth, natural light fades while the temperature gradually rises. Transiting through underground realms of inspiring design, enchanting geology, and radiant wellness, the spa journey culminates with the Blue Lagoon Ritual—an exhilarating cycle of wellbeing where guests experience geothermal seawater’s trinity of nourishing elements in three interconnected spaces.
At the journey’s end, guests emerge from the earth and into the shimmering waters of the Blue Lagoon—a movement that consummates the connection between the origins and evolution of Blue Lagoon Iceland. Likewise, the guest experience of the water evokes Iceland’s centuries-old bathing culture. Teeming with natural and manmade mineral hot springs and reservoirs, Iceland is a place where communing with the purifying, healing, rejuvenating bounty of the geothermal earth is ingrained in the national psyche. Transposed to the Retreat, this act becomes a uniquely luxurious manifestation of an ancient practice.


The Retreat is predominantly made of concrete, much of it precast to reduce the environmental stress of onsite construction. The color and composition of the concrete varies from textured off-white in the lobby to smooth, dark grey in the depths of the spa, echoing the bare lava walls. Throughout the complex, perforated facades and interior screens evoke the natural patterns that emerge when the air pockets locked inside lava rocks are revealed. In truth, an actual piece of lava was used as the basis for this exuberant matrix of volcanic shapes. As for the flooring, terrazzo floors were created using local sand and stone, resulting in a dark grey, beautifully textured surface.

The active ingredients of the Blue Lagoon are silica, blue-green algae, and mineral salt. While the efficacy of these elements for skin care and wellbeing has been confirmed through decades of research, they prove quite difficult for many traditional building components. Likewise, the local weather conditions—characterized by powerful winds, horizontal rains, and storms of snow and ice—ferociously inform what materials are suitable. Designers must therefore be acutely aware of these conditions to ensure the longevity and sustainability of the buildings.


Harmony, contrast, and wellbeing

The Retreat was envisioned as a home away home on an island at the edge of the Arctic Circle, a place where guests can disengage from their saturated everyday lives and feel connected to nature. It offers a soothing, calming, sophisticated atmosphere. And the earth’s endless geothermal warmth provides a striking contrast to the cold, often unforgiving environment just beyond the windows. Staring outside, guests should feel absolute comfort—a sense of being cocooned in a structure fused to the volcanic frontier.

Inspired by the landscape, the interiors feature tone-to-tone colors, simple shapes, and extreme attention to detail, creating an atmosphere of refined luxury.

Warm walnut woods are juxtaposed with various concrete, rock, and lava surfaces to establish an authentic, inviting atmosphere. The subtle profusion of raw, tactile, and natural materials, orchestrated in a simple, linear style, produces a realm of deep comfort.

The color palette governing all chromatic design decisions was meticulously chosen for the manner that it highlights and echoes the volcanic vista, conjuring harmony with the water, land, weather, and light: the whiteness of salt, silica, and snow; the blacks, grays, and oxidized reds of lava; the blues of geothermal seawater; and the browns and greens of the moss and other fauna.

Here and there, the interiors feature twists, unexpected details that enliven the space, provoking wonder and establishing a connection to contemporary movements. The resulting style is timeless and sophisticated—a previously unseen incarnation of Icelandic luxury rooted in the celebrated tradition of Scandinavian design yet infused with Italian quality craftsmanship and attention to detail.

Furniture and product design

The Retreat is primarily furnished with pieces by B&B Italia. Founded in 1966 by Piero Ambrogio Busnelli, B&B Italia is one of the world’s leading design furnishings companies. The Retreat features both B&B Italia design classics and an extensive number of bespoke pieces designed exclusively for the Retreat by Design Group Italia.

Honoring the heritage of Icelandic design, DGI also created special editions of furniture that had not been available for decades, thereby exhuming and reinvigorating hidden treasures in the history of Scandinavian design. The project was orchestrated by Blue Lagoon in collaboration with the Icelandic Museum of Design and Applied Arts. The re-editions include celebrated pieces by Sveinn Kjarval, Þorkell G. Guðmundsson, Gunnar H. Guðmundsson, Guðmundur Benediktsson, and Jón Benediktsson.

Material in focus: Lava

The Retreat is built directly into the 800-year-old lava flow at Svartsengi. Accordingly, lava stone has been integrated into various design elements. Some examples:

– Custom faucets by Axor of German sanitary fittings manufacturer Hans Grohe
– Artist Ragna Robertsdóttir uses lava from the Reykjanes Peninsula to create custom-made art pieces for the Retreat
– Each custom-made lava rock table—designed by DGI—features a lava stone in a metal setting as a table top ‘gem’
– The chef’s table is made from a giant piece of custom-cut lava rock that was queried onsite during the construction process
– Certain B&B tables feature lava stone detailing
– Lava is the foundation of the Retreat’s color palette
– Fireplaces of lava rock masonry


The Retreat’s lighting—designed by Reykjavík-based Liska in collaboration with Italy-based iGuzzini—was conceived to preserve the enchantments of Iceland’s natural light while creating artificial light that is nourishing, relaxing, functional, engaging, and sustainable. This is an approach to lighting design called human centric lighting.

The foremost example of human centric lighting is the innovative luminaire that serves as the central light fixture in each suite. Encompassing the light spectrum of dawn to dusk, the luminaire modulates through the phases of the sun—fulfilling the human biological need for light. In a land where darkness predominates for much of the year, nourishing radiance is an essential aspect of wellbeing.

Icelandic ceramics

Portions of a 1600-piece ceramics collection from the Icelandic Museum of Design & Applied Art will be exhibited in the lobby of the Retreat. The assemblage—a comprehensive body of Icelandic ceramics dating back to the 1930s—was purchased by the museum with a grant from Blue Lagoon and encompasses works by preeminent Icelandic artists including Ragnar Kjartansson, Kogga, Dieter Roth, Steinunn Marteinsdóttir, and Guðmund frá Miðdal.

The first subset of the collection to be exhibited consists of 50 pieces from the 1960s and 70s—a period characterized by the technique of fastening lava to clay and then firing and glazing the object. Named for the Reykjavík pottery studio that popularized this method—Glit—these objects tell the story of a unique moment in Icelandic clay art.

Guests need only look out the window to make the connection between glit ceramics and the Retreat’s surrounding terrain.

Art by Ragna Róbertsdóttir

Renowned Icelandic artist Ragna Róbertsdóttir created a lava-based wall installation for Moss Restaurant, as well as salt-based topographical “mindscapes” for the Moss and Lagoon suites at the Retreat Hotel.

Inspired by Iceland’s volcanic, tectonic, and oceanic provenance, Róbertsdóttir’s work often blurs the distinction between nature and architecture, with chaos giving way to contemplation. Rocks, seashells, salt—these are the materials that catalyze her imagination and form the basis of her visual lexicon.


The dynamic, sustainable relationship between man and nature is the cornerstone of Blue Lagoon’s philosophy. This relationship informs every aspect of the Retreat experience. From the healing water that fills the lagoon to the electricity that lights the complex, every coordinate of the visitor journey draws its power from the earth’s geothermal resources. In short, wellness at the Retreat is inseparable from the wellspring of renewable energy brought forth at the Svartsengi Resource Park.

Photography courtesy of Design Group Italia

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- by Matt Watts