The Sponsor: M2RE, the Projects Sponsor, is a diversified real estate player in Georgia focused on residential developments targeting middle class and economy class buyers and building portfolio of income generating assets including hotels. Current project portfolio comprises mainly of a mix of affordable housing units, middle income units and commercial real estate.

The Borrowers: Two Special Purpose Vehicles (SPV) to be established in Georgia (i) one for the development hotel investment namely Ramada Encore and (ii) a second SPV for the development of affordable housing projects.

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The proposed project include:
(i) The construction, equipping and placing into operation of a 152 room 3-star Ramada Encore Hotel for a total project cost of up to US$13.5M where IFC is considering providing a senior loan of up to US$7M; and
(ii) The financing of the corporate working capital needs related to the development of low to middle income housing projects in Tbilisi, where IFC is considering providing a senior loan of up to US$15M and mobilizing B loan up to US$15M.

22.0 million (USD)

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	22.0
Equity

* These investment figures are indicative

The Projects will involve the construction of new affordable housing projects across the city of Tbilisi (Kazbegi Avenue and Tamarashvili Streets, Tbilisi, Georgia), and as 3 star business hotel (Kazbegi Avenue, Tbilisi, Georgia).

(i) Business Infrastructure Development: The Hotel Project will help alleviate the lack of modern business infrastructure, especially in the mid-market segment in Georgia by bringing the first 3 star branded international hotel to the country;
(ii) Continue increasing supply of green, affordable and quality housing and a hotel: M2RE has helped pioneer the establishment of sustainable real estate development in Georgia with the first affordable housing project IFC financed in 2013.
(iii)Job Creation: The Hotel Project will create additional direct and indirect employment during construction and operational phases. Affordable housing project will create additional indirect employment during the construction phases.
(iv) Enhanced Upstream and Downstream Local Supply Linkages with MSMEs: The Hotel Project will contribute to the development of the local economy by facilitating linkages with MSME vendors that will serve the needs of both the hotel and their guests. The AfH project will increase the demand for construction and building material.
(v) Increased Tax Revenue: Both Projects will increase tax revenues for the country, states, and local municipalities;
(vi) Community development: The housing developments will contribute to the renovation and expansion of urban infrastructure and surrounding community development, including the construction and rehabilitation of roads, electricity, water access and sanitation serving the developments.
(vii) Demonstration effect: Affordable housing project will have the strong demonstration effect by fostering competition in the housing sector in Georgia and restoring credibility. In addition, the project with its standard for green buildings is helping raise the level of awareness of the economic benefits of green building, therefore increasing demand and inducing other developers to follow suit.

(i)Sector Expertise: Project will benefit from IFC''s profound technical expertise in the hotel and affordable housing sectors;
(ii)Green Building Advice: IFC''s green building specialist will be involved in the Project providing advice;
(iii)Enhancement of Environmental and Social (E&S) management system and Standard setting in energy efficiency. Currently, there is no building code in Georgia, IFC''s involvement will ensure that the Project is implemented based on the international best practice in the E&S, especially Life Fire and Safety;
(iv)Complementing governmental efforts to promote the development of new AfH units.

Indicator	Metrics	Comments	Calendar Year 2022	Calendar Year 2023	Calendar Year 2024
Organizational capacity and Management Programs(%)	Organizational capacity and Management Programs(%)		Not Available	Not Available	Not Available
Hotels: Number of Hotel Rooms Built/Refurbished (#)	Rooms (#)		Not Available	Not Available	Not Available

This is a category B project according to IFC’s Environmental and Social Review Procedure because of the limited number of specific impacts that may occur. These impacts can be avoided or mitigated by adhering to generally recognized performance standards, procedures, guidelines or design criteria.

Please refer to the related Environmental and Social Review Summary (ESRS) document for this project.

Please refer to the Environmental and Social Action Plan (ESAP) tab in the related Environmental and Social Review Summary (ESRS) document for this project.