Refugee Riches

Nor­way’s Adolf­sen broth­ers care for im­mi­grants, at a tidy profit

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It’s a scene that could pos­si­bly warm even the two-sizes-too-small heart of the Grinch. Here in a lit­tle vil­lage in Nor­way, as dusky mid­day light fil­ters in through the for­est out­side a class­room, a half­dozen Afghan teenagers hunch over a long wooden ta­ble, as­sid­u­ously scis­sor­ing col­ored sheets of con­struc­tion pa­per. Th­ese are 15- to 18-year-old boys who’ve en­dured mis­eries no child de­serves—gun­fire, ex­plo­sions, the killing of a par­ent by Is­lamic State—and they’ve trav­eled here from their home­land on foot and in suf­fo­cat­ingly crowded vans. They sneaked through the woods on the Tur­key-Bul­garia border, and they’ve been chased and bit­ten by po­lice dogs and beaten by their smug­glers. Now they’re cel­e­brat­ing Christ­mas and in­scrib­ing cards with some of the very first Nor­we­gian words they’ve learned: God Jul. Merry Christ­mas. Are they happy to be here? “It is calm and peace­ful,” says Bi­lal, 15, in Pashto. “It is nice,” says Ah­mad, also 15, “but why isn’t there a cricket pitch?”

Their mid­dle-aged teach­ers—a Syr­ian and an Eritrean, both one­time refugees them­selves—hover over them, benev­o­lent, smil­ing, as a com­muter train rat­tles in the dis­tance. This, ar­guably, is the Scan­di­navia that the self-pro­claimed so­cial­ist pres­i­den­tial can­di­date Bernie San­ders was re­fer­ring to in Oc­to­ber when he sug­gested that Amer­i­cans “should look to coun­tries like Den­mark, like Swe­den and Nor­way, and learn from what they have ac­com­plished”—par­tic­u­larly when it comes to gov­ern­ment pro­grams that as­sist those in need.

Ex­cept there’s this other guy in the room, stand­ing off to the side, al­most invisible as he han­dles in­com­ing e-mail on his smart­phone. Kris­tian Adolf­sen, 55, wears a V-neck sweater, a striped but­ton-down, and glasses. This is his first visit to this refugee cen­ter in Hval­stad, but he owns the op­er­a­tion with his brother, Roger, 51, and they run 90 such cen­ters in Nor­way and 10 more in Swe­den. Refugees rep­re­sent a huge op­por­tu­nity for them; the Adolf­sens’ Oslo-based com­pany, Hero Nor­way, is the leader of a bur­geon­ing Scan­di­na­vian in­dus­try that charges the Nor­we­gian and Swedish gov­ern­ments a fixed fee—$31 to $75 per per­son per night in Nor­way—to house and feed refugees.

In Nor­way, Hero op­er­ates sev­eral dif­fer­ent kinds of refugee lodg­ing, among them short-stay dor­mi­to­ries where asy­lum seek­ers sleep a few nights, wait­ing to be screened by po­lice af­ter cross­ing the border; a sec­ond pha­lanx of fa­cil­i­ties where refugees wait a couple of weeks to be in­ter­viewed by im­mi­gra­tion of­fi­cials, tak­ing their meals in a cafe­te­ria; and longer-term camps where they live more in­de­pen­dently, in de­tached houses, cook­ing their own meals, as they wait, of­ten for years, to be set­tled in Nor­way with pro­tected refugee sta­tus.

For 2015, Hero Nor­way expects rev­enue of $63 mil­lion, with prof­its of 3.5 per­cent. In the rest of Europe, where asy­lum seek­ers typ­i­cally are cared for by non­govern­men­tal or­ga­ni­za­tions such as the Red Cross, only one for-profit is larger than the Adolf­sens’ op­er­a­tion, ORS Ser­vices, a Swiss com­pany that in 2014 gen­er­ated $99 mil­lion in profit car­ing for refugees in Switzer­land, Aus­tria, and Ger­many. (ORS won’t dis­close its 2015 prof­its.)

The Adolf­sens have suc­ceeded in part be­cause they have a back­ground in hos­pi­tal­ity. In the three decades since they founded Adolf­sen Group, Kris­tian and Roger have built an $800 mil­lion-a-year net­work of busi­nesses that in­cludes preschools and nurs­ing homes, as well as ho­tels, apart­ment build­ings, cruise lines, and ski re­sorts. The two en­tered the refugee sec­tor in May 2014, when they paid a Dan­ish com­pany, ISS Fa­cil­ity Ser­vices, $22 mil­lion for Hero Nor­way, a 27-year-old com­pany that ran 32 refugee cen­ters.

At first the Adolf­sens set their sights on Swe­den. Al­most im­me­di­ately, though, refugee ar­rivals in Nor­way ex­ploded, and they’ve kept ar­riv­ing since. A coun­try of 5 mil­lion peo­ple—a rel­a­tively sleepy, snow-clad, 1,600-mile-long, lute­fish-eat­ing king­dom that had never seen more than 17,000 refugees in a sin­gle year—re­ceived more than 31,500 asy­lum seek­ers in 2015 as Syria con­tin­ued to fall apart and wars in Afghanista­n, Iraq, and Eritrea

drove refugees to Europe. The Nor­we­gian Direc­torate of Im­mi­gra­tion (UDI) can’t cope with the in­flux, so it’s turn­ing to en­trepreneur­s, des­per­ately, lest more refugees sleep in the streets. “UDI calls for cap­i­tal­ists,” blared a re­cent head­line in Oslo’s Aften­posten news­pa­per.

For-prof­its now care for about 90 per­cent of Nor­way’s refugees. A gold rush has com­menced, and it’s also a bit of a cir­cus. Just out­side Oslo, a savvy en­tre­pre­neur named Ola Moe re­cently rented a va­cant hos­pi­tal for $10,000 a month, did min­i­mal up­grades, and be­gan charg­ing the gov­ern­ment $460,000 a month to house and feed 200 refugees. At a refugee cen­ter in Southern Nor­way, 50 res­i­dent asy­lum seek­ers went on a two-hour march in Novem­ber to protest the poor food, prompt­ing one politi­cian, an Ira­nian Nor­we­gian named Maz­yar Kesh­vari, to pro­claim, “Th­ese un­grate­ful peo­ple should im­me­di­ately leave the coun­try.”

Amid such con­tro­versy, the Adolf­sens ap­pear like poised pro­fes­sion­als. In press pho­to­graphs, they flash can-do smiles as they sit be­fore gleam­ing con­fer­ence ta­bles in airy of­fice tow­ers. One Oslo pa­per, Da­gens Naer­ingsliv, has called them “Nor­way’s least known bil­lion­aires.” Yet con­cerns re­main. In their mon­e­ti­za­tion of the refugee cri­sis, will the Adolf­sens pro­vide su­pe­rior, more ef­fi­cient havens, or will they cut cor­ners and skimp on ser­vices to im­prove prof­its? And does their bot­tom-line ap­proach threaten a depth of car­ing that tran­scends hard cash?

Kris­tian and Roger grew up in North­ern Nor­way, a sparsely peo­pled re­gion im­bued with a provin­cial, gloomy, Southern Rock vibe. Moon­shine is pop­u­lar there, along with fish­ing and hunt­ing, and the Adolf­sen broth­ers pride them­selves on speak­ing a north­ern di­alect, which Kris­tian says “is filled with swear words—not bad ones, but you know, stuff like ‘devil hell.’ ” Their home­town of An­denes, pop­u­la­tion 3,500, sit­u­ated on An­doya Is­land, is so windy there are al­most no trees. Their fa­ther, Kol­b­jorn, an en­gi­neer, worked days at the An­doya Space Cen­ter, launch­ing rock­ets to study the north­ern lights. In the evening, he ran a TV sales and re­pair shop. Even­tu­ally he built a ho­tel. “A lot of peo­ple in Nor­way have cab­ins,” says Kris­tian. “Our sec­ond home was the TV shop. That’s where we saw our fa­ther.”

When Kris­tian was 5, he be­gan sell­ing the lo­cal news­pa­per, the An­doya Avis. At 7, he got in­volved with the pro­duc­tion of a North­ern Nor­way ocean del­i­cacy, cod tongue. It was his job each win­ter af­ter­noon to jab hun­dreds of cod down onto a metal spike, one by one, be­fore lop­ping off the fish’s tongues with a knife. “As soon as the last bell rang at school,” he says, “I be­gan sprint­ing. You had to be the first on the pier. There were only so many fish.” He cut quickly, run­ning be­hind his wheel­bar­row in the 10F to 15F air to fetch loads of fish. Af­ter three hours, he’d spend three more sell­ing cod tongues door to door. “But that wasn’t so bad,” he says, “be­cause then you could wear gloves.”

Roger stayed out of the cod tongue in­dus­try (by the time he came of age, his mother was weary of liv­ing in a house­hold smelling of fish), but he soon fol­lowed his brother into com­pet­i­tive run­ning and cross-coun­try ski­ing. The broth­ers served as de­liv­ery boys, Kris­tian car­ry­ing gro­ceries on his sled and Roger baked goods. Both worked as sales­men in the TV shop, and dur­ing the late 1970s—as Nor­we­gian con­ser­va­tive Kare Wil­loch rose to power, even­tu­ally be­com­ing prime min­is­ter in 1981—the broth­ers grew in­fec­tiously ex­cited over his staunch op­po­si­tion to the so­cial demo­cratic state that took root in Nor­way af­ter World War II.

Kris­tian and Roger ran for the An­denes City Coun­cil as teenagers. Both won seats and fought for the pri­va­ti­za­tion of road ser­vices and garbage pickup in An­denes. “My first speech was about pri­va­tiz­ing the road grad­ing,” Kris­tian says. “I spent hours writ­ing and cor­rect­ing many times what I would say. I tried to mem­o­rize ev­ery word.”

When the Adolf­sens made their first ma­jor busi­ness move in 1991, pur­chas­ing the 44-room An­drikken Ho­tel in An­denes, the ges­ture had an al­most holy res­o­nance: They were buy­ing the very ho­tel their fa­ther had built. In 1981, Kol­b­jorn had lost the busi­ness to bank­ruptcy. But he kept its gi­ant sign in his base­ment. It de­picted a long­necked duck fly­ing into the mid­night sun. The broth­ers re­hung it—then staffed the ho­tel with old friends from An­denes, es­tab­lish­ing a tone. “We have a coast cul­ture in our com­pa­nies,” Kris­tian says. “We are pro­fes­sional but in­for­mal, and we base ev­ery­thing on trust. When you grow up in a small place, you can’t do any­thing wrong. You get a bad rep­u­ta­tion.”

Over the next decade, the Adolf­sens built Nor­lan­dia Ho­tel Group, which now man­ages about 30 es­tab­lish­ments, many of them Best West­erns, through­out Nor­way and Swe­den. As the Nor­we­gian gov­ern­ment started al­low­ing pri­vate com­pa­nies to make money on so­cial wel­fare work, they ven­tured into nurs­ing homes, then preschools. “We are like sports­men,” Kris­tian says calmly and clin­i­cally, ex­plain­ing his and Roger’s drive. “We set goals, and then we reach our goals, and then we have to set new goals. It is not about the money. It is about the ex­cite­ment.”

Europe’s refugee cri­sis has been bub­bling since the Arab Spring of 2011. When it boiled over last sum­mer, many Nor­we­gians trav­eled to Lesbos, Greece, on the edge of the Aegean Sea to help refugees land their boats in Europe. They set up tents, served food, and of­fered trauma coun­sel­ing. Back in Nor­way, groups such as Refugees Wel­come to Nor­way sup­plied the new­com­ers with clothes and toys as other vol­un­teers taught them to knit. The Adolf­sens, mean­while, en­listed an aide to cast about Nor­way’s hin­ter­lands for aban­doned or lit­tle-used prop­er­ties: de­funct board­ing schools, one­time re­hab cen­ters, hos­pi­tals, moun­tain ho­tels that go dead in au­tumn—any and all struc­tures where refugees could be housed tem­po­rar­ily or per­ma­nently at a profit. As Roger tended to other

as­pects of the Adolf­sens’ busi­ness, Kris­tian ex­panded the refugee ser­vices. “We see it as a niche in the health and care in­dus­try,” he says.

On Nor­way’s po­lit­i­cal left, the Adolf­sens are re­garded as dis­taste­ful and greedy, es­pe­cially by Linn Hern­ing, deputy di­rec­tor of Nor­way’s Cam­paign for the Wel­fare State and the au­thor of a 2015 book, Velferd­sprof­i­torene (The Wel­fare Prof­i­teers), which traces the grad­ual ex­pan­sion since the late 1990s of en­trepreneur­s in Nor­way’s preschools and nurs­ing homes. The cover fea­tures de­tailed, anatom­i­cally cor­rect draw­ings of creepy in­sects—par­a­sites—and Hern­ing de­votes sev­eral pages to the Adolf­sens, who, she says, are “the big­gest play­ers, the only wel­fare prof­i­teers in ev­ery sec­tor.” In early De­cem­ber, she helped Nor­way’s So­cial­ist Party and So­cial Demo­cratic Party call in Par­lia­ment for a study look­ing into the fea­si­bil­ity of ban­ning prof­i­teer­ing in refugee care.

Still, Hern­ing could point to only one spe­cific ex­am­ple of the Adolf­sens’ sup­posed treach­ery. In the small Nor­we­gian city of Moss, an hour south of Oslo, Orkerod, a re­spected, pub­licly owned, 88-bed nurs­ing home for de­men­tia pa­tients, went into tu­mult af­ter the Adolf­sens’ Nor­lan­dia Care Group be­gan man­ag­ing it in 2014. “The fo­cus on spe­cial­ized de­men­tia care dis­ap­peared,” says Lorentz Nit­ter, the clinic’s lead doc­tor un­til he quit in June. “Such care is very ex­pen­sive,” about $125,000 an­nu­ally per per­son, he says, “and Nor­lan­dia didn’t want to pay for it.” When highly paid nurses trained in de­men­tia work quit, Nor­lan­dia re­placed them with cheaper non­spe­cial­ists. “They be­gan treat­ing all pa­tients the same way,” Nit­ter says, and this was dan­ger­ous. About 30 per­cent of all de­men­tia pa­tients are “ag­gres­sive,” he says, “and they walk around caus­ing many prob­lems.”

In Orkerod’s first 12 months un­der Nor­lan­dia’s guidance, 19 nurses quit. In a re­cent op-ed in Moss Avis, Nit­ter joined two other Orkerod doc­tors in com­plain­ing that the clinic’s ex­cel­lence, built over its first 13 years of op­er­a­tion, had been “torn down in a sin­gle year.”

Kris­tian de­nies that the qual­ity of the ser­vice at Orkerod de­clined and ar­gues that de­parted staffers were dis­grun­tled sim­ply be­cause Nor­lan­dia shook them from long­stand­ing work habits. “Th­ese were peo­ple who’d been there for many years,” he says. “They were used to do­ing things their way, and then we made changes. It’s a lot more de­mand­ing to work for a pri­vate com­pany be­cause we fo­cus on pro­vid­ing bet­ter qual­ity at lower prices.”

Could Nor­we­gian refugee cen­ters suf­fer sim­i­lar changes? It’s ap­par­ently al­ready hap­pened. From 2006 to 2014, as re­ported in the Oslo pa­per Ny Tid, one of Nor­way’s largest for-profit refugee care providers, Link, ha­bit­u­ally broke bind­ing bud­get prom­ises to the Nor­we­gian gov­ern­ment. In 2014, Link, which op­er­ates 14 refugee cen­ters, signed on to a bud­get that would cap its prof­its at $230,000. By skimp­ing on promised ser­vices—child care, for in­stance, home­work help, and the su­per­vi­sion of peo­ple with dis­abil­i­ties—it ended up $1.15 mil­lion in the black.

Ny Tid’s fig­ures came from an anony­mous source within UDI, a 20-year vet­eran at the agency. When I met with this man, he said of Link, “Ev­ery year they over­es­ti­mate what ser­vices will cost them. That is how the game is played, and if new op­er­a­tors don’t understand that, they’re go­ing down.” Hall­stein Saunes, the leader for Link’s refugee cen­ters, dis­putes the fig­ures pre­sented by Ny Tid, call­ing the pa­per’s in­ter­pre­ta­tion of them “mis­lead­ing” and say­ing that Link didn’t skimp on so­cial ser­vices. Rather, he says, it saved else­where—on util­i­ties, for in­stance. “Our aim,” he says, “is to op­er­ate good re­cep­tion cen­ters within the fi­nan­cial frame­work of our agree­ments as we de­velop the com­pany and con­trib­ute to­wards solv­ing an im­por­tant task in our so­ci­ety.”

UDI’s mon­i­tor­ing of cor­rup­tion is min­i­mal, ac­cord­ing to the UDI source. “We can only con­cen­trate on open­ing new refugee cen­ters,” he said. He had no spe­cial knowl­edge on Hero Nor­way, but in discussing the com­pany, he was un­char­ac­ter­is­ti­cally sunny. “They’ve been a good part­ner for UDI,” he said. “They’re very flex­i­ble. When we need them to ex­pand, they do. It’s easy.”

Brad Hen­der­son of the United Na­tions High Com­mis­sion on Refugees notes that in re­cent months NGO care providers have fre­quently col­lab­o­rated with for-prof­its to meet the needs of asy­lum seek­ers, step­ping in to pro­vide phone and In­ter­net ser­vice, as well as to char­ter flights from Syria and else­where. He’s care­fully op­ti­mistic about the prof­i­teers. They can “cre­ate a lon­glast­ing, mu­tu­ally ben­e­fi­cial part­ner­ship with UNHCR if they can be aligned to shared goals and val­ues,” says Hen­der­son, who is UNHCR’s Euro­pean lead on fos­ter­ing re­la­tions with for-prof­its. “They can bring new ideas and vi­tal en­ergy to the refugee cause.”

It’s not clear whether oth­ers will em­brace or re­ject the Adolf­sens’ refugee riches, but sev­eral in­sid­ers pre­dict that Nor­way’s Par­lia­ment will al­low refugee en­trepreneur­s to con­tinue but will cap their earn­ings. “I wish we could op­er­ate with only NGOs and mu­nic­i­pal­i­ties run­ning refugee cen­ters,” says Marte Ger­hard­sen, the di­rec­tor of Oslo-based Tankesmien Agenda, a think tank closely aligned with Nor­way’s La­bor Party, “but right now, right here, we need Hero, and it’s to­tally il­log­i­cal to

say they can’t make prof­its. That would be like Pro­hi­bi­tion in Amer­ica—it won’t work.” She adds, “we do need to reg­u­late them, though.” Ger­hard­sen ar­gues that pri­vate op­er­a­tors be lim­ited to a 3 per­cent profit mar­gin. The Adolf­sens claim that theirs is 3.5 per­cent, but Hern­ing calls that fig­ure “highly un­likely. All the other refugee com­pa­nies that I’ve looked at have a much higher profit mar­gin.” She says that in han­dling rev­enue from nurs­ery schools and nurs­ing homes, the Adolf­sens have played a shell game, shift­ing prof­its from one busi­ness within their con­glom­er­ate to an­other. “I wouldn’t be sur­prised if they were do­ing that for Hero as well,” she says.

It’s 2 p.m. on an­other Nor­we­gian af­ter­noon, and Kris­tian and I are driv­ing south out of Oslo in his Porsche SUV. The car is new, with only 2,800 miles on it, but Kris­tian is fast to point out that he got a huge tax credit; the car is a hy­brid.

“We live like nor­mal peo­ple,” he says. “I have a reg­u­lar house and a moun­tain apart­ment and cabin, but for all th­ese I paid less than 10 mil­lion kro­ner,” about $1.1 mil­lion. “I have never hired a nanny. My brother and me, we just take small salaries”—about $230,000 a year. “We work too hard to spend the money.”

Rich peo­ple al­ways say things like this, of course, but com­ing from Kris­tian, the hum­ble talk is some­what be­liev­able. For a man who could rea­son­ably cast him­self as the Don­ald of Nor­way, he’s a re­mark­ably bland and po­lite pres­ence, even by tac­i­turn Nor­we­gian stan­dards. When we con­fer with the heads of three refugee cen­ters, he scarcely speaks. He doesn’t harry any­one, and he asks very few ques­tions. His fo­cus seems far away, en­sconced in a nether­world of ledgers and spread­sheets.

He and Roger are al­most mon­k­like in their devo­tion to busi­ness. Both work about 70 hours a week, fol­low­ing achingly me­thod­i­cal rou­tines. “Mon­day to Thurs­day,” Kris­tian says, “I work in my of­fice at home un­til 1 a.m. I leave for work be­tween 7:20 and 7:25. When I am on va­ca­tion, I work for an hour in the morn­ing and an hour at night.”

Nei­ther brother has smoked a cig­a­rette or tasted al­co­hol, and in 2011, when Kris­tian crum­pled to the ground while run­ning a half-marathon, stricken by a heart at­tack that stilled his pulse for 10 min­utes, he didn’t re­solve to slow down. Rather, as he lay re­cov­er­ing in a pub­lic hos­pi­tal, he stewed over its in­ef­fi­cien­cies. “The build­ing was very old, and the highly paid nurses spent hours walk­ing the cor­ri­dors, serv­ing food,” he says. “I thought, You could sell the build­ing for apart­ments and use the money to build a new hos­pi­tal with bet­ter lo­gis­tics.”

Right now, we’re driv­ing to Hero Nor­way’s big­gest refugee cen­ter, in Rade near the Swedish border. In re­cent weeks up to 1,200 new ar­rivals have crowded into a va­cated su­per­mar­ket, liv­ing in in­door tents as they wait for in­ter­views with the Nor­we­gian border po­lice. I feel like I’m de­scend­ing into the maw of history. I’m aware now of all the wars, the blood­shed, the hu­man strug­gle that have brought so many to re­mote Rade, which is lit­tle more than a scat­ter­ing of ugly chain stores by the high­way. Kris­tian’s re­marks drift to­ward the in­ter­na­tional only once, how­ever: when he thrills over a new app, SayHi, which trans­lates spo­ken words into more than 100 lan­guages. “It will save so much money,” he says.

Next year, Hero Nor­way hopes to open 5 to 10 refugee cen­ters in Swe­den. The cam­paign could be spot­ted with dif­fi­cul­ties. In Swe­den, ar­son­ists have torched more than 40 cen­ters since July, in part be­cause in 2015 Swe­den ac­cepted about 160,000 asy­lum seek­ers, more per capita than any other Euro­pean na­tion. Still, the prospects for Hero Nor­way’s con­tin­ued suc­cess are high. Nei­ther Swe­den nor Nor­way has plans to stanch the flow of new­com­ers, and the Swedish gov­ern­ment has said it will spend up to 30 per­cent of its 2016 for­eign aid bud­get on re­set­tling refugees.

Even­tu­ally we go in­side. I talk to a young man, age 22, who was im­pris­oned in Eritrea for prac­tic­ing Chris­tian­ity. He fled bare­foot from prison and ar­rived in Nor­way 24 hours ago. “I want to study,” he says. “I want to be­come a doc­tor.” An Iraqi Kurd tells me he es­caped clan war­fare that re­sulted in him be­ing beaten with sticks. He lifts his shirt and shows me the scars on his ribs.

Kris­tian stands back, aloof, chat­ting only with ad­min­is­tra­tors, con­fer­ring about their plans to build a health clinic here to screen refugees for tu­ber­cu­lo­sis and other diseases.

In time, we’re given a tour by the camp’s di­rec­tor. Helge Ekelund is a large, hulk­ing fel­low with a tight pony­tail, and he’s a no-non­sense guy who’s well aware that the great mi­gra­tion to Nor­way can con­tinue only if there are func­tion­ing toi­lets. “Here are the tents we got free from the army,” he says. “Here is where we take away ev­ery­one’s clothes. We put the clothes in th­ese freez­ers here, to kill off the bed­bugs.” The freezer is set at -30F, he says. The clothes stay in there for 48 hours, while the asy­lum seek­ers wear bor­rowed gar­ments.

When Kris­tian and I step back into the rain, I ask him what about the refugee cen­ter in­trigued him the most. “The freez­ers,” he says. “I thought those were in­ter­est­ing.”

We be­gin driv­ing north. It’s 3 p.m. There are still 10 hours to go be­fore his work­day is over. <BW>







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