Project.repository should never be nil so you can call repository.exists? or repository.empty?

Also specify separate project factory for project with filled repo

app/helpers/application_helper.rb

@@ -96,7 +96,7 @@ module ApplicationHelper
     ]
 
     project_nav = []
-    if @project && @project.repository && @project.repository.root_ref
+    if @project && @project.repository.exists? && @project.repository.root_ref
       project_nav = [
         { label: "#{simple_sanitize(@project.name_with_namespace)} - Issues",   url: project_issues_path(@project) },
         { label: "#{simple_sanitize(@project.name_with_namespace)} - Commits",  url: project_commits_path(@project, @ref || @project.repository.root_ref) },

app/models/project.rb

@@ -141,13 +141,7 @@ class Project < ActiveRecord::Base
   end
 
   def repository
-    if path
-      @repository ||= Repository.new(path_with_namespace, default_branch)
-    else
-      nil
-    end
-  rescue Gitlab::Git::NoRepository
-    nil
+    @repository ||= Repository.new(path_with_namespace, default_branch)
   end
 
   def saved?
@@ -332,14 +326,14 @@ class Project < ActiveRecord::Base
   end
 
   def valid_repo?
-    repo
+    repository.exists?
   rescue
     errors.add(:path, "Invalid repository path")
     false
   end
 
   def empty_repo?
-    !repository || repository.empty?
+    !repository.exists? || repository.empty?
   end
 
   def ensure_satellite_exists
@@ -363,7 +357,7 @@ class Project < ActiveRecord::Base
   end
 
   def repo_exists?
-    @repo_exists ||= (repository && repository.branches.present?)
+    @repo_exists ||= repository.exists?
   rescue
     @repo_exists = false
   end

app/models/repository.rb

@@ -3,6 +3,16 @@ class Repository
 
   def initialize(path_with_namespace, default_branch)
     @raw_repository = Gitlab::Git::Repository.new(path_with_namespace, default_branch)
+  rescue Gitlab::Git::Repository::NoRepository
+    nil
+  end
+
+  def exists?
+    raw_repository
+  end
+
+  def empty?
+    raw_repository.empty?
   end
 
   def commit(id = nil)

app/views/projects/_clone_panel.html.haml

@@ -4,7 +4,7 @@
       .form-horizontal= render "shared/clone_panel"
     .span4.pull-right
       .pull-right
-        - unless @project.empty_repo?
+        - if @project.empty_repo?
           - if can? current_user, :download_code, @project
             = link_to archive_project_repository_path(@project), class: "btn-small btn grouped" do
               %i.icon-download-alt