diff --git a/pungi/paths.py b/pungi/paths.py
index ce5a777a..1183b93c 100644
--- a/pungi/paths.py
+++ b/pungi/paths.py
@@ -530,10 +530,6 @@ class ComposePaths(object):
         @param symlink_to=None
         @param relative=False
         """
-        # skip optional and addons
-        if variant.type != "variant":
-            return None
-
         path = os.path.join(self.topdir('%(arch)s', variant, create_dir=False, relative=relative),
                             "images")
         if symlink_to:
diff --git a/pungi/phases/image_build.py b/pungi/phases/image_build.py
index 07605e57..b1d0f878 100644
--- a/pungi/phases/image_build.py
+++ b/pungi/phases/image_build.py
@@ -28,6 +28,11 @@ class ImageBuildPhase(base.PhaseLoggerMixin, base.ImageConfigMixin, base.ConfigG
         current variant. If the config is set, it will be removed from the
         dict.
         """
+        if variant.type != 'variant':
+            # Buildinstall only runs for top-level variants. Nested variants
+            # need to re-use install tree from parent.
+            variant = variant.parent
+
         install_tree_from = image_conf.pop('install_tree_from', variant.uid)
         if '://' in install_tree_from:
             return install_tree_from
diff --git a/tests/helpers.py b/tests/helpers.py
index 53e3898d..ed78c9d0 100644
--- a/tests/helpers.py
+++ b/tests/helpers.py
@@ -89,8 +89,8 @@ class DummyCompose(object):
 
     def setup_optional(self):
         self.all_variants['Server-optional'] = MockVariant(
-            uid='Server-optional', arches=['x86_64'], type='optional', is_empty=False,
-            parent=self.variants['Server'])
+            uid='Server-optional', arches=['x86_64'], type='optional', is_empty=False)
+        self.all_variants['Server-optional'].parent = self.variants['Server']
         self.variants['Server'].variants = {'optional': self.all_variants['Server-optional']}
 
     def get_variants(self, arch=None, types=None):
diff --git a/tests/test_imagebuildphase.py b/tests/test_imagebuildphase.py
index 609dcb38..5f753cfd 100644
--- a/tests/test_imagebuildphase.py
+++ b/tests/test_imagebuildphase.py
@@ -564,6 +564,66 @@ class TestImageBuildPhase(PungiTestCase):
         self.assertEqual(args[0][1]['image_conf'].get('image-build', {}).get('ksurl'),
                          resolve_git_url.return_value)
 
+    @mock.patch('pungi.phases.image_build.ThreadPool')
+    def test_image_build_optional(self, ThreadPool):
+        compose = DummyCompose(self.topdir, {
+            'image_build': {
+                '^Server-optional$': [
+                    {
+                        'image-build': {
+                            'format': [('docker', 'tar.xz')],
+                            'name': 'Fedora-Docker-Base',
+                            'target': 'f24',
+                            'version': 'Rawhide',
+                            'ksurl': 'git://git.fedorahosted.org/git/spin-kickstarts.git',
+                            'kickstart': "fedora-docker-base.ks",
+                            'distro': 'Fedora-20',
+                            'disk_size': 3,
+                            'failable': ['x86_64'],
+                        }
+                    }
+                ]
+            },
+            'koji_profile': 'koji',
+        })
+        compose.setup_optional()
+
+        self.assertValidConfig(compose.conf)
+
+        phase = ImageBuildPhase(compose)
+
+        phase.run()
+
+        # assert at least one thread was started
+        self.assertTrue(phase.pool.add.called)
+        server_args = {
+            "format": [('docker', 'tar.xz')],
+            "image_conf": {
+                'image-build': {
+                    'install_tree': self.topdir + '/compose/Server/$arch/os',
+                    'kickstart': 'fedora-docker-base.ks',
+                    'format': 'docker',
+                    'repo': self.topdir + '/compose/Server-optional/$arch/os',
+                    'variant': compose.all_variants['Server-optional'],
+                    'target': 'f24',
+                    'disk_size': 3,
+                    'name': 'Fedora-Docker-Base',
+                    'arches': 'x86_64',
+                    'version': 'Rawhide',
+                    'ksurl': 'git://git.fedorahosted.org/git/spin-kickstarts.git',
+                    'distro': 'Fedora-20',
+                }
+            },
+            "conf_file": self.topdir + '/work/image-build/Server-optional/docker_Fedora-Docker-Base.cfg',
+            "image_dir": self.topdir + '/compose/Server-optional/%(arch)s/images',
+            "relative_image_dir": 'Server-optional/%(arch)s/images',
+            "link_type": 'hardlink-or-copy',
+            "scratch": False,
+            "failable_arches": ['x86_64'],
+        }
+        self.assertItemsEqual(phase.pool.queue_put.mock_calls,
+                              [mock.call((compose, server_args))])
+
 
 class TestCreateImageBuildThread(PungiTestCase):