Armenian Speaker Linked With Luxury Housing Project

Armenia - Parliament speaker Alen SImonian chairs a session of the National Assembly, November 24, 2022.

Raising more questions about corruption in Armenia, an independent investigative publication has suggested that parliament speaker Alen Simonian may be involved in the ongoing construction of an expensive residential complex.

In an article published on Monday, Hetq.am revealed that a longtime friend of Simonian, Edgar Avagian, has a 25 percent stake in the real estate project, worth an estimated $40-50 million, despite not being known to be a wealthy man. It wondered if Avagian, who now works for a TV channel officially run by Simonian’s wife, is acting as a front for the influential member of Prime Minister Nikol Pashinian’s political team.

Simonian, who had already been accused of helping his brother win lucrative government contracts, was quick to strongly deny any connection to the sprawling complex built in the resort town of Tsaghkadzor. In a Facebook post, he accused the publication of failing to back up its implicit claims with any evidence.

The Pallada Tsaghkadzor complex occupying 1.6 hectares of land is projected to consist of nine buildings with a total about 700 apartments, a number of shops, a restaurant as well as a fitness center. The company building it also has three other shareholders: one Georgian and two Armenian investors.

Armenia - The Pallada Tsaghkadzor residential complex plan.

The author of the Hetq article, Tirayr Muradian, insisted on Tuesday that he asked legitimate questions about Simonian’s role in the project facilitated by Tsaghkadzor’s mayor affiliated with the ruling Civil Contract party. He argued that Avagian has never engaged in large-scale business in construction or other sectors before and has only held managerial positions in various Armenian TV stations.

“What is the logic behind his involvement in the construction project?” the journalist told RFE/RL’s Armenian Service. “What does he have in common with the other developers?”

The article pointed out that in 2017 a court in Yerevan declared Avagian bankrupt after his failure to repay $44,000 in debts to two commercial banks. Simonian’s friend still owes money to those banks, according to it.

Avagian could not be reached for comment. A lawyer representing him said that he is currently not in the country.

Muradian said that it is only natural to speculate that Avagian used his close ties with Simonian to gain the 25 percent stake in the project or that it might actually belong to the speaker.

“These people came to power [in 2018] with little business experience or capital, but within a very short period of time they got involved in large business projects,” he said. “If they are so smart what kept from doing that without power?”

Armenia -- Journalist Tirayr Muradian speaks to RFE/RL, July 18, 2023.

The journalist referred to members of Pashinian’s entourage increasingly accused by Armenian media of enriching themselves or their cronies and breaking their anti-corruption promises given during the 2018 “velvet revolution.”

In March this year, hackers hijacked the YouTube channel of the Aravot newspaper just as it was about to publish a video report detailing expensive property acquisitions by several senior government officials and pro-government lawmakers, including Simonian.

Earlier this year, Pashinian blamed such reports for a drop in Armenia’s position in an annual corruption survey conducted by Transparency International. He publicly urged senior officials to sue media outlets “falsely” accusing them of illicit enrichment. The prime minister again claimed to have eliminated “systemic corruption.”

There are also growing questions about integrity in public procurement administered by Pashinian’s government. A road construction company managed by Simonian’s brother Karlen won at least nine government contracts last year.

The controversial speaker has denounced independent and pro-opposition media outlets for suggesting that the company called Euroasphalt enjoys privileged treatment by the government. Pashinian has said, for his part, his brother does not own Euroasphalt.

RFE/RL’s Armenian Service discovered in 2021, however, that one of Euroasphalt’s two officially registered addresses matches that of a Yerevan apartment where the Simonians’ mother lived at the time.