Zone Mejlis

Project Proposal for the construction of
Office Use Building
Project is to be implemented South

Weast Peoples Regional State ,Sheka
Zone,Tepi Town
Promoter: - Sheka Zone Mejilis
April, 2024
Project Proposal for Sheka Zone Islamic Affaire G+5 Office use Building construction
Contents pages
1. Executive Summary.........................................................................................................4
2. Introduction......................................................................................................................5
2.1. General Background.....................................................................................................5
2.2. Objective of the project................................................................................................7
2.3. Project description........................................................................................................8
2.4. Project Rationale...........................................................................................................9
2.5. The significance of the project.....................................................................................9
2.6. Project Location..........................................................................................................11
3. The market Study...........................................................................................................11
3.1. Market Analysis..........................................................................................................11
3.2. The Demand-Supply Gap...........................................................................................12
3.3. Current supply of mixed use building........................................................................13
3.4. Future market or Demand of commercial Building rental..........................................14
3.5. Target customers.........................................................................................................15
3.6. Marketing promotion and strategy..............................................................................15
3.7. Competition................................................................................................................16
3.8. The project facilities and Services plan......................................................................17
4. Technical Study.............................................................................................................18
4.1. Description of the project Service/ Product mix.........................................................18
4.2. Construction work and Technology............................................................................19
4.3. Utilities.......................................................................................................................23
5. Engineering and civil works..........................................................................................24
5.1. Land, Building and Civil Works.................................................................................24
5.2.Man Power...................................................................................................................25
5.3. Project implementation...............................................................................................27
5.4.Organizational Structure..............................................................................................27
5.4.1. Organization and management................................................................................27
5.5. Financial Requirement and Analysis..........................................................................31
6. Financial analysis and Statements.................................................................................36

6.2. Financial Statement....................................................................................................39
6.2.1. Income loss/statement..............................................................................................39
6.3. Financial analysis........................................................................................................41
7. Environmental impact of the project.............................................................................41
List of table
Table 1.Office Space Demand Forecast............................................................................15

Table 2.The plan is that the ground will be partitioned in to different rooms:..................17
Table 3. Land utilization Plan............................................................................................19
Table 4.List of Building and Civil Works and Their Costs...............................................24
Table 5.Manpower Requirement and Annual Labor Cost.................................................25
Table 6. project Implementation schedule.........................................................................27
Table 7. Land, Building & Construction...........................................................................31
Table 8. Building Machineries and Equipments................................................................32
Table 9.office equipment...................................................................................................33
Table 10.Operating Expenses............................................................................................34
Table 11 Pre-service Expenses..........................................................................................35
Table 12.Summary of Total initial investment cost...........................................................35
Table 13.Loan repayment schedule...................................................................................37
Table 14.Depreciation schedule.........................................................................................38
Table 15.Mixed use Building profit/Loss Statement.........................................................39
Table 16.Cash Flow statement...........................................................................................40
List of Figures
Figure 1.organization structure of the Building.................................................................28
1. Executive Summary
Key information highlights
Project Owner Sheka Zone Islamic afaier

Project title Office use building
Land requirement 620 m2
Project area Tepi town
Production capacity G +5
Products to be manufactured
Office purpose rooms
Market Domestic and international
Cost of the project 12400000 ETB
Source of fund 30% or 3720000 from Owner Equity and the rest
70% from bank loan.
Number of working days 365 days
Employment opportunity: 23 individuals on permanent 80 on casual basis
Social and economic benefit: Provide better Aesthetic building for the town,
employment opportunities, generation of income and
benefits for the local people
Pbp ( pay back period) 10 yrs
Analysis result
The project is technically feasible, financially and Service base viable as well as socially and economically
acceptable. Hence, the project is worth implementing.
2. Introduction
2.1. General Background
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. This certainly spurs large demand in the
property market for office space, shopping malls, catering services, apartment and
residential houses. Following growing demand trends, and with the expectation of high
return on their investment capital, large number of land developers pooled their financial
resources and invested in the property market.
Tepi town is one of more economically Currently stable town in sheka zone popular in
Crop,Fruits and Vegetatn Coffee and tikitik done . Office use building will be owned and
operated by Sheka zone Islamic Affaier, whom are resident for long time in the district
planned to construct mixed use building in Sarbo town Thus,This project feasibility study
is undertaken to check the service base usefulness, technical and financial feasibility of
this project. The project will be operated as a Public ownership and will offer Regional
Islamic Affairs Council Enforcement Office, Hajj and Umrah Service Office, Zonal
Assembly President's Office, Office of the Vice President and Secretary, City council
office, wereda Majlis Office, Zonal Majlis and wereda Majlis Registry, Vaccine library,
Store, Secretary's office, Meeting hall, Information desk office, Toilet and shower house
and Guest accommodation. Recently Tepi town is becoming convenience for such
investment and the growing demand of better economic service. To realize this office use
building plays a crucial role to promote the growth of the town in one hand and to reduce
the growing demand of office use house. The socio-economic environment of the town
The promoter is very ambitious and committed to realize the project. Hence, they expects
to get the necessary support from the city administration to make the project to be
operational.
In this regard, government policies and the incentives and support provided to religious
institutions to engage in construction work are particularly promising.
2.2. Objective of the project

The major goal of this project is to contribute towards the Formation and Spiritual
Growth. Its specific objectives include the following.
The General objectives of this project are:-
To prioritize the formation and spiritual growth of our religion by providing spaces for
meditation, and study.
The Specific Objectives of this project are:-
 To serve as hubs for administrative tasks, communication, and coordination within

religious communities by housing offices for leadership, secretarial work, financial
management, and other administrative functions.
 To facilitate collaboration and community life by provide areas for meetings,

planning, and decision-making among our religious members.
 To create employment opportunities for the population in the town and
 Contribute towards the development of the town through the construction of modern
building infrastructure and facilities.
 To host religious programs, workshops, and seminars for the followers.
 To handle resource allocation, including finances, personnel, and material resources.
 To minimize energy conservation, improve sustainability and cost-effectiveness by

designing efficient office buildings.
 To adapt changing needs of religious communities for future modifications and

adjustments.
2.3. Project description

The popularity of convenience building and office use service as religious institutions
become more economically grow and demand for safe, sustainable peace and religious
unity and service by constructing this building. Coffee is the major cash crop in tepi
towen. In tepi town ther is shortage of office use building that promotes efficient office
service. Office use building will carry a wide range of providing services in its class,
allowing Believers to satisfy more needs quickly in one location without any complaint.
However, there is a shortage of such activity in tepi town besides its being a center as for
Believers nearby woreda like Yeki, Andiracha and Massha. The owner plans the project
to office use, shopping facility, and cafeteria services to create high quality class to
satisfy the interest of Islamic believers in the town. Plus to this service the owner also
plans Based on environmental and other considerations, the entrepreneur has determined
the type and size of the building which is already determined by the site; conceptual
planning and preliminary analysis have been carried out by analysts.
2.4. Project Rationale

One of the biggest problems which are often occurring in the current urbanization
development in least developed countries is in convenience of office use building.
Therefore it is important to offer service integration of demand and supply. Sheka zone
Islamic affair office use building is reliable service center renovating G+5 story building
for office use in Tepi town. Therefore, The Promoter will complete the building as per
requirements and specification provided by the client.
The Economic growth and rapid urbanization in the country is promising investment
opportunities, the demands of product and service needs along with relatively sound
investment support made by the government in such kinds of feasible projects, compelled
the project promoter to initiate the multipurpose oriented service project to be
established. Despite the promising office use opportunities of the town, the trend on such
kinds of investment found to not enough. The mismatch between the demand for and
supply of such kind of services in easily observed in the town.
Therefore, the existing shortage or absence in the supply of these services, along with its
office and administrative access, better location and infrastructure access, escalating trend
of urbanization and service activities, thus it is with such reason that this project is
identified and proposed and assumed to be more serviceable for the believers and others.
In general, initiation and supporting for religious institutions in the town; good
governance creates a favorable environment for the development of sustainable peace and
religious unity for religious Institutions.
2.5. The significance of the project

The envisaged project deemed to add to the economic development of the nation in
general and zone and town in specific with following ways:
A. Source of Revenue
As public policy of any nation, the government collects different forms of taxes from
different organizations and institutions. 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 town as well as
for the region.
B. 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 23 individuals and more
than eighty individual during construction.
C. Sources of social service
In addition to serving as a source of employment and income for the region, the project
renders social services for different group of people. Hence, it is also provide the
following services;
 Serve as a source of mental satisfaction for the different users,
 Since, the center encompasses different service area; it will divert the complaint of
the religious believers.
 It deemed to minimize the demand for office and other bundles of services in the area.
Furthermore, it serves as the pilot experience and ground for other religious institutions to
enter in to such kinds of urban development. It also contributes on the efforts made on as
a character given building for physical development pattern of the townscape.
2.6. Project Location

Tepi town is Located in the Sheka Zone of the South West Ethiopia Region, this town has a latitude
and longitude of 7°12′N 35°27′E with a mean elevation of 1,097 meters above sea level. The town is
said to be named after a Majangir man who once had a bee hive in the large tree that stood in the
marketplace.
Tepi town is a have its own administrative unit (municipal) under Sheka zone of the Suth
West Peoples Region state. Tepi town is the Capital town of Sheka Zone and a center of
socio-economic activity. The town is surrounded by rural kebele of Yeki woreda as it is
being the administrative center of Yeki woreda.
The envisioned project is intended to be located in Tepi town at about 611 km from
Addis Ababa to the south west. The town is selected because of strategic economic hub
for different cash crop like Coffee, and also Fruits and vegetation. The town have access
to basic social service like 24 hr electric service, telecom, post office, and clean water.
The town’s economic catchment extends beyond the yeki woreda attracting investor from
neighboring zones, regions and also from Addis Ababa.
3. The market Study

3.1. Market Analysis
The rapid growth of population along with urbanization, Increasing income and
modernity of town dweller and surrounding population residents are currently purchasing
“specialty” items in Jimma town that will be replaced provided by this project in Sarbo
town. Recently the increase in the price of Chat,Fruit and vegetable,Livestock and coffee
has increased the power of population for market. Town residents and surrounding area
population presently purchase everyday “necessity” items from small scale shop ‘Kiosk’
kebele house which does not allow satisfactory commercial activity and poor in
construction. On the other hand it’s not convenient to get goods and service in one
location which will waste time and price as well. People who purchase goods from such
small shop express dissatisfaction with availability and price. People travel to Jimma
town to fulfill their market demand, and the same is true for businessman to get
convenient rental shop they leave the town.
There are three major customer groups: (1) Local entrepreneurs (2) Diaspora looking for
essential business shop (2) surrounding town businessmen and entrepreneur (3) Whole
sale and distributer of good and service from big city, who look for convenience yet are
relatively price sensitive.
3.2. The Demand-Supply Gap

Sarbo town is situated in very centre of Chat,Coffee Arabica, Crops,fruit and Vegetablex
and fat livestock producing area. The town is a cash crop hub which is highly known for
its Fruit and vegetable,Cereal crop ,Chat and Livestock. Local business man, town
resident and surrounding population reside on income generated from the above product.
Recently the growing demand of Chat,Cereal crop,Fruits and vegetation is increasing
from local market to international market. So the income level of the society is increasing
due to the incrassating price of those products. On the other hand Sarbo town is also a
major business center and commercial route that attracts thousands of business travelers.
These are also the most important groups of potential customers that include both the
local and foreign tourists, commuters and the modern business community who choose
services that range from economic to high class standards.These groups would also
choose a healthy comfortable climate that combines a more traditional type with that of
modern shops, offices, bedrooms restaurants and cafeterias. Even though the town is
older town in the region Sarbo town seems to have no developed mixed use building, the
existing supply is far behind the growing demand for standard service. Hence, the project
will solve the serous demand problem in the town.
Over the last decade, there has been a significant growth in the number of local and
international trades across the country. Merchant from Jimma town from central market
and foreign trader starts to come to the town. This increase is mainly associated with the
stimulation of economic activist and partly due to an increase in the flow of international
and local traders in to the town. Since Sarbo town is an important commercial center in
addition there is a significant increase in business activates and hence increasing the
number of traders to the town. Even though there is a lack of quantitative estimates that
number of traders to the town. Even though there is a lack of quantitative estimates that
depict the actual demand and also the annual growth rate Hotel facilities and urban
commercial facilities are scarce in the city. So far in the town there is no development of
such kind standard building and it is the first of its kind in the town and will promote
other investors from the town and the surrounding areas. They are mostly villa type
premises modified as show rooms and sailing posits. As a result there is a large gap
between the developed and that of the supply for modern bed rooms; Bank and cafeteria
accommodation hence this project would not face any problem of demand scarcity for it
business centre and it would provide good service to customers.
3.3. Current supply of mixed use building

Commercial building/office sector has shown a dynamic change in the past few years.
The reason for this could be rapid economic growth and a supporting public
infrastructural development. Other factors relevant in the specific case of commercial
buildings are the large increases in national and international businesses, particularly
firms in the services sector.
The business of multipurpose buildings in Sarbo Town in booming highly due to the
recent rapid growth experienced in Ethiopia. As a result, a good number of local and
international organizational are coming in place. Government offices which used to
operate in limited spaces all over the city are also concentrating on leasing new and
modern buildings. Increasing numbers of international organization and NGOs which in

the past had typically converted residences into office space are now moving towards
renting whole floors or even multiple floors in modern city-center commercial buildings.
3.4. Future market or Demand of commercial Building rental

The demand for office space is a derived demand because firms rent space as an input to
the production of services or goods they provide to businesses and households in the local
regional or national economy.
Following our survey of office space users in Sarbo town are mainly firms providing
banking, cafeteria and restaurants, bed room, supermarkets service, computer Center
Crevice. The different customers for commercial buildings also include shops and offices
that are currently renting out to provide their goods and services.
Future demand for office space is actually driven from growth in number of offices in the
city which in turn is influenced by the macro-economic growth in the country. Following
the government five year growth and transformation plan (GTP), the Ethiopian economy
is expected to increase by 11% for base case scenario and 14% under the optimistic case
scenario. Assuming that demand for office space is directly related to the growth in the
economy, the forecast for office space demand is shown in the following table;
Table 1.Office Space Demand Forecast
Office space demand under Office space demand under high

base case economic case economic
Years Growth Growth
2010/2011 9,916,543 11,304,859
2011/2012 11,007,363 12,057,416
2012/2013 12,218,173 12,953,878
2013/2014 13,562,173 13,963,577

2014/2015 15,054,011 14,554,534
2015/2016 16,709,952 14,987,431
Source: estimation based on GTP’s forecasted Ethiopian Economic Growth
3.5. Target customers

The target customers of this envisaged project include:-
1. business Community
2. Nearby business organization
3. Bank and financial institution
4. the government bureau
5. small accounts(SOHO) SME
6. Nongovernmental organizations
3.6. Marketing promotion and strategy

In order to penetrate and gain considerable market share, one of the major marketing
strategies for the project is consistently rendering quality service to its tenants. Due
emphasis must be placed on improving quality of service and facilities. The major
marketing strategies to promote the project and gain considerable market share include:
 Advertising through different means focusing on the existing service and

facilities using FM radio ,Social Media and newspaper.
 Promote in association to the key location and nearby business
 Using advertising means like Banner, Business card, internet channel and pages.
 Working on public relations to reach and influence key personas and

organization with a capacity of making decision.
 Keeping the quality of its service/ facilities and consistently improving with
changing situations.
 Seasonal discount pricing different others customer centric marketing strategies

will be used by the company.
3.7. Competition
There are different forms of competition that may face the envisaged mixed use building.
These are price and non-price based competition. Moreover, there are different
competitors that will compete with the project either directly or indirectly. Mixed Use
commercial building desires to set a precedent in Sarbo town as a full service
convenience shop, store and service rendering with an economical image, offering a wide
range of competitively priced products and services in one location. Need of residents
and surrounding population combined with the consistent popularity of convenience
market predict a favorable business climate for MohammedNazif Aba Mecha Mixed use
building.
3.8. The project facilities and Services plan

In order to provide mixed use business center building services of a high standard, it has
been planned to construct and develop the infrastructure and facilities that would viable
to meet the requirements of an international standard business center. Accordingly,
various buildings and facilities will be constructed phase by phase starting with the most
needed ones that are essential to commence the operation of its business activities. With
the completion of construction, the building will provide a combined service such as
shops, bedroom, restaurant and café service as well as modern business center that
primarily serve its guests and major clients.
Table 2.The plan is that the ground will be partitioned in to different rooms:
Building Description UOM Unit price in

Birr
Ground Supermarket, Pharmacy, Banking & Insurance M2 200

1st floor Beauty salon, shop, Computer Center, Cafeteria & M2 200
Restaurant
2nd floor Different governmental, NGO & other offices M2 200
3rd floor Bedrooms service M2 200
Parking Service Car 5/per hour
Total
Since the project will be engaged in mixed building the main sources of its annual
revenue would be from the rental of building spaces such as shops, offices, and banking,
café & restaurant bedrooms. Therefore, the sources of revenue have been classified in to
one category namely the rental of banking & supermarket, offices, shops, bedrooms
restaurant and café based on these classifications. Based on the market price of similar
mixed use building in the area, the envisioned buildings set the following fair price
(Before VAT) for its service, hence when the building construction fully get operational
it is assumed to generate a yearly income of ETB 971,662.12.
4. Technical Study
4.1. Description of the project Service/ Product mix
The envisioned office use building will provide different office services to the different
Islamic affair and association for different purpose. The building will have parking,
ground and eight floors. The purpose of the building explained as follows;
 the ground floor, first floor and second floor designed for different business
centers like banks, supermarket, beauty salon(man and women), Computer
center, pharmacy, internet café, boutiques, different shops and other business
activities,
 The third floor designed for bed room services.

Besides, the buildings will have enough parking facility for its customers and green area
in its compound.
4.1.1. Land Use Plan
The total land required for the envisioned project is estimated to be 400 m 2 . the total area
for the construction of the building will be 200 m2, as revealed below.
Table 3. Land utilization Plan
SN Description Land M2
3rd Floor
2nd floor
1st floor
5th Floor
Ground
4th Floor
1 Building (G+3)
1.2 Ground 200
1.3 First floor 200
1.4 Second Floor 200
1.5 Third Floor 200
Parking & Green area 200
Total 400
4.2. Construction work and Technology

4.2.1. Construction schedule
The construction project is proposed to be started on February to march 2025, and is

expected to be finished on May 2028. as seen in the abbreviated construction schedule
above, a majority of the schedule’s time is made up of five major activities; Concrete,
building Enclosure, masonry, mechanical & HVAC and Electrical installation. 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.
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.
4.2.2. Architectural Design & Layout
Although functional spaces for the project were laid out in significant detail, the rest of
the building had designated spaces but not set layouts. It was at the discretion of the
project promoter to devise typical layouts for the non-detailed office spaces.
To make sure that the building’s layouts were practical, the project owner researched
typical architectural layouts for meeting hall and executive office spaces. The walls and
partitions throughout the floor were congruent with the structural frame and column
locations.
4.2.3. Structural design
One of principle deliverables of our project is the structural design of the building. The
structural bays were coordinated with the layout of the building adjustments were made
to the bays if specific layouts are necessary. The frame was made up of a grid with
repeating standard structural bays. Included in the structural system are bay sizes, shape
and size of structural members, floor compositions and curtain walls. These elements
were established to resist gravity ad lateral loads as appropriate.
The gravity load design was completed for two frames; one of structural steel and one of
reinforced concrete. 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.
4.2.4. 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 of 7.8 pounds per square foot was assumed for mechanical equipment, floor
coverings and ceilings.
Similarly, the design of the typical bay accounted for the use of different office use space,
in which a live load of 105 pounds per square was assumed. Loads were calculated based
on the requirements of the minimum Design loads for Buildings and other Structures.
4.2.5. Foundation Design
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.
4.2.6. 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. For instance, it is necessary for the structural frame to be completed before
concrete can be placed for the slab on deck. Hand drawn construction plans detailing site
entrances and storage areas were coordinated with the project schedule to give the reader
visualizations of the construction site set up through various periods of the construction
process.
The construction process for this project is normally a disjointed three mages
development by which the conceptualized need of the promoter of this project is
translated into a functional facility that will meet their needs in terms of time, cost and
quality.
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 promoter 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.
4.3. 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
5. Engineering and civil works

5.1. Land, Building and Civil Works
The Mixed use building has a total site area of 400 m2. The building floor area has
covered 200 m2 and the remaining 200 m2 is left for greenery and parking. The type of
buildings and its corresponding civil construction cost is given on Table 4.
Table 4.List of Building and Civil Works and Their Costs

No Description Total price
A. SUB-
STRACTU
RE
1 excavation and
earth works 110,324.12
2 concrete work 1,346,000
Sub total 1456324.12
B. SUPER
STRACTU
RE
1 Concrete work 1,100,358.45
2 Block work 252,534.40
3 Roofing 110,193.00
4 Carpentry and
joinery 98,760.00
5 Metal works 600,665.00
6 Finishing 1,051,379.44
7 Painting 108,398.88
8 Electrical
installation 400,532.00
9 Sanitary
installation 750,057.00
Subtotal 4,411,868.17
A+B 5,868,192.29
Vat (15%) 88,231.05
Grand total 6,850,000
As shown on Table 5, the total cost of building and civil work is estimated at Birr
6,850,000 and out of which the proponent has worked more than birr 5.86 million.
5.2. Man Power

The total manpower required for the building will be 23 persons. The manpower list and
the corresponding labor cost are shown in part five of this document.
5.2.1. Man Power Requirement
The list of manpower and the annual cost of labor is indicated in Table 5.
Table 5.Manpower Requirement and Annual Labor Cost
SN Position No Qualification Monthly Annual

salary in salary in
Birr Birr
1 General manager 1 BA in management 3000 36,000
2 Building admin 1 BA in Acct/Mgt 2500 30,000
2 Secretary 1 10+3 in secretariat 2000 24,000

science
3 HRM Officer 1 10+3 in 2000 24,000

HRM/Management
6 Finance head 1 BA in Accounting 4500 30,000
4 Technical and 1 Diploma in building 1500 18,000

maintenance manager maintenance
5 Marketer 1 Diploma in marketing 2000 24,000
6 Accountant 1 Diploma in accounting 2000 24,000
7 Guards/Security 4 Basic 1000 12,000
8 General Service head 1 Diploma in 1500 18,000

Management
9 Electrician 1 10+2 in general 1500 18,000

electricity
10 Casher 2 10+1 in bookkeeping 1000 12,000

11 Cleaner 5 Unskilled 750 9,000
12 Maintenance officer 1 10+2 in General 1000 12,000

mechanic
13 Driver 1 10 completed 2000 24,000
Total 23 315,000
Benefit (20%) 63,000
Grand Total 378,000
5.2.1. Labor Availability
Workers for this type of plant are available throughout the year. No foreseeable problems
are expected as most of the work requires no previous skills.
5.3. Project implementation

The project’s implementation is expected to take 24 months. The major activities include
Bank loan processing construction of the building, cleaning the area around the building,
Procurement of equipments and start rendering services. The time schedule for the above
matured major activities is presented below:
Table 6. project Implementation schedule
SN Activities Date
1 Land request processing April 2024
2 Land approval May 2024
3 Bank loan processing Jun- August 2024
4 Site Development January 2025

5 Building and construction work February-March 2022
6 Preparation for service January 2027
7 Service execution May-June 2028
5.4.Organizational Structure
5.4.1. Organization and management
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.
Organizational Structure
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.
Owner
General
Manager
Building Admin Marketing Technical and

maintenance
manager
Figure 1.organization structure of the Building

As clearly shown in the organizational structure, the center organization has one general
manager and three main sections. Under the general manager there are the, marketing
Department, maintenance and building administration department.
Under building admin dept there exist two sections i.e., HRM & finance and general
service. Further sub sections are also organized under technical and maintenance
manager. The following section deals with the duties and responsibilities of each
department.
A. The General Manager’s Duties and Responsibilities
 He/she will plan, organize, direct and control the overall activities of the building.
 He/she will devise policies and strategies that will enable the center to be profitable.
 He/she will incorporate modern technological innovation that will facilitate the
service delivery of the building to increase customer’s satisfaction.
 He/she will plan, organize, direct and control the human and non-human resources of
the building so as to achieve the short and long run objectives of the organization.
B. Building Administration Department
The building Administration Department of the multipurpose building has two main
sections (HRM and Finance and General Service section). It has responsible for
undertaking the following activities;
 Manage the human resources and control employee’s activity
 Well non human resources of the project, which include; effective handling of the
different resources of the building, and devise strategies of controlling against
fraud and damage.
 Will provide the right material or inventory to the center with right price at the
right time.
 Will plan, organize direct and control the financial transaction of the building by
using all the necessary documents.
 Accountant and casher that will collect money from the customers.
 Will develop sound financial control system by developing modern financial

control systems.
 Will prepare the annual financial statements and prepare condensed reports for
both the General Manager and other concerned government body.
 Follow the overall status of the business and provide maintenance and repair
services
C. The marketing Department
 Will handle the overall marketing activities of the organization which include
planning, organizing, directing, and controlling.
 Will develop the marketing strategies for future multipurpose building

development
 Will develop effective customer handling strategies.
 Execute the promotion methods.
D. Technical and maintenance manager
 Will handle the overall physical maintenance and related issues
 Will make sure electricity and back up is organized.
 Follow up security issues and educate tenants
 Works in collaboration with general service to make sure tenants are well served
5.5. Financial Requirement and Analysis

The financial resource is a prime resource for undertaking any activities. Hence for
implementing this mixed use building a total of 11,000,083.05 ETB is required. From this
30% (3,300,024.915) birr will be covered by the promoter of the project while the rest
70% (7,700,058.135) will be covered through loan from bank at the prevailing interest
rate. Therefore the said amount of finance is needed for undertaking the following.
5.5.1. Fixed Investment
A. Land, Building & Construction
Table 7. Land, Building & Construction
S.N Description of works Total Cost in birr
1 Building construction 6,850,000.00
2 Site Development 50,000.00
3 Design and supervision 120,000.00
4 1st Year land lease & (10%) 40,396.50

down payment
Total 7,060,396.50
B. Building Machineries and Equipments
Table 8. Building Machineries and Equipments
S Description Measureme Qt Unit cost in Total cost in

N nt y Birr Birr.
1 Generator Unit 1 200,000.00 200,000.00
2 Carpentry tool box Set 1 30,000.00 30,000.00
3 Electrician tools box Set 1 18,500.00 25,500.00
4 Plumber tools kit Set 1 12,300.00 19,300.00
5 Fire extinguisher Unit 10 6,000.00 80,000.00
(Security Unit 1 40,000.00 40,000.00

Equipment)
6 Total 394,800.00
C. Vehicle
S Description UOM Qt Unit Cost in Total cost in Remark

N y Fr. Birr
1 medium Unit 1 1,500,000.00 1,500,000.00 Duty

Truck(FSR) Free
Total 1,500,000.00
D. Office Equipments
Table 9.office equipment
SN Description Measurement Qty Unit cost Total cost

in birr in Birr
1 Managerial tables Unit 5 3,600.00 18,000.00
2 Managerial chairs Unit 5 2,000.00 10,000.00
3 Office table with Unit 7 3,000.00 21,000.00

chair
4 Secretarial table Unit 1 2,500.00 2,500.00

with chairs
5 Computer with Unit 3 28,000.00 84,000.00

chairs
6 Shelf Unit 4,500.00 0.00
7 Filing cabinets Unit 1 3,500.00 3,500.00
8 Guest chairs Unit 1 2000 2,000.00
9 Fax & Telephone Unit 5 2,500.00 12,500.00

machine
10 Carpet and Curtain LS 1 33000 33,000.00

Total 186,500.00
5.5.2..Working Capital
Operating Expense at full Capacity
Table 10.Operating Expenses

SN List of Items Annual List of Items Annual cost Assumptions
cost in birr in birr Used
1 Audit and legal SN Audit and legal 24,000.00 2000

fee fee br/per ,month
2 Stationery 1 Stationery 6,000.00 500 br/month

supplies supplies
3 Promotional Cost 2 Promotional Cost 40,000.00 Lump sum annual

cost
4 Property 3 Property 84,009.00 1% of the building

Insurance Insurance
5 Cleaning 4 Cleaning 10,800.00 900 br. Per month

Supplies Supplies
6 Uniforms 5 Uniforms 1,670.00 180 per pes for 16

people
7 Water 6 Water 12,600.00 4000m3 by 3.15 br

consumption consumption
8 Electric 7 Electric 12,000.00 20000KWH By

consumption consumption Br.0.4736
9 Fuel 8 Fuel 63,000.00 3000 lit per year

by Br. 21
10 Oil & Iubricants 9 Oil & Iubricants 6,300.00 10% of fuel cost
11 Telephone & fax 10 Telephone & fax 18,000.00 1500 per month
12 Repair expense 11 Repair expense 132,000.00 2% of building

cost
13 Miscellaneous 12 Miscellaneous 20,000.00 3000 per month

costs costs
Total 13 Total 430,379.00
Table 11 Pre-service Expenses

SN Description Cost in birr
1 Project proposal & EIA 50,000.00
2 Licensing fee and others
Total 50,000.00
Table 12.Summary of Total initial investment cost

SN Description Cost in Birr
1 Land, building & construction 7,060,396.50
2 machines & Equipments 394,800.00
3 Vehicle 1,500,000.00
4 Office Equipment 186,500.00
Total fixed investment cost 9,141,696.50
6 Salary expense 378,000.00
7 Operation Expense 430,379.00
8 Pre service Expense 50,000.00

Total Working capital 858,379.00
Sub total 10,000,075.50
11 Contingency (10%) 1,000,007.55
Total initial invest. capital 11,000,083.05
6. Financial analysis and Statements

Underlying Assumption
The financial analysis of the mixed use building is based on the data provided in the
preceding sections and the following assumptions.
A. construction and finance
Construction period 2 Years
source of finance 30% equity and 70 loan
Bank interest rate 10%
B. depreciation
Building 10%
Building machinery and equipment 10%
Office Equipments 10%
6.3.2. Sources of Fund
The source of fund to finance the project is planned to be from two sources. These are
promoter’s equity and bank loan. The loan is expected to be obtained from one of the
local lending institutions. Since the project is expected to take some times to repay all its
debts, the bank loan is assumed to obtain on long term credit basis. Taking the financial
position of the promoters into account, equity contribution and bank loan to finance the
total investment outlays of the project are assumed to be 30% and 70% respectively.
Accordingly, the total financial requirement from the two sources will be;
Table 13.Source of fund.
Owners equity 30% 33,000,24.915
Bank loan 70% 7,700,058.135
Total 100% 11,000,083.05
6.3.3. Bank loan Repayment Schedule
Table 14.Loan repayment schedule
yea Principal Interest rate Total annual year ending

r payment (8.5%) Payment in ETB balance
0 7700058.135
1 770005.8135 654504.9415 1424510.755 6930052.322
2 773085.8135 589054.4473 1362140.261 6156966.508
3 773085.8135 523342.1532 1296427.967 5383880.695
4 773085.8135 457629.859 1230715.673 4610794.881
5 773085.8135 391917.5649 1165003.378 3837709.068
6 773085.8135 326205.2707 1099291.084 3064623.254
7 773085.8135 260492.9766 1033578.79 2291537.441
8 773085.8135 194780.6824 967866.4959 1518451.627

9 773085.8135 129068.3883 902154.2018 745365.8135
10 63356.09415 0
Assumtion
Total loan= 7700058.135
Repayment rate 10year
Annual interest rate 8.50%
6.3.4. Depreciation Schedule
Table 15.Depreciation schedule
S Description Original Value Depreciation Depreciation per

N in Birr rate in % year in Birr
1 Construction and 10 706,039.65

Building 7,060,396.50
2 Bldg. machines & 394,800.00 10 39,480.00

Equipments
3 Vehicle 1,500,000.00 5 75,000.00
4 Office Equipment 186,500.00 10 18,650.00
Total 9,141,696.50 839,169.65

6.2. Financial Statement

6.2.1. Income loss/statement
Project revenue and production costs are listed and compared to see whether the project
generate profits or not. Starting from first year of the project operation, the project will
generate a reasonable amount of net profit for the owners throughout its life period. Profit
and loss statement shows that the project will generate net profit of ETB 133,849.56 in
the first year and increase to ETB 971,662.12 starting from the third year of the project
life and hence it is found to be profitable.
Table 16.Office use Building profit/Loss Statement

Revenue Year 1 Year 2 Year 3 year 4 and
after
Rental Income 2,500,000.00 2,600,000.00 3,000,000.0 3,500,000.00

0
Expenses
Salary Expense 378,000.00 378,000.00 378,000.00 378,000.00
Operating Expenses 430,379.00 430,379.00 430,379.00 430,379.00
Deprecation Bld. 839,169.65 839,169.65 839,169.65 839,169.65

Machineries ,Equiq & vehicle
Interest Expense3 654,504.94 589,054.45 523,342.15 457,629.86
Lease payment4 6,732.75 6,732.75 6,732.75 6,732.75
Total Expense 2,308,786.34 2,243,335.85 2,177,623.5

5 2,111,911.26
Profit before Tax 191,213.66 356,664.15 822,376.45 1,388,088.74
Tax (30%) 57,364.10 106,999.25 246,712.93 416426.6223

Net profit 133,849.56 249,664.91 575,663.51 971,662.12
6.4.2. Cash flow Statement
Table 17.Cash Flow statement

Year Year 0 Year 1 Year 2 Year 3 year 4
Equity Capital 3300024.915
Loan principal 7700058.135
Net sale 0 2,500,000.00 2,600,000.0 3,000,000.00 3,500,000.00

0
Total Cash in 11,000,083 2,500,000.00 2,600,000.0 3,000,000.00 4,338,400.00

flow 0
Cash payment
Salary Expense 0 378,000.00 378,000.00 378,000.00 378,000.00
Investment 9,141,697 0 0 0 0
Pre operating 50,000 0 0 0 0

Expense
Operating Cost 0 430,379.00 430,379.00 430,379.00 430,379.00
Loan repayment 0 1,424,510.75 1,362,140.2 1,296,427.97 1,230,715.67

6
Lease payment 0 6,732.75 6,732.75 6,732.75 6,732.75
Tax payment 0 57,364.10 106,999.25 246,712.93 416,426.62
Total payment 9,191,696.50 1,918,986.60 1,906,251.2 1,980,252.65 2,084,254.04

6
Cash surplus/ 1,808,386.55 581,013.40 693,748.74 1,019,747.35 2,254,145.96

deficit
Cumulative cash 1,491,638.37 581,013.40 693,748.74 1,019,747.35 2,254,145.96

flow
6.3. Financial analysis

i. Profitability and service out put
According to the projected income statement, the building will start generating profit in
the 2nd year of operation. Important ration such as profit to total sales, net profit to equity
(Return on equity) and net profit on total investment (return on total investment) show as
increasing trend during the lifetime of the project. The income statement and the other
indicators of profitability show that the project is viable.
7. Environmental impact of the project

The EIA of the project activities was determined by identifying the environmental aspects
and then undertaking an environmental risk assessment to determine the significant
environmental aspects. The environmental impact assessment has included all phases of
the project namely construction phase and operational phase.
The building has both positive and negative impact
Positive impact of the project
The positive impact of the project is:-
 Generation of employment opportunity
 Source income for the government through business income tax
 Income generation for the promoter
 Being exemplary for other investors who want to engage in the same business
line.
Negative impact of the project
The project has the following negative impacts:
1. noise and Dust emission during Construction
There are some noises during the construction due to the construction operation
and the company will use construct the construction during the day time. Again
there is the emission of dust which will be mitigated by sprinkling water on the
service.
2. problem on workers on construction
During construction there are some problems that will materialize on workers. These are:
damage on operation by using machines, construction materials and others. To mitigate
such impact the company will provide safety insurance and safety equipment’s.
3. sewages during operation
During operation there are some wastes emitting from the Office use building. These are
wastes from the latrine and will be mitigated by using modern waste treatment
technology.

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Project Proposal for the construction of

Office Use Building

Project is to be implemented South

Promoter: - Sheka Zone Mejilis

6. Financial analysis and Statements.................................................................................36

Table 1.Office Space Demand Forecast............................................................................15

Figure 1.organization structure of the Building.................................................................28

Project Owner Sheka Zone Islamic afaier

Project title Office use building

Land requirement 620 m2

Project area Tepi town

Market Domestic and international

Cost of the project 12400000 ETB

Number of working days 365 days

Employment opportunity: 23 individuals on permanent 80 on casual basis

Pbp ( pay back period) 10 yrs

property (real estate) is greatly influenced by the performance of the macroeconomic

2.2. Objective of the project

The General objectives of this project are:-

The Specific Objectives of this project are:-

 To serve as hubs for administrative tasks, communication, and coordination within

 To facilitate collaboration and community life by provide areas for meetings,

 To create employment opportunities for the population in the town and

 To host religious programs, workshops, and seminars for the followers.

 To handle resource allocation, including finances, personnel, and material resources.

 To minimize energy conservation, improve sustainability and cost-effectiveness by

 To adapt changing needs of religious communities for future modifications and

2.3. Project description

2.4. Project Rationale

2.5. The significance of the project

C. Sources of social service

 Serve as a source of mental satisfaction for the different users,

2.6. Project Location

3. The market Study

3.2. The Demand-Supply Gap

3.3. Current supply of mixed use building

modern buildings. Increasing numbers of international organization and NGOs which in

3.4. Future market or Demand of commercial Building rental

Table 1.Office Space Demand Forecast

Office space demand under Office space demand under high

Years Growth Growth

2010/2011 9,916,543 11,304,859

2011/2012 11,007,363 12,057,416

2012/2013 12,218,173 12,953,878

2013/2014 13,562,173 13,963,577

2014/2015 15,054,011 14,554,534

2015/2016 16,709,952 14,987,431

Source: estimation based on GTP’s forecasted Ethiopian Economic Growth

3.5. Target customers

2. Nearby business organization

3. Bank and financial institution

4. the government bureau

5. small accounts(SOHO) SME

3.6. Marketing promotion and strategy

 Advertising through different means focusing on the existing service and

 Promote in association to the key location and nearby business

 Working on public relations to reach and influence key personas and

 Seasonal discount pricing different others customer centric marketing strategies

3.8. The project facilities and Services plan