Promprylad. Renovation

Project description

"Promprylad. Renovation" is the transformation project of the old plant in the center of Ivano-Frankivsk into the territory of interaction between people, business, educational, cultural and social initiatives. Promprylad does not have a single investor. Anyone can join and become co-owner of the “territory of the future”. The project will create positive conditions for business and social initiatives focused on the development of new economy, urban planning, contemporary art, and informal education in the region.

The project anticipates renovation of 28 thousand m² of space in the existing buildings and construction of two new facilities covering 10 thousand m². Within five years the project is planning to attract USD 30 million investments from private investors and organizations in order to gradually launch six facilities and a park. The renovated space will host: offices, laboratories, workshops, exhibition and entertainment centers, hotel and hostel, farmers market, restaurants and many others.

Implementation of the project corresponds with the Development Strategy of Ivano-Frankivsk for the period up to 2028 and is part of strategic goal A. 2. development of small and medium-sized businesses.

One of the problems of developing small and medium-sized businesses in the city that the project will solve is the establishment of cooperation with potential international partners (for more information, see the research of SRI International – Ivano-Frankivsk Innovation system Mapping Report (https://promprylad.ua/wp-content/uploads/2018/11/IF-Innovation-System-Mapping-Report.pdf).

The American company SRI International – Ivano-Frankivsk Innovation system Mapping Report conducted preliminary marketing studies of the demand for goods/services that will be produced/provided (https://promprylad.ua/wp-content/uploads/2018/11/Final-Report-and-Recommendations-for-Promprylad.Renovation.pdf).

Market analysis is presented in the project business plan (https://promprylad.ua/wp-content/uploads/2019/03/Proekt-Promprilad_Biznes-plan_korotka-versiya-sayt.pdf)

Economic justification "Promprylad. Renovation" is the multifunctional commercial property focused on operating income. Annual net operating income of the project amounts to USD 3.2 million. Rate of return after the reconstruction was determined at the level of 10-12% annually. Currently the project attracted USD 5 million and 6,200 m² of the plant renovated. 23 international and Ukrainian organizations as well as 590 private investors have already joined the project.

During 2019-2023, the project will attract more than UAH 700 million of investment from private investors and organizations to launch six buildings and a park. The total project budget is USD 30 million. USD 5 million already attracted. Another USD 5 million – grant funds.

Expected result:

• implementation of a large-scale project by achieving a competitive advantage in the form of a wide range of infrastructure facilities on the territory and a positive public image;
• the opportunity to become one of the first large-scale Ukrainian revitalization projects based on the joint investment model, respectively, you can enlist the support of international donor organizations;
• attracting large foreign companies as partners/residents.

Project performance indicators:

• net present value (NPV) - USD 6.5 million*.
• internal rate of return (IRR) - 25.3%*
• return on investment (ROI) - 11.7%*

* according to the business plan developed by Ernst & Young in 2017. The updated financial forecast will be published at the beginning of 2021.

Estimated project cost

Estimated project cost USD 30 million (UAH 831 million)

Sources of funding

Private investments (available USD 5 million) and grant funds (available USD 5 million)

Additional information

Website of the project "Promprylad. Renovation" https://promprylad.ua

Project initiator

Project is implemented by the consortium of the strategic partners: Teple Misto, Insha Osvita, MitOst, Pact Ukraine and LvBS