18 October 2010

Ethiopia: Flintstone Shells Out 11.1 Million Br for Lideta Plot

Flintstone Engineering won the tender to lease a 1,848.96sqm plot in Lideta District, one of the seven plots the Land Administration and Build Permit Authority of the Addis Abeba City Administration has floated for the third time, with an offer of 11.1 million Br on Wednesday, October 13, 2010, to construct luxurious condominium houses.

The City Administration failed to attract bidders for the total 2.3ht, apportioned into seven plots, which it had put up for tender on two previous occasions. The third tender that was floated on September 25, saw seven bidders, including Flintstone, for the one plot; a sole bidder, Yetebaberut Petroleum, for another plot; and none for the rest.

The offer made by Yetebaberut Petroleum was rejected because there has to be at least three bidders, according to the lease directive.

Flintstone came out the winner with a bid of 6,020 Br per square metre for the 1,848.96sqm plot, of which the minimum bid was 1,051.88 Br per square metre, for a lease of 50 years. The company is expected to pay 20pc of the bid within 10 days of signing the contract and the rest over 20 years after a two-year grace period, according to the bid document. It is also expected to put a 2.6 million Br performance bond in a blocked account until it has completed construction to the amount's worth.

"This is to ensure that developers who take land actually go through with their planned projects," Halewe Kedir, an officer in the Lideta District Land Lease Transfer Office, told Fortune.

Each of these plots, located on the main road in front of Lideta Church and Lideta High Court, is meant for commercial buildings and is available on a 50-year lease.

"We are going to construct two blocks with up to 70 units of luxury condominiums with shop space on the ground floor," Tsedeke Yehune (Eng), owner of Flintstone Engineering, told Fortune. "The seven-storey blocks are projected to cost 85 million Br and are expected to be finished within two years."

Although Flintstone, which was established in 1991 with 5,000 Br capital, has not yet determined how much to charge for the condominiums, it will not be as cheap as other condominium housing, according to Tsedeke.

The company, which has increased its registered capital to one million Birr since its establishment, plans to select consultants to design the condominiums and to offer them for sale once the working design has been finalised.

A total of 26ht of land have been cleared in Lideta District, out of which 5.45ht have been leased to 81 developers, including banks, business people, and residents of the area. Awash International (AIB) and Dashen banks have leased 2,800sqm and 2,696sqm, respectively.

More than 2,600 residential units, shops, cafés, and restaurants, of which the vast majority were in kebele owned houses, have been demolished to clear the site. The city is undertaking the construction of condominiums with 2,300 housing units at a cost of 200 million Br in which residents whose houses have been demolished are to be resettled. In addition, 88 million Br has been given to more than 300 private home owners as compensation.

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