24 February 2013

Ethiopia: Controversy Over Condominium Delays

A building, which is under construction by Tedros Abebe Construction has reached the 40.06pc mark at the Bole Ayat Condominium site.

The condominium construction site at Legetafo Square in Bole District was quiet when Fortune visited on the afternoon of Tuesday, February 19, 2013.

There are 138 buildings with 2,208 housing units at the site, officially known as Bole Ayat. These are part of the 83,895 units whose construction began in the city in 2010/11, with the intention of being completed within 10 months.

Construction is several months overdue. Only 20,000 units have reached the 80pc completion mark that allows them to officially be considered as finished; these were inaugurated on Saturday, February 23, 2013.

Each of the buildings was given to one contractor, with no contractor having more than one building. GET Consultant Company was given the task of supervising the construction and providing a weekly assessment report on the progress.

Two weeks ago, 10 months past the deadline, only two contractors had completed 90pc of the construction; 16 were less than half way through, whilst the remaining 120 were between 50pc and 90pc of completion.

A contractor for one of the buildings that has not been able to reach the 50pc mark has been in the business for the past 13 years. Requesting anonymity, the contractor said that his company had built four condominium buildings since 2005, and currently has a second project at the Ayat Abado site.

He won the contract for the two buildings at two different sites 28 months ago, with an agreement to deliver at a deadline that is long past.

The anonymous contractor started work on the fourth floor of his project at Legetafo in January. Seventy-four buildings are slightly ahead of him and are ready for roofing. But, they too are not without problems.

Fortune met Birhanu Belay, general manager of Getachew Construction, as he was leaving the project site and heading home at 10 in the morning. He complained that he has been idle for the past three months, waiting for the roof to be built, so that he can carry out the finishing work.

"I am going home because there is nothing for me to do," he said.

Roof installation for this particular condominium was tasked to Girma & Hiwot Enterprise, a small husband and wife company, three months ago.

"How can we start construction without money to pay our daily labourers," said Girma Mulubrehan, "We are a small enterprise and we need cash for all of our activities."

Different parties at different stages of construction have varying reasons for the delay.

Buildings under the Kolfe District administration have almost reached completion, although they began at the same time as the Bole Ayat Condominiums.

The unidentified contractor believes the reason for the delay to be the lack in supply of construction materials, alongside management problems. Supplies are either poorly distributed from stores or are not available at all, he says.

Addis, a manager at the site, who declined to give his full name, says that construction had ceased for six months last year because he was unable to obtain precast concrete elements; he needed 58 to start work on the fourth storey of a building, but he could get only 53.

"I cannot name any material that is available in large quantities at the site," he added.

During the six month standstill, contractors were not getting any money, he said, but they had to keep paying for night-watchmen and warehouse guards. In the meantime, the price of construction materials was increasing and daily labour wages went up from 40Br a day when construction started, to 80Br, according to Addis.

The Addis Abeba Housing Agency provides cement, reinforcement bars, and electrical and plumbing materials to contractors through project offices, which are set up at each project site. The project offices provide all other materials, except for sand, which is the responsibility of each individual contractor.

The Addis Abeba Housing Agency denies accusations that they are not supplying materials.

"We are providing materials and money on time to the districts," says Eshetu Lemessa, construction inputs supply sub-process leader at the Agency.

Yidnekachew Baladin, general manager of the Agency, however, at a press conference held on February 19, 2013, admitted to importing 101,000tn of reinforcement bars during a shortage in 2011/12.

Eshetu blames the delay on the project offices.

"If we met with the branch offices to discuss the issue, I am sure they would not deny that we are supplying them according to their needs," he said.

The Agency has so far procured only 40,000ql of cement, from a total of 120,000ql, offered for sale by Muger Cement.

"This is a sign that there is no shortage." Eshetu said. "There is plenty of supply."

The Agency has assigned officials to each project office who meet to discuss the progress of the projects. The officials claim that the problem also rests with contractors who neglect their commitments when they get new projects.

"The problem is with contractors and not the supply of materials," said an officer at the Bole Ayat Project. "Why then have other contractors reached completion?" he asked.

One such contractor, Tedros Abebe, who has completed 91.2pc of his work at Bole Ayat, counters the official's argument. He progressed this far because he used his own resources when he incurred delays in delivery from the project office, he says.

"We are hearing complaints from both contractors and enterprises, which we believe should be handled by the project offices," stated the head of the Housing Department in Bole District.

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