Invest in Odessa Region. Telman Abbasov President of World Council of Developers and Investors FIABCI

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1 Invest in Odessa Region Telman Abbasov President of World Council of Developers and Investors FIABCI

2 Odessa Region Overview 2

Odessa region: key facts Odessa region located in southwestern part of Ukraine on the shore of the Black Sea. The region is the largest by its area and top-5 by population in Ukraine (2.4 mln people).

3 Odessa region: key facts Odessa region located in southwestern part of Ukraine on the shore of the Black Sea. The region is the largest by its area and top-5 by population in Ukraine (2.4 mln people). Odessa administrative center of the region and 3 rd largest city in Ukraine (1.0 mln people). The region is the main sea gate and export-import hub of Ukrainian economy. Major sectors of regional economy: agriculture, transport infrastructure, retail trade, tourism. USD 1.4 bln of FDI in 1H15 (3% of Ukrainian total) near the level of cumulative FDI for the past 20 years. Dynamics of FDI into Odessa region, USD mln 1,400 1,200 1, Kyiv Odessa Selected Ukrainian cities by population, mln people Source: Department of Statistics of Odesa Region Source: UkrStat 3

Odessa region: top-5 regional economy Share of each region in total Gross Regional Product 20% Top-5 most economically developed region in Ukraine (based on GRP as of 2013, out of total 27

#3 by per capita expense after Kyiv city and Kharkiv region, although #7 by per capita income. #3 in transport and warehouse sector (by output). #4 in retain trade.

4 Odessa region: top-5 regional economy Share of each region in total Gross Regional Product 20% Top-5 most economically developed region in Ukraine (based on GRP as of 2013, out of total 27 administrative units). Lowest unemployment rate comparing to other regions (6.7% vs. 9.3% average for Ukraine). #3 by per capita expense after Kyiv city and Kharkiv region, although #7 by per capita income. #3 in transport and warehouse sector (by output). #4 in retain trade. #4 in hospitality and catering sector. #9 in agriculture sector. #5 in export of goods and services. Major exported items - agriculture products, chemicals, fertilizers, oil and refining products account for 75% of total exports. Ukraine, and Odessa region in particular, possesses the most powerful port potential among all countries of the Black Sea region. 7 ports out of 13 located in Odessa region and account for about 75% of the entire cargo turnover in Ukrainian merchant seaports. Odessa ports handle over 65 mln tons of cargo annually. The most important ports are Odessa, Illichivsk and Yuzhnyi seaports over 55% of cargo turnover of domestic seaports. The major container terminals are also located in this three ports. 15% 10% 5% 0% Source: UkrStat 5% Sea ports location in Odessa region Reni Izmail Odessa Ust-Dunaiiskyi Odesa average Yuzhnyi Illichivsk Bilhorod-Dnistrovskyi 4

5 Odessa region: cheap and highly skilled human capital Population of Odessa region: 2.4 mln people. Population of Odessa city: 1.0 mln people. 67% urban-based. Life expectancy is 70 years. Over 55% of population in economic active ages of years. The region in top-3 most attractive for migrants, after Kyiv and Kharkiv region. Odessa is educational hub, along with other largest Ukrainian cities such as Kyiv, Kharkiv, Dnipropetrovsk and Lviv. #5 city by number of students per ten thousand of people The city has 39 institutions of higher education with over 30,000 graduates annually. Change in population due to migration, ths people Annual income per capita, UAH 100,000 High-Cost 90,000 Weakly-skilled 80,000 70,000 60,000 50,000 40,000 30,000 20,000 10,000 0 Source: UkrStat Dnipropetrovs k Zaporizhzhia Odesa Lviv Kharkiv Kyiv Low-Cost Highly-skilled ,000 1,200 1,400 1,600 1,800 Students per 10,000 ofpopulation Population by age % 10% 20% 30% 40% 50% 60% Change in population due to migration, ths people Source: UkrStat 2011 Odesa region Other regions Kyivregion Series Kharkiv region Series3 5

6 Key reasons to invest in Odessa region 1. Ground floor opportunity pro-western and pro-business focused on implementing reforms challenges create momentum Ukraine is well positioned to become a future economic turnaround success story, with Odessa region as a locomotive of changes 2. Low-cost but highly skilled human recourses low average salary of USD 1.3 per hour, highly below peers - USD 8.3 in Poland, USD 2.1 in China 4 th most educated nation 3. Proximity to key markets delivery of goods in days to European hubs rather than ship traveling from Asia for weeks robust infrastructure 4. Attractive entry valuations bank financing virtually closed, as banks are primarily focused on improving their balance sheets (interest rates in local currency is over 20%) severe 60% local currency devaluation in 4Q14-1Q15 squeezed margins and pushed companies to look for export opportunities increasing demand for capital from companies who seek money to finance its working capital needs, to finance growth, develop exports or modernize production. 6

7 Investment Opportunities 7

8 Project Global Regoin Initiative group: Telman Abbasov initiator, President of World Council of Developers and Investors FIABCI, President of group of companies «Title» Igor Litvinyuk Head of Ovidiopolskiy district administration Realization of the project «Global Region» on the territory of Odessa Region in the frames of new model of inclusive development will allow the region to become not only informative and monitoring, and transport and logistics hub, but also regional center of designing global innovative and industrial high value added chains, and management of this value.participation of international experts and specialists in the project. Project platform: Establishment of the Institute of Designing territorial systems of sustainable inclusive development, Zoning of allocated territory, Introduction of internal currency on the basis of labor costs State - private public partnership Dislocation of business activity within clusters: - agro-bio-technological, - ecological, - tourist, - construction, - transport and logistics 8

9 Pilot project «Urban City» Use of housing problem of the most active category of population as the cause for inclusive development of territorial community on a fundamentally higher level of social and infrastructure development; Construction of Urban City has goal to provide domicile to 50 ths. persons, who are now waiting for their turn to receive apartment, militaries, and forced out-migrants with their own social and domestic infrastructure: Kindergartens and schools, Medical establishments, Sport, and trade and entertainment complexes, Park zones Total construction area 2 mln. sq. km Introduction of smart system «Energy efficient city» Use of modern and energy efficient construction technologies Project philosophy «Build your house by yourself» - people are employed, and receive domicile Creation of public and business complex, which will include: business, trade, entertainment and logistics components Simultaneous moving of 50 ths. inhabitants will ensure investor the demand for commercial estate; enterprise owners labor market; and provide creation of consumer market. 9

10 Project Odessa-Reni Highway Description of demand and its volume The highway passes through the territory of Odesa region and coincides with the direction of international transport corridor Black Sea Transport Ring. Objectives: Promote the Europe-to-Asia transport corridor to connect Turkey, Greece, Bulgaria, Romania, Hungary, South Europe and the European Union in general with Ukraine and further with Georgia, Azerbaijan, Kazakhstan, China etc. Develop the industrial, agricultural, transport, trade, tourist, recreation potential of Odessa Region and South of Ukraine in general. Make of Odessa an important crossroads of co-operation between the European Union and Asian countries. Develop links in various fields between the EU and Ukraine in view of the Association Agreement. Facilitate humanitarian contacts in the border areas of Ukraine, Romania, Moldova. Technical solutions The total length of road is 261 km. Construction is planned to be carried out according to the parameters of a road category "IA" envisaging the minimum width of road bed to be 28,8 m. At that, the carriageway will have 4 traffic lanes, of 3,75 m width each. Current status In 2010 a feasibility study of the first stage of construction of a State motor road Odesa Reni (to Bucharest) regarding the new direction Odesa - Ovidiopol' - B.Dnistrovs'ky - Monashi with a bridge across Dnistrovski Lyman (Estuary) was developed and it received a positive expert conclusion. Currently a land plot undergoes legal expertise. Cost (overall investment) - 3,000,000,000 USD 10

Project International Airport Izmail Location: Ukraine, Odessa Region, Izmail Internal Environment: 1: The airport has a runway of 1800 meters length and 37.

11 Project International Airport Izmail Location: Ukraine, Odessa Region, Izmail Internal Environment: 1: The airport has a runway of 1800 meters length and 37.5 meters width, classifying it as a category 4C airport which allows only aircraft with cat 4C, B, and A to operate. 2: In the past, the operation of passenger flights to turkey from Izmail Airport was quite successful according to the positive development of passenger numbers. 3: The airport facilities as well as the equipment are constructed for passenger transportation. However, the current constructional conditions require a renewal. The airport stopped operating in 2010 due to financial difficulties and aims to resume operation in the near future. 11

Project of Customs - License Warehouse Construction of Customs - License Warehouse, Class A + / Dry Port Location: Belyaevskiy district, Odessa region, Ukraine Container sites: the capacity of

12 Project of Customs - License Warehouse Construction of Customs - License Warehouse, Class A + / Dry Port Location: Belyaevskiy district, Odessa region, Ukraine Container sites: the capacity of 180,000 TEU / year the share comes container / transported the railway transport - 20% the share comes container / transported auto transport - 55% area territory hectares Ingredients. General purpose: bandwidth m2 a year 20,000 m2 (the outer perimeter), Section 2, Class B flowsheet: wagon - structure - container and back; container - storage - transportation (van) - back Total area - 4 hectares Car terminal: capacity cars a year storage area for 830 parking spaces territory total area of 2.5 hectares Investment: USD IRR: 58,3% Payback: 84 months 12

Project Illichivsk Commercial Sea Port Funding required: negotiable (through public private partnership: concession treaties, joint ventures, lease agreements, other PPPs chemes).

13 Project Illichivsk Commercial Sea Port Funding required: negotiable (through public private partnership: concession treaties, joint ventures, lease agreements, other PPPs chemes). Investment areas at Illichivsk Commercial Sea Port: Sea terminals infrastructure development: -grain sand vegetable oil transhipment capacity increase projects. -ores and coal transhipment capacity increase projects. -sulfur transhipment capacity increase projects. -containers transhipment capacity increase projects. Motor road infrastructure development Rail road infrastructure development Energy efficiency improvement projects. Dredging - increase port capacity to serve larger (e.g. capesize) vessels. 13

Project Transshipment complex Allocation planned: Construction of a multipurpose transhipment complex on its owned 133 ha land plot at the deep sea port of Yuzhnyy (Odessa Region) Total Investment:

14 Project Transshipment complex Allocation planned: Construction of a multipurpose transhipment complex on its owned 133 ha land plot at the deep sea port of Yuzhnyy (Odessa Region) Total Investment: USD including Equity - 40%, Debt - 60% IRR: 33% Payback: 12,5 years Project parameters Grains transshipment capacity - 10m t/y Rail unloading rate - 3k t/h Trucks unloading rate - 1.5k t/h Storage capacity - 940k m3 Vessel loading rate - 6k t/h Veg. oil transshipment capacity - 264k t/y 14

Project SwissOtel Odessa Total built surface: 64 663 sq.

15 Project SwissOtel Odessa Total built surface: sq.m Total territory: 1,417 ha Number of floors: 24 floors above the entrance level and three floors below The complex consists of: - Five star hotel of 253 rooms Serviced apartments under management of the hotel. (swissôtel living, swissôtel residences) - Bars - Restaurants - Conference facilities - Spa complex with three pools, Turkish bath Hamam and sports rooms. - Beach-club - Two multilevel parking's with 125 and 49 places Current state: unfinished 15

Project Exhibition complex Multifunctional entertainment - exhibition complex Location: Odessa region, 6 km highway Odessa- Kiev Land area: 6 ha Total investment: 125 000 000 USD The cost

16 Project Exhibition complex Multifunctional entertainment - exhibition complex Location: Odessa region, 6 km highway Odessa- Kiev Land area: 6 ha Total investment: USD The cost of land: USD IRR: 27% Payback: 5 years The concept of the project involves the construction of: - A complete infrastructure, - Hockey arena, - Winter aqua park, - Concert Hall. 16

17 Investment- Development company «TITUL» The Group of companies "TITUL" provides a wide range of services in the field of development, investment consulting, property valuation and business, construction, real estate services, both in Ukraine and abroad. The Company acts both buy or sell side mandates, especially concentrating on acquisition and development of investment grade, high value investment opportunities in already income generating properties as well as in green field projects. The Company believes in providing the right information not just the raw data. As a result it provides a broad range of financial assessment, modeling, legal, technical and operational services for its clients in all stages of investment development activities from search, to risk assessment, due diligence and to closing. Group of Companies «TITUL» has a strong team of investment professionals, working closely with a network of formidable solution partners and advisors from Germany, England, Russia, USA, United Arab Emirates, Switzerland, Latvia, Malaysia, Turkey, Italy, Bulgaria. The number of our partners is constantly increasing and the geography of the activity is growing. The team offers customized investment advice and strategies as per the client s requirements, plans, risk appetite and assets inherent values and growth potential. The Company offers for its clients the benefits of the state of the art technical and legal support mechanisms at highest international corporate standards with firsthand practical experience on the field. The Group of companies "TITUL" operates in the Ukrainian market since 1997 and has a 20- years working experience and more than 5 years in the international market. After Telman Abbasov was elacted as a President of FIABCI World Council of Developers and Investors, the company opened new possibilities of its activity. 17

18 Contacts Thank you for attention! Telman Abbasov Tel.:

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