R-R REAL ESTATE PLC

Project Proposal and Feasibility Study for

Real-Estate Apartment Building

Addis Ababa, Ethiopia

2024

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 Table of Contents

1. INTRODUCTION.....................................................................................................................2

1.1. What Is Real Estate?.........................................................................................................................2

1.2. Real Estate in Ethiopia......................................................................................................................2
1.3 Company Profile of R-R Real Estate...................................................................................................3
1.3.1 R-R General Contractor’.............................................................................................................3
1.3.2. About project promoter..............................................................................................................4
1.3.3 Company’s vision, mission & values..........................................................................................5
1.4 Objectives of the Project...................................................................................................................7
1.4.1 General Objective.......................................................................................................................7
1.4.2. Specific objective.......................................................................................................................7
1.5 The significance of the project...........................................................................................................7
1.5.1 Contribute to resolve shortage of residential houses.................................................................8
1.5.2 Source of Revenue......................................................................................................................8
1.5.3 Employment opportunity............................................................................................................8
1.6. Physical Characteristic of Project Area.............................................................................................8
1.6.1. District Location of project Area...............................................................................................8
1.6.2 Distance from project Area to Addis Ababa land mark..............................................................8
1.6.3 Climate around Project Area.......................................................................................................9
1.6.4 Education and Other Services on Project Area...........................................................................9
1.6.5 Road and Transport...................................................................................................................10
2. MARKET STUDY...................................................................................................................11

2.1. Market Analysis..............................................................................................................................11

2.2 Demand and Supply Gap.................................................................................................................12
2.3. Marketing Promotion and Strategy................................................................................................13
2.4. Competition Analysis with Competitors Real Estate Company.......................................................13
2.5. The Project Description..................................................................................................................14
3. TECHNICAL STUDY.............................................................................................................17

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 3.1. Description of the Project Service/ Product Mix.............................................................................17
3.2. Construction Schedule....................................................................................................................17
3.3. Architectural Design & Layout........................................................................................................18
3.4. Structural Design............................................................................................................................18
3.5. Reinforced Concrete.......................................................................................................................19
3.6. Foundation Design..........................................................................................................................19
3.7. Construction Plan and process.......................................................................................................19
3.8. Utilities............................................................................................................................................20
3.9. Project Implementation..................................................................................................................20
4. ORGANIZATIONAL STRUCTURE....................................................................................21

4.1. Organization Structure and Management......................................................................................21

5. FINANCIAL REQUIREMENT AND ANALYSIS..............................................................22

5.1. Projected Review............................................................................................................................23

5.2 Investment Cost And Financing.......................................................................................................23
5.3 Profitability Forecast........................................................................................................................23
6. APARTMENT PRICE.........................................................................................................24

6.1 Apartment Price for other Hiya real estate customer and for zemzam bank..................................24
7. SOCIO-ECONOMIC BENEFITS.........................................................................................27

8. CONCLUSIONS AND RECOMMENDATIONS.................................................................28

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1. INTRODUCTION

1.1. What Is Real Estate?

Real state is a private property in the form of buildings and land. Real estate can be used for
residential, commercial, or industrial purposes, and includes any resources on the land such as
water or mineral. Real estate is one of the most valuable a person owns, and the value of estate is
a key indicator of an economy’s health. On the deeper thought, real estate is a legal term
designating the rights of someone has to land and buildings. Most cases, real estate composed
land plus real property, as define by the local ordinances in which the real estate exists. Land or
real property that is not personally owned is not considered real estate. Real estate is a real
property that consists of land and improvements, which include buildings, fixtures, roads,
structures, and utility systems.

1.2. Real Estate in Ethiopia/AA

Ethiopia has a population of 115 million. Using its unique forecasting and business intelligence
tool predicts the population will increase by 26% and reach 145 million by 2030. This increase in
population will boost the demand for additional homes with 20-30-year- olds entering the
housing market. Ethiopia will require an additional 900,000 new homes, ignoring current
deficits, to meet the demand over the next decade.

Investment and property development play an important role in any emerging markets or
economies. Property generally comprises reside vial houses and commercial real estate property
(mainly mixed us building) developed for rental business and sale. The property investment
market in Ethiopia remained under developed for several years. As a consequence, the supply of
residential houses and non-residential real estate that can be used for residence, office space,
shopping malls and catering services in the urban centers of the country is disproportionately low
to cope with the growing demand in the country spinning from the average growth in GDP of 5.5
percent over the last ten years and population increase. The relatively good performance of the
macro-economy (real growth in GDP, investment and export sector) has stimulated

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unprecedented investment growth in the property sector over the last five years. The growth of
investment in the property market over the last five years in consistent with the global experience
suggesting that investment in the residential and commercial property (real estate) is greatly
influenced by the performance of the macroeconomic conditions. In general, a stable
macroeconomic condition leads to economic and business growth and develops investors’
confidence.
The current fast and dynamic economic growth of Ethiopia especially in Addis Ababa
necessitates equivalent growth of building and construction sector. The sector should expand
rapidly to support the overall economic development sustainable. In the building sector of the
economy, the residential use is the one becoming rapidly expanding in Addis Ababa since
dynamic economic development of urban economy requires the construction of these buildings
in the city to support the growing demand of residential houses. Investment and property
development play an important role in any emerging markets or economies. Property generally
comprises residential houses and commercial real estate, property developed for rental business
and for sale.

1.3 Company Profile of R-R Real Estate

1.3.1 R-R General Contractor’
‘R-R is established before many years to engage in construction sector at capacity of General
contractor. Pooling the financial resources from his long lasting construction business, now, the
contractor is engaged real estate development. So far, the developer has completed and delivered
three sites within agreed upon date to his esteemed customers. Looking the untapped demand for
the real estate market investing liquid assets in residential real estate can indeed involve
converting liquid assets which are sensitive to inflation into property, offering potential long-
term benefits such as rental income and property appreciation.

1.3.2. About project promoter

The project promoter, R-R General CONTRACTOR, is established by Ethiopian national Ms. R-R
before years among others to engage in construction service at General contractor capacity. He
has been working for many years with NGOs, and UN agency projects. Sourcing his equity from

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the existing construction business, now, he is investing in real estate development. So far, he has
completed three real estate as scheduled. Looking the untapped demand for the residential and
commercial buildings he is now developing two mixed use buildings located at different ideal
locations here in Addis Ababa

 Name: R-R GENERAL CONTRACTOR Form of business: Sole proprietorship

 Manager: Owner- R-R
 Address: A/A, Bole Sub City, Woreda 05 ,H. No. 141, tel 911-216-060
 TIN:
 Project Type: Residential Use Buildings
 Investment Capital=
 Project financing ****% equity and ***% apartment Buyers

1.3.3 Company’s vision, mission & values

Vision:
 "To revolutionize the real estate industry by providing innovative and sustainable
solutions that enhances communities and empowers individuals to achieve their dreams
of homeownership.
"Mission:
 "Our mission is to exceed client expectations by delivering exceptional service,
leveraging cutting-edge technology, and fostering a culture of integrity, professionalism,
and excellence in everything we do.
 "Values:
 Integrity: We operate with honesty, transparency, and accountability in all our
interactions.
 Client-Centricity: We prioritize our clients' needs and strive to deliver personalized
solutions tailored to their unique requirements.
 Innovation: We embrace innovation and continually seek new ways to improve
processes, services, and technologies.

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  Excellence: We are committed to delivering the highest quality service and results,
striving for excellence in every aspect of our business.
 Collaboration: We believe in the power of collaboration and foster a supportive
environment where teamwork and mutual respect are valued.
 Sustainability: We are dedicated to promoting environmental sustainability and
integrating eco-friendly practices into our operations and developments.

Complete and ongoing projects by Hiya Real Estate

NO Project Descrbtion Design Image Actual Image

1 Location: - Haile garment
Building type: - G+9 Mixed Used Building
Construction Progress: - 100% Completed

2 Location: - Haile Garment

Building type: - G+12 residential Building
Construction Progress: - 80% Completed

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 3 Location: - BHaile Garment
Building type: - B+G+11 Residential Building
Construction Progress: - 100% Completed

4 Location: - Adama city

Building type: - B+G+10 Residential Building
Construction Progress: - 30% Completed

1.4 Objectives of the Project

1.4.1 General Objective

The major goal of this project is to contribute towards the growth of the trade sector and
residential problem in Addis Ababa.

1.4.2. Specific objective

 Reduce the housing supply problem in the capital Addis Ababa

 To undertake trading and other refuted business activities that enable to generate a
reasonable to the invested capital.
 To create employment opportunities.
 Contribute towards the beautification of the city through the construction of modern
building infrastructure and facilities.
 To establish economically viable, socially acceptable and environmentally friend
residential use building.

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1.5 The significance of the project
The envisaged projects deemed to add to the economic development of the city in general in
specific with following ways:

1.5.1 Contribute to resolve shortage of residential houses

The housing problem in the capital is one of the acute problems the residents are suffering. The
problem is evidenced by the number of names in the condominium registration list of the
municipality and the number of population who are living is slum houses. This project is a plus
for the cities effort of resolving the housing problem at least for those who can afford to pay.

1.5.2 Source of Revenue

As public policy of any nation, the government collects different forms of taxes from different
business organizations and individuals. Among the different forms of taxes, business income
taxes, payroll income tax and VAT are collected from undertaking business activities. Therefore,
the building will serve as sources of revenue for the city.

1.5.3 Employment opportunity

One of the problems that our country faced is unemployment. Therefore, the current objective of
the government is working on tackling the problem of unemployment and fostering the
development process either through creating self-employment or employment in other
organization. Hence, this project will hire permanent employee and temporary employee during
construction directly. Indirect employment opportunities from the tenants businesses are also a
benefit.

1.6. Physical Characteristic of Project Area

1.6.1. District Location of project Area
The project location located Addis Ababa city administration, Kirkos sub city infront Dandi
boru Schhol at map coordinates Latitude .8059’33.6’’N Longitude and 38o 46’ 20.3’’ east.

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1.6.2 Distance from project Area to Addis Ababa land mark

The distance from the project area to other location is basic concept for real estate selling price.
There is some landmark place like airport, hotels and headquarters of international institutions.

No Destination Distance(km) Driving Time

1 Bole international Airport 4.1Km 14min

2 Sheraton Addis hotel 4.5Km 13min
3 African union head quarter 4.7 Km 13min
4 4kilo National palace 5.4Km 14min
5 Addis Ababa stadium 3.4Km 11min
6 Kirkos sub city 2.7Km 8 min
7 Addis Ababa city Administration 6.8 Km 17 min
8 Meskel Square 3 Km 11min
9 Zamzam Bank 2.0 Km 6 min
10 Ethio China Street 2.0Km 6 min
Table: Distance from the project area to city landmark

1.6.3 Climate around Project Area

The project area has a complex mix of highland climate zones, with temperature differences of
up to 10 °C (18 °F), depending on elevation and prevailing wind patterns. The high elevation
moderates temperatures year-round, and temperatures are very constant from month to month.
As such the climate would be meantime if its elevation was not taken into account, as no month
is above 22 °C (72 °F) in mean temperatures.

1.6.4 Education and Other Services on Project Area

Around project area hosts the different academic center that provides children with a higher
standard of learning activities like dandii Boru School. There are different financial institutes

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including Ethiopian commercial bank and there is known hotel and restaurants are available such
as Nekhla restaurant.

1.6.5 Road and Transport

The project area near by The Ring Road which was initiated in 1998 to implement the city
master plan and enhance peripheral development and also there are different square which is
welosefer round about square. The main roads are Ethio China Street. On the other hand Public
transport is through public buses, or blue white taxis and minibus transport can get within
walking distance from project area.

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2. MARKET STUDY

2.1. Market Analysis

A number of factors affect the demand of standardized apartment. Of these factors, the most
important to have influence is population growth and the level of income. The currently
expanding the service and industrial sector in the city and around has been inviting skilled and
unskilled labor forces to the city; in addition, the number of both government and non -
government offices has been increasing. Above all the increase in the number of population of
the city increases for the provision of different services. Nowadays, most of the individuals
need their own houses and they prefer the place that found in the center of the city.
Though the market demand gap for standardized apartment in the city is not clearly understand
there is wider gap for such demand. From prior business experiences, the demand of standard
apartment in the city is very high and hence the demand and the supply gap is very wide.
Addis Ababa, which is the largest as well as the dominant political, and economic center of the
country, is home to about 5,000,000 inhabitants (18% of urban residents in the country) in 2016
(CSA, 2013). The city accounted for 30% of the national GDP; 20% of the country's urban
labour force, 68% of the country's urban jobs in real estate, 40% in information and
communication, and 36% in financial services (Egis International in association with IAU-
IdF&Urba Lyon , 2016). The roles and contributions of the city in the nation economic growth
are expected to grow significantly in the country`s strive for middle-income status. Therefore,
the city ought to allocate and supply adequate serviced land for development objectives (housing
which might be residential or/and nonresidential buildings, land for infrastructure development,
social development, investment projects both foreign direct investments and domestic
investment).The government is the primary driver of growth with large capital allocations made
towards infrastructure works which have been planned to improve access to basic services, create
jobs and reduce poverty. Poverty is still widespread however, and relief is heavily reliant on
donor support.

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Construction and development of real estate in Addis Ababa is flourishing on the back of
infrastructure expenditure on road network improvements. High-rise, mixed-use buildings across
the city have been delivered along main arterial routes primarily on small parcels of land usually
owned by one individual. All land is owned by the government with the use of urban land
granted via 99, 80 and 70 year leases for residential and social services, manufacturing and
business respectively. Leases or tenancy agreements are normally signed for the duration of one
year with bi-annual rental payments made while parking and the tenant typically pays service
charges annually. Tenancy agreements do not carry rental escalations and are renewed at the
same or a renegotiated rate.
2.2 Demand and Supply Gap

Over 2.5 million Ethiopians live outside of their country by 2013 Ethiopia had 2,700
millionaires, far behind less populous countries like Kenya and South Africa. New World Wealth
predicts that the number will rise to 4,700 by 2020 due to the country's rapid pace of economic
growth. Currently, there are around real estate investments across the country with a total
investment capital of 3.5 billion birr. According to data from Ethiopian Investment Commission,
since 2015, close to 117 companies took an investment license to invest on 56 different real
estate projects. From 117, 99 percent of them are owned by Ethiopians or in joint venture with
foreign investors. Some were still fully owned by foreigners. The primary destination of the real
estate industry in Ethiopia, of course, is Addis Ababa. Out of the existing 56 real estate projects
to date, 43 are located in Addis Ababa. By consider each project allocated around Addis Ababa
which is 43 real estate housing project companies if we assume each projects can build 1000
houses which is total 43,000 apartment houses but they doesn’t fulfill the demand, Because
according to Ethiopia economic association there is a demand 900,000 houses on the coming 10
years.

The target and potential customers of this envisaged project include:-

1. Diaspora community
2. Business gurus
3. High profile government officials

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 4. Business community who may work at our and other buildings
5. Business organization : such as banks, insurance, supermarkets,
6. Non-governmental organizations : Association, NGOs, Professional service providers, etc
2.3. Marketing Promotion and Strategy

In order to penetrate and gain considerable market share, one of the major marketing strategies
for the project is to retain our reputation for on time delivery and customer friendly payment
plans. The major marketing strategies to promote the project and gain considerable market share
include:
 Advertising through digital marketing strategy
 Advertising through different means circle of influence
 Promote in association to the key location and nearby business
 Working on sustained promotional work and traditional advertising system
 Working on public relations to reach and influence key personas and organization with a
capacity of making decision.
 Seasonal discount pricing different others customer centric marketing strategies will be
used by the company.
For such marketing activities we have already employed marketing company named as
My Home Real Estate Marketing plc.

2.4. Competition Analysis with Competitors Real Estate Company

There are different forms of competition that may face the real-estate apartments market. These
are price and non-price based competition. Moreover, there are different competitors that will
compete with the project either directly or indirectly. But standard apartments under discussion
have diversified marketing strategies that could enable it come up with the different competitors
in the market. Moreover it will frequently conduct competitors research which focuses on, the
strength and the weaknesses, the different competitors’ strategies, the techniques they use in
rendering the service, their customer handling methods, and others. Generally the project has

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many other projects all over Addis Ababa which compete with us.by considering the price
competition which is the main competition in real estate industry, let’s take some selling price
examples of real estate companies in m2.

No Real estste Location Price/m2 during Price/m2 After

construction construction
1 Ayat Real Estate ayat 120,000.00 145,000.00
2 Gift real estat ayat 100,000.00 140,000.00
3 Gion Real estate Gotera 111,000.00 156,000.00
4 Eleleta real estate Sare bet 128,000.00 180,000.00
5 Dmc real estate Labu 106,000.00 Waiting
6 Ovid real estate 4kilo 108,000.00 Waiting
7 Amibara real estate 4 kilo 110,000.00 Waiting

2.5. The Project Description

The project will construct 2B+G+15 building for selling residential build up area 329.5m 2. The
building have 2 basement floors for parking area including the ground floor and the other 15
floors held for residential apartment. As assumption design each floor will have 3unit apartments
which are type A have 2Bed room with 73.33 m 2 area, Type B have 3 bed room with 124.35 m 2
area, Type C have 3 bed room with 124.35 m 2 area. the second Finally the assumption design
will have 45 unit apartments with 3 parking floors.. With the completion of construction, the
building will provide apartments which have guest room, bed rooms, bath rooms, kitchen, maid
room.

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 Design for building apartment

2 2
Building
Type Description
Bed room Area (m(m
Area ) )
Basement
A 2Parking 2 basement
73.33 areas
Ground
B floor 3Parking Ground
124.35floor area with good look
2Cnd-15th floor 3Apartments 3 unit apartments per floor
124.35

Figure Floor Description

Type Floor Plan

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Type A
Common Area = 17.35
Area = 56
Total Area = 73.5

Type B
Common Area = 17.35
Area = 107
Total Area = 124.35

Type C
Common Area = 17.35
Area = 112
Total Area = 129.35

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3. TECHNICAL STUDY

3.1. Description of the Project Service/ Product Mix

The envisioned mall will provide different rental services to the different customer groups for
different purpose. The building will have basement, ground and then floors.
The purpose of the building explained as follows;
 the ground floor, designed for additional parking area with good look
,
 2nd – 15th there is four apartment houses on each floor which have 64 apartment houses
which have their own standard services. Besides, the building will have enough parking
facility under its two floor basement including ground floor with a capacity of more than
50 cars parking at a time.

3.2. Construction Schedule

Construction of the project is proposed to be started on October 2024, and is expected to be

finished on October 2027. Majority of the schedule’s time is made up of five major activities;
concrete, building Enclosure, masonry, mechanical &HVAC and Electrical install. Concrete
activities include processes such as placing foundations and slab on deck. The Building
Enclosure Phase includes erecting the scaffolding that will allow for exterior sheathing
installation and bricklaying.
Mechanical and Electrical install coincide with each other due to the need for coordination
between the two divisions. There are several periods of construction during the schedule in
which there are multiple construction activities occurring at the same time. The construction site
must be organized accordingly as these processes take place. As with any construction project,
the goal of the schedule was to complete all construction activities before the required Date of
completion.

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This date of completion is practical based on the time of year in which the building will be
completed. The team allowed a two week contingency for any setbacks. Typically, winter
construction tends to cause unforeseen delays that negatively impact a construction project.
These conditions can and will almost undoubtedly impact the project schedule by causing
unforeseen delays and project inefficiency especially at the first year.

3.3. Architectural Design & Layout

Although functional spaces for the project were laid out in significant detail, the detail of the
building had designated by consultant office. To make sure that the building’s layouts were
practical, the project owner researched typical architectural research for the designed building
layouts by its own team. The walls and partitions throughout the floor were congruent with the
structural frame and column locations.

3.4. Structural Design

One of principle deliverables of our project is the structural design of the building. The structural
were coordinated with the layout of the building adjustments were made to specific layouts are
necessary. The structural steel frame was chosen for further design based on cost per square foot,
local availability of material and constructability considerations, such as erection and fabrication.
The steel system was then designed for lateral loading with necessary adjustment being made to
framing.

3.5. Reinforced Concrete

The project group prepared hand structural design calculations for a typical bay of a reinforced
concrete frame. In all reinforced concrete bay designs, a superimposed dead load was assumed
for mechanical equipment, floor coverings and ceilings. Similarly, the designs of the typical
Loads were calculated based on the requirements of the minimum Design loads for Buildings
and other Structures.

3.6. Foundation Design

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The design of a superstructure may be accurate, have considered all possibilities and still fail
because the substructure is incapable of distributing the applied loads to the supporting soil.
Foundation design takes more into consideration than merely the loading from the columns.
While the main part of the project focused on the structural frame and its alternate designs, a
preliminary foundation plan was designed based upon maximum load carried from the
superstructure through the columns. The foundation design conducted by the project team
consisted of the selection of foundation type, determination of the bearing capacity and the
design for typical interior and exterior spread footings.

3.7. Construction Plan and process

The project team developed a coordinated project schedule and construction plans that would
reflect the expectations for an actual construction project. The project schedule was developed
using the preliminary designs given to the project team. Additionally, the group considered
typical construction activities and durations taken from similar construction projects as well as
realistic constraints on building development.
Based on a general program of the project owners the consultant who is going to be hired makes
site studies, develops structural designs, prepares drawings and specifications, determines
quantities involved and estimated the resultants costs. All these activities will be done in the first
phase of the project which is the design stage after the document are produced by the designers
have been received, and the works secured the project is supposed to enter the tendering stage.

At this stage contractors study the project document analyze and subsequently determine the
construction methods, built up their unit rates and submit their bids for the works. The owner of
this project intends to compare the bids and award the contract for the lowest responsible bidder.
This, is of course, presupposes that the favorable proposal does not exceed the allocated budget.
After the award is made and the contract signed between this project owner and the contractor,
the project constructor is expected to prepare and submits a detailed construction program which
includes material schedule, manpower requirement and cash flow forecast. After the award is
made and the contract signed between this project owner and the contractor, the project
constructor is expected to prepare and submits a detailed construction program which includes
material schedule, manpower requirement and cash flow forecast.

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3.8. Utilities

A number of utilities world be put in place in order to ensure smooth functioning of the project.
These utilities include:
 Water Supply,
 Supplementary Electricity supply.
 Telephone line Internet Broadband
 Fuel, Oil and lubricant
 Drainage Facility

3.9. Project Implementation

The project’s implementation is expected to take 24 months. The major activities include
arranging budget for construction of the building, cleaning the area around the building;
Procurement of equipment’s and starts rendering services. The time schedule for the above
matured major activities is presented below:
Table: Project implementation time schedule

No Activities Date
1 Land request processing Jun, 2024
2 Land approval July, 2024
3 Budget processing August, 2024
4 Site Development Septmber, 2024
5 Building and construction work October , 2024- September 2026
6 Finishing and Preparation October, 2026
7 Apartment for clients Jun, 2026

4. ORGANIZATIONAL STRUCTURE

4.1. Organization Structure and Management

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The organizational structure should be in a way that the company able to achieve its objectives as
well as the satisfaction of standard requirement. In addition to this, the structure should fit the
dynamics of all customers in the building ranging from small business to large tenants.
The organizational structure of the project is designed by including all the necessary personnel
under the right division. At the top of the organizational structure, there will be manager with the
responsibility of supervising the overall activity of the building. Depending up on the nature of
the center and the amount of work to be performs; there exist auxiliary units under the general
manager. Employees under each unit will be supervised by the department head that is
accountable for the general manager. General Manager is appointed by owner.

As clearly shown in the organizational structure, the center organization has one general real
estate manager and three main sections. Under the general manager there are the, construction
manager, marketing manager and consulting office. Further sub sections are also organized under
construction and marketing manager.

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 HIYA Real Estate
General Manager

My home Real
Construction Estate Construction
Manager Markating Consuting
Manager

Technical And Sells Team

Supportive Admin Construction
Maintenance Team
Manager
Promotion Team
HRM

Finance

5. FINANCIAL REQUIREMENT AND ANALYSIS

The Financial analysis include insight to the total capital outlay required for the project which
would consist of total fixed investment cost, and pre- production costs; the source of finance for
the total planned initial investment cost requirement and other parameter of feasibility analysis
including projection of profit/loss statement, cash flow statement and payback analysis.

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5.1. Projected Review

Based on the capacity of the envisioned real estate apartment building indicated in previous , the
total revenue of the project is projected as indicated in the table below from area of the project
and envisioned building which is 2B+G+15 Real Estate apartment.
 Building area 329.5m2
 To construct 2B+G+15= 18 Floors each 600m2

5.2 Investment Cost And Financing

The total initial investment cost of the project is estimated to be Birr *** million. Building
construction and equipment consists of significant part of birr *** million or about ****% of
the total financial requirement, Birr **(**%) is owner’ equity contribution that covers part of the
building cost, pre-operating costs & expenses and initial working capital. The remaining Birr
****million (about **%) investment is expected to be covered through pre-sales.

5.3 Profitability Forecast

The projected income statement indicates that the project is profitable throughout its evaluation
period of 10 years. The net income of the project record high profit of Birr 235 million in the 1st
year of the projection period and minimum birr 12 million from rental service income in the year
three.

6. APARTMENT PRICE

6.1 Apartment Price for other R-R GENERAL CONTRACTOR customer

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Apartment price for other R-R GENERAL CONTRACTOR estate customer

No Apartment Area Unit price (Us Unit price Total amount

type Dollar ) (ETB) (ETB)
1 A 73.35 2200.00 127,820.00 9,375,597.00
2 B 124.35 2200.00 127,820.00 15,894,417.00
3 C 129.35 2200.00 127,820.00 16,533,517.00

COMPARING APARTMENT PRICE WITH OTHER REAL ESTATE (74%

DISCOUNT)

No Real estste Location Price/m2 Price/m2 for Hiya Location

1 Ayat Real Estate ayat 120,000.00 78,516.00 Welo sefer
2 Gift real estat ayat 100,000.00 78,516.00 Welo sefer
3 Gion Real estate Gotera 111,000.00 78,516.00 Welo sefer
4 Eleleta real estate Sare bet 128,000.00 78,516.00 Welo sefer
5 Dmc real estate Labu 106,000.00 78,516.00 Welo sefer
6 Ovid real estate 4kilo 108,000.00 78,516.00 Welo sefer
7 Amibara real estate 4 kilo 110,000.00 78,516.00 Welo sefer

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 Apartment Price For Zamzam Bank and other
Costmer
18,000,000.00

16,000,000.00

14,000,000.00
Total amount (ETB)

12,000,000.00 price for other

costomers
10,000,000.00
price for zamzam
8,000,000.00 Bank

6,000,000.00

4,000,000.00

2,000,000.00

0.00
73.35 124.35 129.35

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 Price comparison Rihana redwan General CON-
TRACTORand other real estate company
140,000.00

120,000.00

100,000.00

80,000.00

60,000.00

40,000.00
Price/m2
Price /m2

20,000.00 Price/m2 for

hiya
0.00
Ayat Real Estate

Gift real estat

Gion Real estate

Eleleta real estate

Dmc real estate

Ovid real estate

Amibara real estate

1 2 3 4 5 6 7

Real Estate Company

7. SOCIO-ECONOMIC BENEFITS
Establishment of such kinds of project will offer a number of socio-economic benefits to the
country as well as the promoter of the project. Some of these socio-economic benefits will
include the following:

- Upholds the government endeavor to reduce housing problem

- The project helps in facilitating business activities in the country through availing office
rooms for rental purpose that can bring the required change in the development endeavor of
the country by creating employment opportunities, paying taxes to the government,
normalizing the current sky-rocketed office room fees, etc.
- Will bring a better infrastructure facilities for those who works and lives around
- Will contribute a long run economic benefit for the country like creating employment
opportunities,
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- It is a real addition to the country’s property, Enhance the ecstatic value of the city

8. CONCLUSIONS AND RECOMMENDATIONS

The objective of this feasibility study is primarily to facilitate the promoter with the investment
information and provide an overview about project. The proposed feasibility may form the basis
of an important investment decision and in order to serve this objective, the document covers
various aspects of Marketing, Finance and Business Management. The feasibility is based on the
information obtained from various sources as well as discussions with businessmen. For
financial model, since the forecast/projections relate to the future periods, actual results are likely
to differ because of the events and circumstances that don’t occur frequently as expected. Whilst
due care and attention has been taken in performing the exercise, no liability can be inferred for
any in-accuracy or omissions reported from the results thereof. It is essential that our report be
read in its entirety with financial model in order to fully comprehend the impact of key
assumptions on the range of values determined. The project is accessible and has the necessary
infrastructure such as road, telephone, water and electric power. The proposed project clearly
identifies all the necessary equipment, inputs, management of the company and the required man
power. The highest authority in the project will be vested in the hand of the owner. He will
control the overall activities of the proposed project. The proposed project possesses wide range
of economic and social benefits such as increasing the level of investment, tax revenue and
employment creation. Generally, the project is technically feasible, financially and commercially
viable as well as socially and economically acceptable. Hence the project is recommended.

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