CONSTRUCTION PROPOSAL, MULT-PURPOSE BUILDING CENTER JIGJIGA CITY

Project Proposal for the

construction of Mixed use
Building

PROJECT TO BE IMPLEMENTED IN SOMALI REGION,

FAFAN ZONE, JIGJIGA CITY

PROMOTER:-Ahmed mohamed PURPOSE COOPERATIVE ENTERPRISE

February 12, 2023

JIGJIGA

PREPARED BY: ENG. ABDI SALAH EAGLE ENGINEERING CONSULTANT JIG JIGA Page i
CONSTRUCTION PROPOSAL, MULT-PURPOSE BUILDING CENTER JIGJIGA CITY

Executive Summary

1. Project name: Shopping (Mixed use) Center Building

2. project Type : Multipurpose service shopping building
3. Nationality: Ethiopian
4. Project Owner: Ahmed mohamed
5. Project location:somali region,Fafan zone,jigjiga
6. Project composition: multipurpose Building (G+11) used for diverse
shopping centers like super market, shopes, restaurant, café, beauty salon,
Pharmacy, bed rooms and offices.
7. Primeses Required: building 700m2 and total site area 1200 m2
8. Total investment Cost: 113,009,121.5 ETB is required from this amount
45% ETB from owner equity and the rest 55% from bank loan.
9. Employment opportunity:19 individuals on permanent 150 on casual basis
10. Social and Economic Benefit: provide better Building service,
employment opportunities, generation of income and benefits for the local
people.

PREPARED BY: ENG. ABDI SALAH EAGLE ENGINEERING CONSULTANT JIG JIGA Page ii
CONSTRUCTION PROPOSAL, MULT-PURPOSE BUILDING CENTER JIGJIGA CITY

CONTENTS

1. INTRODUCTION…………………………………………………………………..1
1.1. General Background……………………………………………………1
1.2. Objective of the Project…………………………………………………2
1.3. Project Description………………………………………………………3
1.4. Project Rationale…………………………………………………………3
1.5. The Significance of the Project………………………………………..4
1.6. Project Location…………………………………………………………..5
2. THE MARKET STUDY……………………………………………………………6
2.1. Market Analysis…………………………………………………………..6
2.2. The Demand – Supply Gap……………………………………..........6
2.3. Current Supply of Mixed use Building………………………………7
2.4. Future Market/Demand of Commercial
Building Rental……………………………………………………………8
2.5. Target Customers…………………………………………………………8
2.6. Marketing Promotion and Strategy……………………………………8
2.7. Competition…………………………………………………………………9
2.8. The Project Facilities and Services Plan……………………………..9
3. TECHNICAL STUDY…………………………………………………………….10
3.1. Description of the Project Services………………………………….10
3.2. Land Use Plan…………………………………………………………...11
3.3. Construction work and Technology…………………………………11
3.3.1. Construction Schedule……………………………………………..11
3.3.2. Architectural Design Layout………………………………………12
3.3.3. Structural Design……………………………………………………13
3.3.4. Reinforcement Concrete………………………………………..….13
3.3.5. Foundation Design……………………………………………….…13
3.3.6. Construction Plan and Process………………………………..…14
3.4. Utilities…………………………………………………………………….15
3.5. Project Implementation………………………………………………...15

PREPARED BY: ENG. ABDI SALAH EAGLE ENGINEERING CONSULTANT JIG JIGA Page iii
CONSTRUCTION PROPOSAL, MULT-PURPOSE BUILDING CENTER JIGJIGA CITY

4. ORGANIZATIONAL STRUCTURE………………………………………….…16
4.1. Organization and Management……………………………………....16
4.2. Manpower………………………………………………………………. 16
4.3. Organization Structure………………………………………………. 16
5. FINANCIAL REQUIREMENT AND ANALYSIS…………………………….19
5.1. Fixed Investment……………………………………………………….19
5.1.1. Land, Building and Construction………………………………19
5.1.2. Building Machineries and Equipment………………………...19
5.1.3. Office Equipment………………………………………………..….20
5.2. Working Capital……………………………………………………….20
5.2.1. Operating Expense at Full Capacity………………………….20
5.2.1.1. Salary Expenses……………………………………….20
5.2.2. Operating Expenses…………………………………………..….21
5.2.3. Pre – Service Expenses……………………………………….….21
5.3. Financial Analysis and Statement………………………………..22
5.3.1. Underlying Assumptions………………………………………..22
5.3.2. Sources of Funds………………………………………………….22
5.3.3. Bank Loan Repayment and Schedules………………………23
5.3.4. Depreciation Schedules………………………………………….24
5.4. Financial Statement…………………………………………………..24
5.4.1. Income Loss/ Statement……………………………………......24
5.4.2. Cash Flow Statement……………………………………………..26
5.5. Financial Analysis………………………………………………..……26
5.5.1. Profitability………………………………………………………….26
5.5.2. Pay – Back Periods………………………………………………..27
6. ENVIRONMENTAL IMPACT………………………………………………...27

PREPARED BY: ENG. ABDI SALAH EAGLE ENGINEERING CONSULTANT JIG JIGA Page iv
CONSTRUCTION PROPOSAL, MULT-PURPOSE BUILDING CENTER JIGJIGA CITY

LIST OF TABLES

Table 01 : Project Facilities and Service Plan…………………………………10

Table 02 : Land Utilization Plan…………………………………………………11

Table 03 : Project Implementation Schedule..…………………………………16

Table 04 : Land, Building & Construction cost…………………………….…19

Table 05 : Building Machineries & Equipment cost……………………….…19

Table 06 :Office Equipment Cost…………………………………………………20

Table 07 : Salary Expenses…………………………………………………………20

Table 08 : Operating Expenses…………………..………………………………..21

Table 09 : Pre – Service Expenses……………….………………………………..21

Table 10 : Summary of Total Initial Investment Cost………………………..22

Table 11 : Total Financial Requirements……….……………………………….23

Table 12 : Bank Loan Repayment Schedule…………………………………….23

Table 13 : Depreciation Schedule……………….…………………………………24

Table 14 : Building Profit / Loss Statement….…………………………………25

Table 15 : Cash Flow Statement……………………..……………………………26

PREPARED BY: ENG. ABDI SALAH EAGLE ENGINEERING CONSULTANT JIG JIGA Page v
CONSTRUCTION PROPOSAL, MULT-PURPOSE BUILDING CENTER JIGJIGA CITY

LISTS OF FIGURES

Figure 01 :Organization Structure of the Building…………………………17

A PROJECT PROFILE OF
SIYAD MOHAMED
February, 2023 G.C
1. Introduction

These days by realizing the positive role that the private sector plays in the
development endeavours, the government of Ethiopia in general & the
Ethiopian Somali Regional State in particular, creating a favourable
investment atmosphere for private investment and business activities, with
the view to replace the hitherto significant role of the state with greater
domestic participation are in progress.

Among others, significant progress was made in reducing the bureaucratic

bottlenecks and regulatory impediments to doing business, the time taken to
get investment license is reduced & procedures to access land and credit
service for investment become simplified. By taking these opportunities in to
account, this hotel and Lodge project is initiated by Mr. AHMED MOHAMED,

as a Hotel and which is a complex hotel and service giving project to be

constructed in JiJiga City capital of the Somali Regional State, with the view
to meet the ever increasing demand of high standard hotel and class
luxurious areas, and there by earn income through rendering services for
visitors, business communities, government institutions & residents.

PREPARED BY: ENG. ABDI SALAH EAGLE ENGINEERING CONSULTANT JIG JIGA Page vi
CONSTRUCTION PROPOSAL, MULT-PURPOSE BUILDING CENTER JIGJIGA CITY

The government is constructing infrastructure appropriate for the city, this

project intends to support the endeavors of the government by providing mega
and modern building projects available for services.

This project profile has eight sections of which this introduction part is the
first. The remaining sections state the general summary, the objective,
location, activities, benefits, & financing.

2. General Summaries
1. Name of Project MADAD HOTEL
2. Project Investor Ahmed mohamed
3. Type of project investor hotel sector
4. Type of Project Shopping (Mixed use) Center Building
5. Project status New
6. Type of business multipurpose
7. Location of the Project kebele
 Region Somalia Regional State
 Zone Fafan
 City Jigjiga
8. Total project capital 113,009,121.5
9. Source of fund Personal equity and loan
10. Project life period 2 years (2015-2016 E.C)
11. Project operation start On 2015 E.C

PREPARED BY: ENG. ABDI SALAH EAGLE ENGINEERING CONSULTANT JIG JIGA Page vii
CONSTRUCTION PROPOSAL, MULT-PURPOSE BUILDING CENTER JIGJIGA CITY

3. Project Objectives

 The main Objective of the project is to develop a modern hotel and

Luxury/Recreational complex center, to support the existing positive
activities on the commercial sector and establishing hotel and recreational
urban services by introducing additional as well as an overall facility
expected from a contemporary hotel and urban recreational center. And to
be competent there by maximize on optimal profit through rendering
service & so as invest project having multiplier effect on overall economic
development of the city in general and that of the investor in particular.
 To construct and develop modern shops, offices, and restaurant,
supermarkets & cafeteria facilities that enable to provide standard services
to visitors.
 To undertake trading and other refuted business activities that enable to
generate a reasonable to the invested capital.
 To develop modern business centre that would provide services of
international standard in order to attract foreign visitors and thereby
contribute to wards the generation of hard currency for the country.
 To create employment opportunities for the population in the town and
Contribute towards the beautification of the town through the construction
of modern building infrastructure and facilities

PREPARED BY: ENG. ABDI SALAH EAGLE ENGINEERING CONSULTANT JIG JIGA Page viii
CONSTRUCTION PROPOSAL, MULT-PURPOSE BUILDING CENTER JIGJIGA CITY

4. Location of Project
As previously stated, the project would be located in Jigjiga city, the city as
a capital of the region is experiencing growth in various urban functions
and facilities which created huge demand and of the parts of the main high
way and city center is selected because it now needs the type of building
and a complete set of a modern hotel and recreational center and services
foreseen by this project. Since the particular location and its vicinity is also
prior in need of such a modern hotel and recreation center when
considering the whole development pattern of the city.
The development of the city can be seen from many angles; the city is
center for regional and Zonal center in terms of its strategic location along
the main high way connecting Harar and east part of the Somali Regions.
Consequently in connecting not only the Zone and the region but also the
country to the neighboring country Somalia to the north would have a
great favor for the anticipated inter regional social as well economic
development, the city is also the center for nearby rich urban areas
requiring for the service to be rendered by this project.
Currently, using the created favorable political, economical and social
development, the involvements of private sector grow in the urban
development activities.
Within the past five years the development of new private high-rise building
projects and the construction of governmental institutions like presidential
palace and existence of university in the city reveal the sustainable
development and government’s commitment towards development and
transformation.
The constructed air port/terminal will also play a great role in development
of the city. The project site is situated near jigjiga university high way
entering the city form togwajale.

PREPARED BY: ENG. ABDI SALAH EAGLE ENGINEERING CONSULTANT JIG JIGA Page ix
CONSTRUCTION PROPOSAL, MULT-PURPOSE BUILDING CENTER JIGJIGA CITY

Responding to the requirements of the development of the city, the federal

and regional government is making significant investments for
infrastructure.

Even though a promising efforts made in the provision of new commercial

institutions and service rendering facilities, but when compared with the
demand created and there is still visible lack of modern lodge and park for
tourist destination, tourists and residents as well.
The proposed hotel project is planned to be situated at the at best spot of
the city as mentioned earlier which is a main entry site to the city from
eastern part and somehow far from the current settlement boundary of the
city, which would attract for luxury seeking individuals.
The existing owned site having an area of 1957 meter square for the
proposed modern recreational area intend to accommodate various
activities and services.

Preliminary design
The project is designed to be a complex hotel, . It consists all basic
recreational service rendering institutions, wide and modern shopping
center for various cultural goods and items, super market, high quality
standard bed rooms, standard swimming pool, financial institutions like
well-designed bank and insurance in responding the demand of the
existing business and recreational activities, various service rendering
centres, and also incorporate to have an overall functions and be self-
sufficient recreational city centre.

The development of the project starting from the design up to

implementation is planned to incorporate the use existing settings,
resources both economic and social assets express harmoniously with
effective integrity and express at all level of the project development. The

PREPARED BY: ENG. ABDI SALAH EAGLE ENGINEERING CONSULTANT JIG JIGA Page x
CONSTRUCTION PROPOSAL, MULT-PURPOSE BUILDING CENTER JIGJIGA CITY

area to be used for the construction of the project has all required facilities
so as to provide the mentioned service efficiently.

1.1. Project Rationale

Internationally the economic growth this country is experiencing, the
good governance created, even if the region and city is in its highest
stage of development, this project is the first in its kind in the city is
feasible and would be a model development in promoting and attracting
different urban investments.

In order to respond to the created environment the town is in need of

major, basic and feasible urban projects to be developed.

The existing promising investment opportunities, the demands of 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 business project to be
established. Despite the promising business opportunities of the town,
the trend on such kinds of investment found to minimal. Since there is
no such kind of modern tourist facilities and business station in the
town to accommodate the existing demand of these services in the town
and the surrounding areas. The mismatch between the demand for and
supply of such kind of services is easily observed in the town.

Therefore, the existing shortage or absence in the supply of these

services, along with its commercial and administrative access, better
location and infrastructure access, escalating trend of urbanization and
business activities, thus it is with such reason that this project is
identified, proposed and assumed to be more profitable.

5. Project Activities and Services

PREPARED BY: ENG. ABDI SALAH EAGLE ENGINEERING CONSULTANT JIG JIGA Page xi
CONSTRUCTION PROPOSAL, MULT-PURPOSE BUILDING CENTER JIGJIGA CITY

5.1. Activities
The major project activities to be carried out include
 Project feasibility study & Project design
 Conduct bid process and hire professional contractor according to the
term referred in the bid document
 Follow up
 Handing over
 Recruit & Hire permanent employees
 Setting rent price and starting project operation
 Monthly collection of service charge
 Effect timely roam payment
 Undertake management & timely maintenances of building.
5.2. Services
As far as the project is a service-rendering project, the proposed
complex hotel and lodge service is expected to provide a modern
destination for customers with high level of services and facilities ever
experienced in the city.
The main services to be rendered by the complex lodge and park
briefly described below:

The Site Development

As it is mentioned previously it is found at the entrance or exit area of the city

where luxurious facilities would need to be located. Other new high rise
commercial building projects are also developing along this major road.

It will have one access Qomada roundabout or in front of qaryan dhodan

guest house Street which would be asphalted to the compound. The project
has an area of 1200 meter square compound.

The total built up area for buildings is 700 meter square, Circulation (paved
and stone tiled walk way) covers 200 square meter, Grass crate walk way

PREPARED BY: ENG. ABDI SALAH EAGLE ENGINEERING CONSULTANT JIG JIGA Page xii
CONSTRUCTION PROPOSAL, MULT-PURPOSE BUILDING CENTER JIGJIGA CITY

covers about 200 meter square, , 100 Protected grass cover with circular walk
ways covers square meter, about 90 parking lots and the rest is intact tree
and green zone. Therefore, about 48.8% of the project area will be covered by
these functions and the remaining 51.2% would be covered by intact tree and
green zone.

The main gate is at the front side, pedestrians, and vehicles access used for
loading and unloading from vehicles.

6. Benefit of the project

The proposed service-rendering project is strategically significant and
viable as being providing a series of direct and indirect socio-economic
benefit. Having the quality of being friendly to the existing administration,
visitors and business environment, the proposed project shall be expected
to worth the following packages of benefits:-
Creates 50 permanent and other many temporary employment
opportunities for unskilled laborers associated with building
construction.
Partly satisfies the existing high demand backlogs related with
shortage recreational areas and introduction of new as well as
various facility required from a modern lodge and park.
It will also attract other investors to enter in to real estate
development and other quality service giving projects in the city.
It will also contribute to the urban landscape by creating a beautiful
buildings and related facilities which could be seen as a land mark
for its vicinity.
Also benefit the regional economy through its value adding and
capital formation role.
7. Project Management
Once the projects is going to be operational the over all activities associated
with the complex lodge and resort management, and duties associated with

PREPARED BY: ENG. ABDI SALAH EAGLE ENGINEERING CONSULTANT JIG JIGA Page xiii
CONSTRUCTION PROPOSAL, MULT-PURPOSE BUILDING CENTER JIGJIGA CITY

renting management, rent collection and other financial and security

duties, business promotion duties will be managed by the manager. The
manager will be assisted by other permanent workers to carry out all the
necessary services demanded by the customers.
The manager will take care and check the customer’s satisfaction in all
kinds of the service render by the complex lodge and resort, and also
assures that the basic utilities such as electricity; water and telephone
systems work properly. He also closely follows the maintenances of
building equipment and facilities. Moreover, with close consultation of the
project owner, the manager is also responsible to setting price according to
the market price assessment, collecting fee if out sourced services for client
institutions, recording and closing the account of the lodge and resort.
Moreover, he will design or propose new method solution for the all type of
the service delivery to customers.
The owner is to become the general manager for the project.
8. Project Capital and Financing
8.1. Project Capital
Generally the project investment capital includes the total fixed
investment and working capital cost. Detail of the costs stated briefly
as follows.
8.1.1. Fixed Investment Cost

The project fixed investment cost includes those cost to be used for building
construction, purchase of fixed assets (furniture and equipment) and other
cost to be spent on designing and project proposal preparation.
Accordingly construction cost, which covers the largest portion of the total
project capital calculated to be Birr 113,009,121.5
Like wise the cost for project design feasibility study, project advertising
promotions and other miscellaneous cost (considered as pre-construction
expenses) calculated to be birr 1,000,000. The total fixed assets to be
purchased for project office also calculated to be birr 15,000,000. This cost
used for the purchase of furniture’s, equipments, vehicles and all relevant

PREPARED BY: ENG. ABDI SALAH EAGLE ENGINEERING CONSULTANT JIG JIGA Page xiv
CONSTRUCTION PROPOSAL, MULT-PURPOSE BUILDING CENTER JIGJIGA CITY

accessories and supplies necessary for the proper functioning of the complex
lodge and park.
8.1.2 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
 Promote in association to the key location and nearby business
 Working on sustained promotional work.
 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.

8.1.3. 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. But the mixed use building under discussion has
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 many
other projects all over Ethiopia which compete with it.

8.1.4. Working Capital Cost

The working capital cost of this project mainly include fixed administrative
cost salary, and that of variable administrative costs like stationary, repair
and maintainer utilities, insurances, fax and other miscellaneous expenses.
Working Capital Breakdown (**)
1.2. Construction work and Technology
1.2.1. Construction schedule
The construction project is proposed to be started on April 2021, and is
expected to be finished on November 2022. as seen in the abbreviated
construction schedule above, a majority of the schedule’s time is made up of

PREPARED BY: ENG. ABDI SALAH EAGLE ENGINEERING CONSULTANT JIG JIGA Page xv
CONSTRUCTION PROPOSAL, MULT-PURPOSE BUILDING CENTER JIGJIGA CITY

five major activities; Concrete, building Enclosur, masonry, mechanical

&HVAC and Electical 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 scheduale 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.

1.2.2. Architectural Design & Layout

Although functional spaces for the project were laid out in significant
detail, the rest of the building had designated spaces but n set layouts. It was
at the discretion of the project promoter to devise typical layouts for the non-
detailed commercial and office spaces. To make sure that the building’s
layouts were practical, the project owner researched typical architectural
layouts for laboratory and executive office spaces.
The walls and partitions throughout the floor were congruent with the
structural frame and column locations.

1.2.3. Structural design

One of principle deliverables of our project is the structural design of the
building. The structural bays were coordinated wit 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

PREPARED BY: ENG. ABDI SALAH EAGLE ENGINEERING CONSULTANT JIG JIGA Page xvi
CONSTRUCTION PROPOSAL, MULT-PURPOSE BUILDING CENTER JIGJIGA CITY

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.
1.2.4. 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 7.5 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
commercial space, in which a live load of 125 pounds per square was
assumed. Loads were calculated based on the requirements of the minimum
Design loads for Buildings and other Structures.
1.2.5. 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.
1.2.6. 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.

PREPARED BY: ENG. ABDI SALAH EAGLE ENGINEERING CONSULTANT JIG JIGA Page xvii
CONSTRUCTION PROPOSAL, MULT-PURPOSE BUILDING CENTER JIGJIGA CITY

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.
1.3. Utilities
A number of utilities would 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
1.4. 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: project Implementation schedule

SN Activities Date

1 Land request processing January – February, 2023

2 Land approval March, 2023

3 Bank loan processing April -May, 2023

PREPARED BY: ENG. ABDI SALAH EAGLE ENGINEERING CONSULTANT JIG JIGA Page xviii
CONSTRUCTION PROPOSAL, MULT-PURPOSE BUILDING CENTER JIGJIGA CITY

4 Site Development June, 2023

5 Building and construction July, 2023-November, 2024

work

6 Preparation for service December, 2024

7 Service execution January, 2025

Organizational Structure
1.5. 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.
1.6. Man Power
The total manpower required for the building will be 50 persons. The
manpower list and the corresponding labor cost are shown in part five of this
document.
1.7. 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

PREPARED BY: ENG. ABDI SALAH EAGLE ENGINEERING CONSULTANT JIG JIGA Page xix
CONSTRUCTION PROPOSAL, MULT-PURPOSE BUILDING CENTER JIGJIGA CITY

HRM and finance

IT, Electricity
and plumber

Cashier Purchas
er

Fig: 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.

PREPARED BY: ENG. ABDI SALAH EAGLE ENGINEERING CONSULTANT JIG JIGA Page xx
 CONSTRUCTION PROPOSAL, MULT-PURPOSE BUILDING CENTER JIGJIGA CITY

 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
2. 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
113,009,121.50ETB is required. From this 45% 50854104.68birr will be
covered by the promoter of the project while the rest 55% 62,155,016.83birr
will be covered through loan from bank at the prevailing interest rate.

Therefore the said amount of finance is needed for undertaking the following.
5.1 fixed Investment
A. Land, Building & Construction
S.N Description of works Total Cost in birr

1 Site development 300,000

2 Building construction 80,000,000

3 Design and supervision 1,060,000

Total 81,360,000

B. Building Machineries and Equipments

SN Description Meas Qty Unit cost Total cost in
urem in Birr Birr.
ent

PREPARED BY: ENG. ABDI SALAH EAGLE ENGINEERING CONSULTANT JIG JIGA Page xxi
 CONSTRUCTION PROPOSAL, MULT-PURPOSE BUILDING CENTER JIGJIGA CITY

1 Generator Unit 1 450,000.00 450,000.00

2 Security Equipment Unit Lms 50,000.00 50,000.00

3 Others Equipment and

7,500,000
machine

Total 8,000,000

5.2 Working Capital

5.2.1 Operating Expense at full Capacity2
a. salary Expense
Monthly Annual
SN Position No Qualification salary in salary in
Birr Birr

1 General manager 1 BA in management 15000 180,000

2 Building admin 1 BA in Acct/Mgt 5500 66,000

10+2 in secretariat 42,000

3 Secretary 1 3500
science

10+2 in 42,000
4 HRM Officer 1 3500
HRM/Management

5 Finance head 1 BA in Accounting 12500 150,000

Diploma in computer 42,800

6 IT Technician 1 3500
science/IT

7 Marketer 1 Diploma in marketing 4500 54,000

8 Accountant 1 Diploma in accounting 4500 54,000

9 Guards/Security 2 Basic 1500 32,000

General Service 54,000

10 1 Diploma in Management 4500
head

Diploma in purchasing 13,800

11 Purchaser 1 1150
&Sup Mgt

12 Electrician 1 10+2 in general electricity 3500 42,800

13 Plumber 1 10+2 in general mechanic 3500 42,800

PREPARED BY: ENG. ABDI SALAH EAGLE ENGINEERING CONSULTANT JIG JIGA Page xxii
 CONSTRUCTION PROPOSAL, MULT-PURPOSE BUILDING CENTER JIGJIGA CITY

14 Casher 1 10+1 in bookkeeping 3500 42,800

15 Cleaner 3 Unskilled 850 30,600

10+2 in General 42,800

16 Maintenance officer 1 3500
mechanic

Total 19 932,400

Benefit (20%) 186,480

Grand Total 1,118,880

5.2.2 Pre-service Expenses

SN Description Cost in birr

1 Project proposal 60,000.00

2 Licensing fee and 30,000

others

Total 90,000.00

Summary of Total initial investment cost

SN Description Cost in Birr

1 Land, building & construction 80,660,000

2 Building machines & Equipments 8,000,000.00

3 Office Equipment and hotel,cafteria 12,000,000.00

4 Total fixed investment cost 81,360,000

5 Salary expense 1,118,880.00

6 Operation Expense 156,685.02

7 Pre service Expense 100,000

8 Total Working capital 1,375,565

9 Sub total 102,735,565

10 Contingency (10%) 10,273,556.5

PREPARED BY: ENG. ABDI SALAH EAGLE ENGINEERING CONSULTANT JIG JIGA Page xxiii
 CONSTRUCTION PROPOSAL, MULT-PURPOSE BUILDING CENTER JIGJIGA CITY

Total initial investment capital 113,009,121.5

5.3 Financial analysis and Statements

5.3.1 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 45% equity and 55% loan
Bank interest rate 10%
B. depreciation
Building 10%
Building machinery and equipment 8%
Office Equipments 12 %
5.3.2 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 45% and 55%
respectively. Accordingly, the total financial requirement from the two sources
will be;

Percentage
SN Description Amount
share

Owners Share 45% 50854104.68

Bank Loan 55% 62,155,016.83

Total 100% 113,009,121.50

Depreciation Schedule

Depreciation
S Original Depreciation
Description per year in
N Value in Birr rate in %
Birr

PREPARED BY: ENG. ABDI SALAH EAGLE ENGINEERING CONSULTANT JIG JIGA Page xxiv
 CONSTRUCTION PROPOSAL, MULT-PURPOSE BUILDING CENTER JIGJIGA CITY

1 Construction and Building 80,000,000 10 8,000,000

Bldg. machines &

2 8,000,000 10 800,000
Equipment

3 Office Equipment 12,000,000 10 1,200,000

100,000,00
Total 10,000,000
0

Financial analysis
i. Profitability
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 plus interest 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.
ii. Pay-Back periods
The investment cost and income statement projection are used to project the
pay-back period. The building’s total investment will be fully recovered at the
8th years of operation.
3. 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 impacts.
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

PREPARED BY: ENG. ABDI SALAH EAGLE ENGINEERING CONSULTANT JIG JIGA Page xxv
CONSTRUCTION PROPOSAL, MULT-PURPOSE BUILDING CENTER JIGJIGA CITY

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 will be 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 equipments.
3. Swages During Operation
During operation there are some wastes emitting from the mixed use building.
These are wastes from the latrine and will be mitigated by using modern
waste treatment technology.

DRIFT DESIGN Architectures

PREPARED BY: ENG. ABDI SALAH EAGLE ENGINEERING CONSULTANT JIG JIGA Page xxvi
CONSTRUCTION PROPOSAL, MULT-PURPOSE BUILDING CENTER JIGJIGA CITY

PREPARED BY: ENG. ABDI SALAH EAGLE ENGINEERING CONSULTANT JIG JIGA Page xxvii
CONSTRUCTION PROPOSAL, MULT-PURPOSE BUILDING CENTER JIGJIGA CITY

PREPARED BY: ENG. ABDI SALAH EAGLE ENGINEERING CONSULTANT JIG JIGA Page xxviii
CONSTRUCTION PROPOSAL, MULT-PURPOSE BUILDING CENTER JIGJIGA CITY

PREPARED BY: ENG. ABDI SALAH EAGLE ENGINEERING CONSULTANT JIG JIGA Page xxix