Project description
and objectives:
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The proposed project involves the development, construction and operation of a chain of mid-range international quality hotels throughout Russia in a Joint Venture with Renova and Merrill Lynch. The Hotels will be managed by Park Plaza Hotels Europe BV under the Park Plaza brand. The objective is to establish a chain of international standard 3-4 star hotels in Russia with a particular emphasis on the regions.
EBRD will acquire a 25% stake in two companies, S.H.M. Standard Hospitality Management Limited and Ferens Management Limited, each a limited liability company established in Cyprus. S.H.M. Standard Hospitality Management Limited will act as a developer and asset management company and Ferens Management Limited will hold the portfolio of the real estate assets which is expected to include 15 to 20 hotels.
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Transition impact:
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EBRD’s catalyst role will contribute to the development of the hospitality market especially in the Russian regions and will have a positive transition impact in the following areas:
1. Market structure and increased competition
By addressing the unmet demand for international standard economy hotels in Russian regional cities, the Project will increase competitive pressure in the local hospitality sector currently dominated by Soviet style hotel accommodation, thereby having a positive effect on the quality of services and improving value for money.
2. Demonstration effect
With still relatively few international hotel groups active in Russian regional cities, the introduction of an economy hotel chain managed by a leading international operator will have significant demonstration effects in the hospitality sector, attracting more international hotel operators to expand their activities to Russian regions.
3. Backward linkages and skills transfers
The use of local sub-contractors will contribute to a significant upgrading of technical and managerial skills in the regional construction sector. The regional hotel services sector will benefit from major training and development of local staff in a variety of areas such as IT, customer service, marketing etc. and new employment opportunities will be created through the gradual reduction of expatriate staff.
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The client:
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Two companies: S.H.M. Standard Hospitality Management Limited and Ferens Management Limited, each a limited liability company established in Cyprus.
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EBRD finance:
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25% of the two companies, in total up to USD 52 million.
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Total project cost:
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Up to USD 208 million total equity commitments.
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Environmental impact:
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Screened C/1. The Client is required to implement the Bank's Environmental Procedures for Multi-Property Development including adequate environmental due diligence and monitoring for each sub-project and submission of Annual Environmental Reports to the Bank. The Bank will monitor the project by reviewing the AER and visiting the sub-projects where necessary and adequate.
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Technical
cooperation:
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None.
For consultant opportunities for projects financed by technical cooperation
funds, visit procurement
of consultants.
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Company contact:
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Andrei Shirnin, Managing Director
Renova Stroy Group Hotel Holding and
4th Podkopaevskiy per., Moscow 109208, Russia
tel/fax +7 495 755 80 81
S.H.M. Standard Hospitality Management Limited
Nausis 1,Karapatakis BUILDING, P.C 6018 Larnaca, Cyprus
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EBRD contact:
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Julia Stepanova, Operation Leader: stepanoj@ebrd.com
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Business opportunities:
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For business opportunities or procurement, contact the client company.
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General enquiries:
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EBRD project enquiries not related to procurement:
Tel: +44 20 7338 7168; Fax: +44 20 7338 7380
Email: projectenquiries@ebrd.com
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