Built Around
the Capital
the Capital
Armenia's marzes are building again.
Most of it is within commuting distance of Yerevan.
Most of it is within commuting distance of Yerevan.
Antonio Cardim Reis
TAP International intern
BA student Philosophy, Politics and Economics at St Hugh’s College,
Oxford University
BA student Philosophy, Politics and Economics at St Hugh’s College,
Oxford University
In Hrazdan, construction permeates every inch of pavement. A fresh grey apartment block tower stands on open ground, where the city thins out into hills. Concrete frames climb three and four storeys above the street: some still wrapped in scaffolding, others already fitted with glass. On a single walk through the town in September, countless projects were under active construction, from apartment blocks and shopfronts to a mall. Some of the sites had opened only days earlier.
"It's a small city, but we have everything here,"
says one of the local guides who led the walk.
"It's a small city, but we have everything here,"
says one of the local guides who led the walk.
A street with a mix of new and old construction projects, Hrazdan.
Six years ago, Urbanista found almost the opposite. Over the previous two decades, Armenia's marzes had received only 334 new multi-apartment buildings, according to regional administration data, and most of those were in the Shirak (163) and Lori (118) marzes, rebuilt after the 1988 earthquake. Construction outside Yerevan had roughly halved after the 2008 financial crisis. Spitak had seen essentially no new multi-apartment building since 2010.
The government has since promised to change that. In November 2023, it approved a 'Concept for the Decentralisation of Powers', and local government has been consolidated from around 915 communities to about 70. In 2019, Vahagn Vermishyan, then chairman of the Urban Development Committee, set a goal of reducing Yerevan's share of the population by five percentage points by 2050.
So, has anything changed?
The government has since promised to change that. In November 2023, it approved a 'Concept for the Decentralisation of Powers', and local government has been consolidated from around 915 communities to about 70. In 2019, Vahagn Vermishyan, then chairman of the Urban Development Committee, set a goal of reducing Yerevan's share of the population by five percentage points by 2050.
So, has anything changed?
The regions are building again
By one measure, yes. According to ARMSTAT, the total floor space of new dwellings completed in Armenia's ten marzes rose from 81,098 square metres in 2020 to 447,857 square metres in 2024: more than a fivefold increase.
Yerevan's share of new housing has fallen, too. In 2020, the capital accounted for 73% of all new dwelling space in the country. By 2023, it was 66%.
Yerevan's share of new housing has fallen, too. In 2020, the capital accounted for 73% of all new dwelling space in the country. By 2023, it was 66%.
Yerevan did not stop building either. In fact, the capital completed 561,182 square metres of new housing in 2023, two and a half times its 2020 figure. Rather, the marzes simply grew faster, from a lower starting point.
So, if 'decentralisation' is measured by where Armenia builds its homes, the numbers point to a slight movement away from the capital – a success for the government's plan. The harder question to answer is where exactly these figures point.
So, if 'decentralisation' is measured by where Armenia builds its homes, the numbers point to a slight movement away from the capital – a success for the government's plan. The harder question to answer is where exactly these figures point.
Most of it is next door
Most of the growth is in the marzes that border Yerevan.
Kotayk, which borders the capital to the north-east and includes Hrazdan, accounted for about half of all new dwelling space built in the marzes in 2020, 2023 and 2024. In 2023, it built more housing per head of population than Yerevan itself: 57,596 square metres per 100,000 residents, against the capital's 51,642. The timing matters, too. Kotayk's construction more than doubled between 2020 and 2021, two years before the decentralisation concept was approved.
Taken together, the four marzes bordering Yerevan – Kotayk, Ararat, Aragatsotn, and Armavir – accounted for 86% of new marz housing in 2020 and 93% in 2023.
Kotayk, which borders the capital to the north-east and includes Hrazdan, accounted for about half of all new dwelling space built in the marzes in 2020, 2023 and 2024. In 2023, it built more housing per head of population than Yerevan itself: 57,596 square metres per 100,000 residents, against the capital's 51,642. The timing matters, too. Kotayk's construction more than doubled between 2020 and 2021, two years before the decentralisation concept was approved.
Taken together, the four marzes bordering Yerevan – Kotayk, Ararat, Aragatsotn, and Armavir – accounted for 86% of new marz housing in 2020 and 93% in 2023.
Lori and Syunik sit at the other end of the scale. In 2024, Lori completed 3,109 square metres of housing per 100,000 residents, and Syunik 3,338: roughly 4% of Kotayk's rate.
Still, regional completions swing wildly from year to year – Shirak recorded 381 square metres in 2021 and 23,422 in 2024. In 2024, the marzes outside Yerevan's ring built 94,562 square metres, up from 22,185 the year before, and the four bordering marzes' share fell to 79%.
One year is not yet a trend, but it is a sign of potential change. Not all regional growth follows Yerevan's ring. Tavush marz, on the northern border, recorded the second-highest rate of new housing per head among the marzes in 2024, though it accounted for under 8% of marz construction. Its resort town, Dilijan, has drawn new money and development into remote-work offices, living spaces for digital nomads and an international school campus, UWC Dilijan, and that appears to account for much of Tavush's figure. It is growth of a different kind, dependent more on outside capital than on a local economy.
Still, regional completions swing wildly from year to year – Shirak recorded 381 square metres in 2021 and 23,422 in 2024. In 2024, the marzes outside Yerevan's ring built 94,562 square metres, up from 22,185 the year before, and the four bordering marzes' share fell to 79%.
One year is not yet a trend, but it is a sign of potential change. Not all regional growth follows Yerevan's ring. Tavush marz, on the northern border, recorded the second-highest rate of new housing per head among the marzes in 2024, though it accounted for under 8% of marz construction. Its resort town, Dilijan, has drawn new money and development into remote-work offices, living spaces for digital nomads and an international school campus, UWC Dilijan, and that appears to account for much of Tavush's figure. It is growth of a different kind, dependent more on outside capital than on a local economy.
"We enlarged Yerevan"
Sarhat Petrosyan, an urban planner who headed Armenia's Cadastre Committee in 2018–19 and founded the Yerevan think-tank Urban Lab, does not read the boom as decentralisation. Asked whether Armenia had decentralised since 2020, his answer is blunt: "No. We enlarged Yerevan, because now all the villages next to Yerevan have high-rises and became part of Yerevan."
Petrosyan traces the pattern back to housing policy. The government subsidised new residential development, he says, and when it moved to rein in construction in the capital, "we blocked Yerevan and allowed them to continue in the regions next to Yerevan."
In his view, Hrazdan, and the wider construction boom in Kotayk, Ararat, Aragatsotn, and Armavir, is part of that expansion. "The phenomenon of Hrazdan is that it is part of the metro area of Yerevan," he says. "The majority of people living in these communities, each day they commute to Yerevan to work." The bus from Yerevan to Hrazdan takes an hour.
Petrosyan traces the pattern back to housing policy. The government subsidised new residential development, he says, and when it moved to rein in construction in the capital, "we blocked Yerevan and allowed them to continue in the regions next to Yerevan."
In his view, Hrazdan, and the wider construction boom in Kotayk, Ararat, Aragatsotn, and Armavir, is part of that expansion. "The phenomenon of Hrazdan is that it is part of the metro area of Yerevan," he says. "The majority of people living in these communities, each day they commute to Yerevan to work." The bus from Yerevan to Hrazdan takes an hour.
A newly-constructed Hrazdan Apartment Block. It contains 104 apartments and will be finished in December of 2026.
That does not mean Hrazdan has no economy of its own. It hosts a multi-floor mall and supermarket, a variety of local stores, and Tetris, a children's entertainment centre, opened a few months ago: its staff is from Hrazdan, and one of its founders is local, according to locals Urbanista spoke with. The town's new 15-storey tower, with 104 apartments, began construction at the end of 2024 and is due to finish in December. Only about ten flats are still left to claim, the building's owner says, and two more like it are going up soon.
Yet even locals say most people work in Yerevan or the nearby Tsaghkadzor resort town, commuting from Hrazdan daily.
Yet even locals say most people work in Yerevan or the nearby Tsaghkadzor resort town, commuting from Hrazdan daily.
Tetris, a new children’s entertainment center in Hrazdan.
On the outskirts of town sits the new Firebird AI project, a fenced site flying US and Armenian flags. According to Firebird's website, it is a 500-megawatt, privately funded infrastructure project. Yet, Petrosyan doubts it is what's driving the town's growth: it has "like 100 employees max," he says, and "the reason it is there is because we have electricity there."
For Petrosyan, the problem with this kind of growth is less where it happens than what it lacks – infrastructure. "There are villages that don't have sewage systems, but they're building high-rises," he says. None of the rural communities have rainwater drainage, he adds. Schooling pulls families back to the capital, too: "Outside Yerevan, only in Dilijan is there one private school for the middle class."
Petrosyan is not against connecting other towns to Yerevan in principle. In fact, connection is his goal: to "live all over Armenia and meanwhile be connected with Yerevan." What he wants is more than one centre. "Having four or more cities with the same weight is the solution," he says. A town earns that kind of weight when its growth brings its own schools, services and jobs, and not only new residents who lean on the capital's existing infrastructure. Whether Hrazdan is moving in that direction is not yet fully clear.
Tigran Jrbashyan wants more than one centre too. A partner and director of management advisory services at Ameria, he advises on public-sector reform and says the firm has authored a large share of Armenia's strategy documents over the past decade. He holds no official government role, but co-designed the national employment strategy, which the government has adopted and has yet to implement. Like Petrosyan, he is not against connection in principle; the question is where it leads. His model is "people continuing to live in villages, but working in the regional cities' industrial zones," with the daily trip ending in a regional city rather than in Yerevan.
That depends on moving both sides of the labour market at once. Jrbashyan describes a structural mismatch: Yerevan is short of workers in many sectors, while the regions hold working-age people without jobs, or without the skills employers want. The strategy pairs training where people already live with incentives to move industry out to regional cities, through industrial zones. Do only one, he warns, and it backfires. Industry moved on its own would find no trained workforce. Training with no local jobs to go to would only speed the move to Yerevan.
For Petrosyan, the problem with this kind of growth is less where it happens than what it lacks – infrastructure. "There are villages that don't have sewage systems, but they're building high-rises," he says. None of the rural communities have rainwater drainage, he adds. Schooling pulls families back to the capital, too: "Outside Yerevan, only in Dilijan is there one private school for the middle class."
Petrosyan is not against connecting other towns to Yerevan in principle. In fact, connection is his goal: to "live all over Armenia and meanwhile be connected with Yerevan." What he wants is more than one centre. "Having four or more cities with the same weight is the solution," he says. A town earns that kind of weight when its growth brings its own schools, services and jobs, and not only new residents who lean on the capital's existing infrastructure. Whether Hrazdan is moving in that direction is not yet fully clear.
Tigran Jrbashyan wants more than one centre too. A partner and director of management advisory services at Ameria, he advises on public-sector reform and says the firm has authored a large share of Armenia's strategy documents over the past decade. He holds no official government role, but co-designed the national employment strategy, which the government has adopted and has yet to implement. Like Petrosyan, he is not against connection in principle; the question is where it leads. His model is "people continuing to live in villages, but working in the regional cities' industrial zones," with the daily trip ending in a regional city rather than in Yerevan.
That depends on moving both sides of the labour market at once. Jrbashyan describes a structural mismatch: Yerevan is short of workers in many sectors, while the regions hold working-age people without jobs, or without the skills employers want. The strategy pairs training where people already live with incentives to move industry out to regional cities, through industrial zones. Do only one, he warns, and it backfires. Industry moved on its own would find no trained workforce. Training with no local jobs to go to would only speed the move to Yerevan.
Where you cannot commute
"From Spitak you can't commute here," Petrosyan says. "So it's completely different."
Spitak, in Lori, is 90-120 minutes by road from Yerevan. It is a gorgeous drive of towering mountains and rolling hills, but it is not a quick or convenient one. Six years after Urbanista reported that multi-apartment construction there had stopped, little new or modern housing is visible. On a drive through the sprawling town in September, the only buildings under way were individual projects: a concrete-block house with a worker on its roof, and a cleared plot being dug by an excavator. Elsewhere, many concrete shells of private houses stand unfinished.
Spitak, in Lori, is 90-120 minutes by road from Yerevan. It is a gorgeous drive of towering mountains and rolling hills, but it is not a quick or convenient one. Six years after Urbanista reported that multi-apartment construction there had stopped, little new or modern housing is visible. On a drive through the sprawling town in September, the only buildings under way were individual projects: a concrete-block house with a worker on its roof, and a cleared plot being dug by an excavator. Elsewhere, many concrete shells of private houses stand unfinished.
- A half-finished construction project in Spitak.
- An abandoned construction site in Spitak.
- An active construction site in Spitak.
"Half-built houses are personal projects; it is private property, not government," Artak Matosyan, vice mayor of the Spitak Municipality, told Urbanista. "We do not know the reason why they are not finishing the buildings."
The official says the town has no housing programme for young families. "There were no central government projects for our town," he says. He also says a government social-apartments project began in 2021 and is still under way. Urbanista could not verify the project.
Asked whether attempts to spread the economy beyond Yerevan had reached Spitak, the municipal official keeps it short.
The official says the town has no housing programme for young families. "There were no central government projects for our town," he says. He also says a government social-apartments project began in 2021 and is still under way. Urbanista could not verify the project.
Asked whether attempts to spread the economy beyond Yerevan had reached Spitak, the municipal official keeps it short.
"We haven't had that in practice in our town."
What investment is visible in Spitak seems to be sourced from international aid, and goes into existing buildings. Plaques on apartment blocks record energy-efficiency renovations funded by the European Union, co-funded by the Spitak municipality and carried out by Habitat for Humanity Armenia. According to one plaque, the renovation of the Torosyan 11–23 buildings is expected to save 341.6 MWh of energy a year.
The housing market is thin. A young foreigner working in Spitak, who spent the summer looking for an apartment, found almost nothing listed on list.am, Armenia's main classifieds site. Instead, she relied on word of mouth and a local Facebook group. "The first place I ever saw was definitely below suitable standards, like covered in black mold," she says. Most of the flats she toured were in buildings put up by international aid after the earthquake. Heating dictates what people look for: "The goal is generally to find as small a place as you can, as opposed to bigger, so that you can comfortably heat it."
PICTURED: construction workers repave a central road in Spitak.
PICTURED (left and right): Placards referencing EU-funded projects
to renovate current Spitak housing.
PICTURED (left and right): Placards referencing EU-funded projects
to renovate current Spitak housing.
Distance from Yerevan is only one of Spitak's problems. Winters, heating costs, and a small local economy all weigh on the town. Petrosyan is blunt about the economy: "There is no industry: 2 or 3 small factories."
Jrbashyan sees that missing industry as the national problem. "It's not about rural areas," he says of Armenia's regional disparities. "It is about the regional cities." Soviet planners built up industry in those cities, sometimes artificially, by moving people in from the surrounding villages. When the Soviet Union's industrial links broke apart, "the major victims of this transition were the regional cities," he says, while Yerevan made up the loss with a growing service sector. Many people moved back to the villages and fell back on the land. Armenia privatised farmland early, and small plots carried families through the transition. As farming has modernised, those plots can no longer compete, and he estimates that around 120,000–130,000 agricultural jobs have gone in the past 10 to 12 years. With little industry left in the regional cities to take them in, people have moved to Yerevan or abroad. In his words, this is "a very rational response of the working population."
Still, not all is quiet in Spitak. In the last few weeks, several of the town's roads have been dug up and repaved in a local municipality project, according to Matosyan. "In the past thirty years we haven't seen anything like this," he told Urbanista.
Roads are where Jrbashyan would put regional money, though not these roads. Construction investment in the regions, he argues, should go into links between villages and their regional city rather than into new housing. In some regional cities, Soviet-era housing already stands empty. By his account, getting from a village to its nearest regional city can be harder than getting from that city to Yerevan, and sometimes impossible. "We have not even managed... to understand the conditions of the roads linking the villages with the regional cities," he says. "The only way to go places in most villages is by hiring a taxi, or your own car." Spitak's repaving is on the town's own roads, not the village-to-town network he describes.
Jrbashyan sees that missing industry as the national problem. "It's not about rural areas," he says of Armenia's regional disparities. "It is about the regional cities." Soviet planners built up industry in those cities, sometimes artificially, by moving people in from the surrounding villages. When the Soviet Union's industrial links broke apart, "the major victims of this transition were the regional cities," he says, while Yerevan made up the loss with a growing service sector. Many people moved back to the villages and fell back on the land. Armenia privatised farmland early, and small plots carried families through the transition. As farming has modernised, those plots can no longer compete, and he estimates that around 120,000–130,000 agricultural jobs have gone in the past 10 to 12 years. With little industry left in the regional cities to take them in, people have moved to Yerevan or abroad. In his words, this is "a very rational response of the working population."
Still, not all is quiet in Spitak. In the last few weeks, several of the town's roads have been dug up and repaved in a local municipality project, according to Matosyan. "In the past thirty years we haven't seen anything like this," he told Urbanista.
Roads are where Jrbashyan would put regional money, though not these roads. Construction investment in the regions, he argues, should go into links between villages and their regional city rather than into new housing. In some regional cities, Soviet-era housing already stands empty. By his account, getting from a village to its nearest regional city can be harder than getting from that city to Yerevan, and sometimes impossible. "We have not even managed... to understand the conditions of the roads linking the villages with the regional cities," he says. "The only way to go places in most villages is by hiring a taxi, or your own car." Spitak's repaving is on the town's own roads, not the village-to-town network he describes.
A bigger capital
On a key measure, construction, Armenia is decentralising, albeit only a little. The marzes completed more than five times as much new housing in 2024 as in 2020, and Yerevan's share of the country's new homes fell from 73% to 66% between 2020 and 2023. But most of that housing went up in the marzes around the capital, in towns whose residents, by Petrosyan's and locals' accounts, still travel into Yerevan to work. Petrosyan says the rural communities around the capital are putting up high-rises without the infrastructure to support them, from sewage to drainage. Whether Hrazdan's own infrastructure is keeping pace is not yet clear. Hrazdan now has a mall, an entertainment centre and a 15-storey tower due to finish in December, with many more sites under construction across town. What it does not yet have is what would make it one of Petrosyan's "four or more cities with the same weight."
A road sign in central Hrazdan.
Jrbashyan would measure it differently. In his view, housing is not where regional investment should go, and so not where to look for progress. His test is whether industrial zones get built in regional cities, which he says the government now treats as a priority. That would be "the first major indicator that the country is moving from the current concentrated structure around Yerevan." Hrazdan has a mall and a tower, but neither is an industrial zone.
Further out, the picture is less settled. In Spitak, the money that does arrive goes into renovating existing apartment blocks, funded by the European Union and co-funded by the municipality, and into repaving roads, while what building does happen is haphazard, coming one family and one house at a time and often left half-finished.
At a junction in the centre of Hrazdan, a blue road sign points the way to Yerevan. For now, that is the direction the country's new housing faces.
Further out, the picture is less settled. In Spitak, the money that does arrive goes into renovating existing apartment blocks, funded by the European Union and co-funded by the municipality, and into repaving roads, while what building does happen is haphazard, coming one family and one house at a time and often left half-finished.
At a junction in the centre of Hrazdan, a blue road sign points the way to Yerevan. For now, that is the direction the country's new housing faces.