diff --git a/devops/devops/controller.py b/devops/devops/controller.py
index 743475fff..b161d0710 100644
--- a/devops/devops/controller.py
+++ b/devops/devops/controller.py
@@ -56,6 +56,7 @@ class Controller:
             for interface in node.interfaces:
                 interface.node = node
                 interface.network.interfaces.append(interface)
+                logger.info("Calculated interfaces '%s' '%s'" % (interface.node, interface.network.name))
 
             for disk in node.disks:
                 if disk.base_image and disk.base_image.find('://') != -1:
@@ -84,27 +85,23 @@ class Controller:
                     for address in interface.ip_addresses:
                         if address in network.ip_addresses:
                             allocated_addresses.append(address)
-
-                next_address_index = 2
+                logger.info("Allocate addresses are calculated for '%s'" % network.name)
+                dhcp_allowed_addresses = list(network.ip_addresses)[2:-2]
                 for interface in network.interfaces:
-                    if not len(interface.ip_addresses):
-                        while next_address_index < network.ip_addresses.numhosts and\
-                              network.ip_addresses[
-                              next_address_index] in allocated_addresses:
-                            next_address_index += 1
-
-                        if next_address_index >= network.ip_addresses.numhosts:
-                            raise DevopsError, "Failed to allocated IP address for node '%s' in network '%s': no more addresses left" % (node.name, network.name)
-
-                        address = network.ip_addresses[next_address_index]
+                    logger.info("Enumerated interfaces '%s' '%s'" % (interface.node, interface.network.name))
+                    logger.info(list(interface.ip_addresses))
+                    if not len(list(interface.ip_addresses)):
+                        address = self.get_first_free_address(
+                            dhcp_allowed_addresses,
+                            allocated_addresses)
+                        if address is None:
+                            raise DevopsError, "Failed to allocate IP address for node '%s' in network '%s': no more addresses left" % (interface.node.name, network.name)
                         interface.ip_addresses.append(address)
-                        allocated_addresses.append(next_address_index)
-                        next_address_index += 1
+                        logger.info("Allocate IP address '%s' for node '%s' in network '%s'" % (address, interface.node.name, network.name))
+                        allocated_addresses.append(address)
 
-                network.dhcp_dynamic_address_start = network.ip_addresses[
-                                                     next_address_index]
-                network.dhcp_dynamic_address_end = network.ip_addresses[
-                                                   network.ip_addresses.numhosts - 2]
+                network.dhcp_dynamic_address_start = dhcp_allowed_addresses[0]
+                network.dhcp_dynamic_address_end = dhcp_allowed_addresses[-1]
 
         for network in environment.networks:
             logger.info("Building network %s" % network.name)
@@ -303,3 +300,9 @@ class Controller:
 
         return cached_path
 
+    def get_first_free_address(self, allowed_addresses, allocated_addresses):
+        s = set(allocated_addresses)
+        for x in allowed_addresses:
+            if x not in s:
+                return x
+        return None
diff --git a/devops/devops/driver/libvirt.py b/devops/devops/driver/libvirt.py
index 9ca8ce91d..287393eda 100644
--- a/devops/devops/driver/libvirt.py
+++ b/devops/devops/driver/libvirt.py
@@ -70,11 +70,11 @@ class LibvirtXMLBuilder:
                         else:
                             end = network.ip_addresses[
                                 network.ip_addresses.numhosts - 2]
-
+                        allowed_addresses = list(network.ip_addresses)[2: network.ip_addresses.numhosts - 2]
                         network_xml.range(start=str(start), end=str(end))
                         for interface in network.interfaces:
                             address = find(
-                                lambda ip: ip in network.ip_addresses,
+                                lambda ip: ip in allowed_addresses,
                                 interface.ip_addresses)
                             if address and interface.mac_address:
                                 network_xml.host(
@@ -282,11 +282,12 @@ class Libvirt:
         process.wait()
         if process.returncode:
             logger.error(
-                "Command '%s' returned %d, stderr: %s" % (
-                command, process.returncode, process.stderr.read()))
+                "Command '{0:>s}' returned {1:d}, stderr: {2:>s}".format(
+                    command, process.returncode, process.stderr.read()))
         else:
             logger.debug(
-                "Command '%s' returned %d" % (command, process.returncode))
+                "Command '{0:>s}' returned {1:d}".format(command,
+                    process.returncode))
 
         snapshot_ids = []
         for line in process.stdout.readlines()[2:]:
@@ -389,8 +390,7 @@ class Libvirt:
         process.wait()
         if process.returncode:
             logger.error(
-                "Command '%s' returned code %d:\n%s" % (
-                    command,
+                "Command '{0:>s}' returned code {1:d}:\n{2:>s}".format(command,
                     process.returncode,
                     process.stderr.read()))
             raise LibvirtException, "Failed to execute command '%s'" % command
diff --git a/devops/devops/model.py b/devops/devops/model.py
index fcdc25677..a67077787 100644
--- a/devops/devops/model.py
+++ b/devops/devops/model.py
@@ -1,10 +1,15 @@
 from itertools import chain
 
 
+class EnvironmentException(object):
+    pass
+
+
 class ManagedObject(object):
     def __init__(self):
         super(ManagedObject, self).__init__()
         self._driver = None
+        self.name = None
 
     @property
     def driver(self):
@@ -154,7 +159,8 @@ class Disk(object):
 
 
 class Interface(ManagedObject):
-    def __init__(self, network, ip_addresses=[]):
+    def __init__(self, network, ip_addresses=None):
+        if not ip_addresses: ip_addresses = []
         self.node = None
         self.network = network
         if not isinstance(ip_addresses, (list, tuple)):