No repository The repository for this project does not exist when creating project using templates

Summary

Creating new projects from custom group-level templates no longer works correctly. The project is created, but the repository is missing and template settings are not applied. This functionality worked previously but recently stopped working

Steps to reproduce

Navigate to New Project → Create from template. Select a custom group-level template. Click Create project. Observe that the project is created without a repository or applied template settings.

Example Project

N/A – this is reproducible with any custom group-level template on our self-hosted GitLab instance.

What is the current bug behavior?

Project creation succeeds (confirmation message appears). The repository is missing (UI shows "No repository"). Template settings are not applied.

What is the expected correct behavior?

The project should be created with a repository initialized. The repository should inherit settings from the chosen template.

Relevant logs and/or screenshots

After creation, the UI shows: '''Project '' was successfully created. No repository The repository for this project does not exist. This means you cannot push code until you create an empty repository or import an existing one.'''

Output of checks

This bug happens on self-hosted GitLab version 18.2.2.

Troubleshooting steps already taken

Verified template configuration and permissions. Attempted project creation with different templates and different users. Checked GitLab documentation for template setup. Tried initializing repository with README manually post-creation.