Business news from Ukraine


The European Bank for Reconstruction and Development (EBRD) under EBRD’s Ukrainian Sustainable Energy Lending Facility III (USELF III), a EUR 250 million facility to support renewable energy in Ukraine, will partially finance construction of the Dnepro-Bugsky wind farm with a planned capacity of 110 MW located in Oleksandrivka (Kherson region).
The decision was made by the EBRD board on July 10, EBRD Senior Adviser External Affairs for Eastern Europe & Central Asia Usov told Interfax-Ukraine on Thursday.
EBRD said that Dnepro-Bugsky Wind Power Station LLC is the borrower of the funds. The borrower is ultimately fully owned by three sponsors, Akuo Energy SAS (France), Saffelberg Investment NV (Belgium) and Aeolus Invest NV (Belgium). The limited liability company is a special purpose vehicle incorporated in Ukraine for the purpose of developing, constructing and operating the project.
The total cost of the project is EUR 188.64 million. The possible share to be paid by the EBRD is not disclosed.
According to other materials of the project posted on the bank’s website, Dnepro-Bugsky wind farm will belong to Akuo Energy.
The project consists of 25 4.4 MW turbines on the Dniprovsko-Buzsky Lyman, which will be delivered by Nordex. Under the project it is planned to build a 150 kV power line to the Posad-Pokrovska substation of 27.3 km long with 194 pillars.

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The activity of construction on regional retail real estate markets is growing, and the reconceptualization trend for existing shopping centers would remain, UTG Director Evgenia Loktionova has said. “The construction of retail real estate is growing, and not only in Kyiv. There are all prerequisites for increasing it in the regions, as the concepts of the last five years are moving into an active construction phase, which will significantly influence the existing market. I think active construction will move to regions, and Kyiv will finish the started projects,” she said at a press conference on the results of the real estate market for the first half of 2019 at Interfax-Ukraine on Wednesday.
At the same time, according to Loktionova, in the next two years the reconceptualization trend and redevelopment of existing facilities in the retail real estate market will continue.
“Our most “sleeping” regions, where there are not many shopping centers that felt comfortable enough in the absence of competition, will now feel serious pressure. This is Khmelnytsky, where two facilities of 50,000 square meters are being built, Vinnytsia with a facility of more than 50,000 square meters, Dnipro with a facility of more than 100,000 square meters. Thus, all new facilities will be built taking into account the existing current trends and new tenants in the market, respectively, this will allow new shopping centers to be ahead 10 years of the existing centers,” Loktionova said.
In general, according to her, among those announced for opening before the end of 2022, 44 projects with a total lettable area of 1.36 million square meters are at different stages of implementation in Kyiv and the nearest suburbs.
According to Head of the UTG Strategic Consulting Department Konstantin Oleynik, if these projects are implemented and launched, there is a prospect of a surplus of retail space, which will lead to an increase in vacancy and lower rental rates in obsolete facilities.
“There are large facilities that can significantly affect the distribution of forces in the market. Some of the loudest are the River Mall shopping and entertainment center, Blockbuster Mall shopping and entertainment center, Lukyanivka shopping and entertainment center, and the second stage of the Auchan Rive Gauche shopping and entertainment center. In addition, there are a number of facilities that have just been announced, for example, a multifunctional complex in Lesia Kurbasa Avenue, the White Lines complex entering the active phase, the Respublika shopping center frozen in 2014, Ocean Mall shopping center, April Mall shopping center, Retroville shopping center, Lesnaya Mall shopping center,” Oleynik said.
According to the expert, among the projects for reconstruction/reconceptualization in Kyiv is the Karavan shopping and entertainment center, which will turn into an outlet center, the Lukyanivka shopping center, the Dream Town shopping center, and the Gorodok Gallery shopping center. The tenants of the Sirius shopping center in Troyeschyna, which will become the New Way shopping center of the district format, will change, and the Marmelad shopping center will also be updated.
According to UTG, in 2019, the Smart Plaza Obolon shopping center and the Oasis shopping center opened.
Thus, as of the end of June 2019, there were six regional trading facilities operating in Kyiv, 26 – district, 24 – microdistrict, 18 – specialized and 32 detached hypermarkets.
Despite this, the company records a reduction in the vacancy rate of retail space to 5.5%, and the entry of new international retailers to the market, such as Decathlon and In Wear Matinique, contributed to this. Until the end of the year, another seven operators are expected to enter the market, among which are Ikea, The North Face, Eataly, Funday, and others.
According to the UTG’s information, the average daily attendance of the shopping and entertainment centers at the beginning of July 2019 is 677 people per 1,000 square meters, which is 4% higher than in the same period in 2018. In terms of saturation with high-quality retail space, Kyiv is ahead of Budapest and Sofia, with an indicator of 527.1 square meters per 1,000 inhabitants.
According to the company, rental rates in U.S. dollars have increased by $0.9 since the beginning of the year and amounted to $24-70 per square meter a month. At the same time, fixed rental rates for restaurants and cafes are $15-30, for large-format clothing stores (600-1,500 square meters) – $1.5-20, for fashion galleries (100-200 square meters) – up to $70, for cinemas – $4-15, for grocery supermarkets – up to $15.

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Volume of construction production by type by region in jan-may 2019 (mln.Uah)

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The executive committee of the Lviv City Council has approved the town-planning conditions and limits for designing an office and hotel center at 191b, Liubinska Street.
As reported on the website of the City Council, private enterprise Galmodern plans to build an office center with underground parking and a hotel and office center with underground parking on the site. The facilities will be located near the Lviv airport. reported with reference to Head of the department of architecture and urbanism of the Lviv City Council Yulian Chaplynsky that Galmodern is negotiating the opening of a hotel under the international brand of Hilton Hotels & Resorts.
“There are negotiations with the Hilton network. But for the time being they have only received town planning conditions for design. It is finally unknown if they submit this [the project] to Hilton or another network,” Chaplynsky said.
According to the unified public register, Natalia Onoshko (100%) is listed as the participant and ultimate beneficiary of Galmodern.
She also acts as a signatory to LLC Innovation Management Systems, registered in 3, Shukhevycha Street, in Lviv. At this address, the Ibis hotel operates (Ibis Styles Lviv Center opened at the end of 2015).

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The UFuture investment group of Ukrainian businessman Vasyl Khmelnytsky plans to invest $2.5 million in construction of a composite plant in the Bila Tserkva industrial park within two years. “We together with Volodymyr Khmurych director of the Bila Tserkva industrial park laid the capsule of the new plant in the industrial park. Here in six months there will be a composite plant. In America, composite materials have already replaced metal by 15-17%,” Khmelnytsky wrote on his Facebook page.
According to him, the plant intends to create 100 jobs.
“Before starting the construction of a large plant, we leased a place in the workshop, bought one line of equipment, adjusted it and launched the first batch of the product. It cost only $85,000, we made sure that everything works, that the quality of the product is high, and decided to scale up production,” Khmelnytsky said.
He recalled that this will be the second plant in the Bila Tserkva industrial park, and by the end of the year it is planned to build three more.
As reported, the first plant in Bila Tserkva industrial park – Plank Electrotechnic, which will be the first in Ukraine to produce modern electrotechnic systems, was officially opened in April of this year. UFuture invested $ 2.8 million in its creation.
UFuture unites companies and social projects of Khmelnytsky. The group includes the Bila Tserkva industrial park, the UDP development company, the Sikorsky Kyiv International Airport, outdoor advertising operator RTM-Ukraine, as well as innovative businesses: UDP Renewables (creates and develops photovoltaic power plants under its control), the pharmaceutical company Biopharma, innovative parks UNIT.City and LvivTech.City.

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The total area of new residential and nonresidential buildings as of the start of their construction in January-March 2019 grew 1.9-fold year-over-year, to 2.7 million square meters. According to the report, the total area of apartment buildings in Q1 2019 was 2.662 million square meters (97% of the total volume), single-apartment buildings – 56,500 square meters and dormitories – 18,200 square meters.
The total area of new residential buildings at the beginning of construction in Kyiv grew 3.3-fold in Q1 2019, to 1.1 million square meters, while in Kyiv region the growth was small, to 220,000 square meters (212,000 square meters in 2018).
According to statistical data, the growth in the volume of new housing construction was also recorded in Lviv (3.2 times, to 377,900 square meters), Odesa (1.7 times, to 376,400 square meters), Kharkiv (1.6 times, to 231,300 square meters) and other regions.