Housing Rehabilitation for Empowerment (HOPE) Project, Component 2: Design and Major Repair of Partially Damaged Apartment Buildings (BKB)

Sector

Housing

Stream

Restoration of apartment buildings damaged as a result of the armed aggression of the Russian Federation

Entry into Portfolio

Included in the State Single Project Pipeline

General Information

Program Description

The Russian Federation's military aggression against Ukraine has resulted in significant civilian casualties, the displacement of millions of people, widespread and serious destruction of homes and businesses, and damage to production and economic activity.
The "HOPE" project aims to meet the critical needs for the rehabilitation of apartment buildings in territorial communities affected by the occupation or aggression by the Russian Federation, and to provide citizens with housing that has been damaged.
Investments in rehabilitation and reconstruction should lay the foundation for the gradual restoration of services to the population and economic activity, as well as consolidate Ukraine's development path towards approaching EU standards as a low-carbon and climate-resilient country.

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Strategic Case

Program Goal

Main Goal: Reconstruction of damaged/destroyed assets
Secondary goal: Improvement of infrastructure condition
Problems: According to the estimates in the updated Rapid Damage and Recovery Assessment (RDNA3) document for the period from February 24, 2022 to December 31, 2023, the housing sector is one of the sectors most affected by the military aggression of the Russian Federation (37 percent). The amount of damage is 55.9 billion USD, losses are 17.4 billion USD, and recovery needs are 80.3 billion USD. Regarding the geographical distribution of damaged housing, more than 75 percent of the cost of damage is concentrated in four regions: Donetsk (30%), Kharkiv (27%), Luhansk (12%) and Kyiv (8%); another 18 percent falls on Mykolaiv (4%), Chernihiv (4%), Kherson (4%), Zaporizhia (3%) and Dnipropetrovsk (3%) regions. More than a quarter of the damaged facilities have been destroyed (547,010 units), and the remaining three quarters are partially damaged. The project will provide access to housing, ensure citizens' access to damaged housing, review and improve the regulatory framework in the housing sector, support and develop the capacity of local governments to plan their recovery and strengthen their resilience in responding to future crises. Also, one of the project components is aimed at strengthening the institutional capacity of the responsible project implementer. In addition, the project will allow implementing a new financial and investment mechanism of state support aimed at ensuring maximum efficiency in the use of funds for the recovery of the damaged housing stock; create conditions for the stable operation of construction enterprises, preserving jobs and supporting the economy; increase the capacity of selected pilot territorial communities to plan their own recovery and further development.

Strategic Relevance of the Program

Sector
Housing
Subsector
Housing Reconstruction
Stream
Restoration of apartment buildings damaged as a result of the armed aggression of the Russian Federation
Strategic Document
State Strategy for Regional Development for 2021–2027
Task
Restoration of apartment buildings damaged as a result of the armed aggression of the Russian Federation

Program Objectives

Indicator
Baseline Value
Target Value

Number of signed construction contracts for the renovation of BKB in accordance with climate-resilient/disaster-resilient and energy-efficient design standards

0 units

194 units

Economic Case

Program Components

Financial justification

Total estimated program cost

8'956'060'000 UAH

Estimated cost of program components

8'956'060'000 UAH

Component

Amount, uah

Supporting integrated housing and urban renewal

₴135'900'000

Development of design documentation for partially damaged BKB

₴540'000'000

Repair of partially damaged BKB

₴8'280'160'000

Cost justification

Short description

Justification document

Untitled

Sources and mechanisms of financial support for the implementation of programs.

Status
Funding mechanisms
Coverage, %

Investment

Non-repayable financing. Grant financing. International (intergovernmental) grant agreement (with a predefined approach for selecting contractors or suppliers).

100%

Justification document
HOPE_62_Million_Financial_Addition_Letter_of_Amendments_Signed.pdf
What potential funding sources can be mobilized on the basis of prior agreements or intentions to cooperate (if any)

Grants and loans supported by the International Bank for Reconstruction and Development.

Management Case

Organizational Measures

Realization

28 months

Risk Assessment

Risk

Probability

Degree

Strategy

Risk

At the time of Project preparation, Russia’s invasion of Ukraine has mostly affected areas in eastern and southern Ukraine. However, the continued unpredictability and potential implications for the Ukrainian government’s ability to perform its core functions create some uncertainty. This could lead to delays in Project implementation.

Probability

Medium

Degree

Considerable

Strategy

Acceptance

Risk

Macroeconomic risks: Project results will depend on sufficient allocation of funds for Project activities.

Probability

Medium

Degree

Considerable

Strategy

Reduction