Project number:


Business sector:

Property and tourism

Notice type:


Environmental category:


Approval date:

09 Sep 2008



PSD disclosed:

05 Aug 2008

Project Description

The EBRD is considering making a loan of USD 20 million to private Armenian company D&H GROUP LLC to support the financing of a multi purpose complex construction of 79,330 square meters in the city of Yerevan, Armenia. The complex will include 315 residential units targeting the middle class market and 19,000 square metres of international standard office space, available for rent or sale.

Transition Impact

This is the first real estate development project in Armenia being considered by the EBRD. The transition Impact potential of the Project is demonstrated in the following points:

1. Demonstration effect of new product and energy efficiency standards

a) The Project will be the first class A/B+ development in the country which offers higher quality residential and commercial facilities, and is thus expected to expand the quality segment of the local residential property market.

b) The Project entails the use of energy efficiency technologies and practices which exceed national requirements in terms of energy performance. The energy performance indicator in kWh/m2 per year is expected to reach the level of class A-/B+ (A is the best, G is the worst) according to the EU energy rating under comparative climatic conditions and operational mode of building.

The use of best available technologies, especially high-grade thermal insulation with low-conductivity, low-emission glazing with selective coating, air-conditioning system with heat recovery and flow controllers, water saving mixing taps with flow reducers, energy saving fluorescent luminaries with electronic ballasts as well as implementation of advanced automation and control systems with integrated building management, are expected to have a strong demonstration effect in the sector.

2. Backwards linkages and dispersion of skills

The local subcontractors will need to upgrade and enhance their services in order to meet the new quality standards required, such as submitting international certificates for all construction materials and goods to be verified and checked by the Bank’s Supervisor. The process of skills and knowledge transfer started during the extensive due diligence process when the Bank involved independent market, technical and environmental consultants to advise on the Project and make recommendations regarding its improvement (layout of flats, adding second bathroom etc) which the Client has taken on board. The skills transfer to the Client and local subcontractors will continue during the construction process, which will be monitored by the Lender Supervisor to be hired by the Bank and after construction completion through operating of the office space and tenants management.

The Client

D&H GROUP LLC (the "Borrower” or the “Company”) is a limited liability special purpose company registered in Armenia, 90% owned by an Armenian businessman, Davit Varagyan (the “Sponsor”) and his relatives, and 10% by an Armenian company, Karven Yerevan LLC, which is 50/50% owned by Mr Viktor Kryltsov and Mr Balyan, both existing EBRD clients with real estate development projects in Kyrgyzstan and Kazakhstan.

EBRD Finance

USD 20 million senior loan.

Project Cost

USD 56 million.

Environmental Impact

The project has been screened B/0. The environmental due diligence including a site assessment by an independent environmental consultant (September 2007) confirmed that there are no significant environmental issues that would prevent further implementation of the Project. The site is suitable for construction and the project has been developed in accordance with national law, city planning requirements and good international practice. An environmental action plan (EAP) has been developed which will ensure that the construction and operation of the complex will be carried out in accordance with the Bank's environmental and social requirements. The Sponsor will ensure that the project complies with the provisions of the EAP, relevant national and EU environmental, health, safety and labour standards and submit an annual environmental report to the Bank

Technical Cooperation


Company Contact

Vahe Petrosyan
Financial director of D&H Group

Tel: 37410 534834
Fax: 37410 534451
Mob: 37494 423001



Business opportunities

For business opportunities or procurement, contact the client company.

For state-sector projects, visit EBRD Procurement: Tel: +44 20 7338 6794

General enquiries

EBRD project enquiries not related to procurement:
Tel: +44 20 7338 7168

Public Information Policy (PIP)

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Text of the PIP

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