Construction activity, like the one shoed near Wollo Sefer, Scaled up in Africa Avenue starting from September, creating difficulties for businesses by the side of the road.
The face-lift of Africa Avenue, in progress for the past 10 months, has brought commercial activity in the area to a standstill, and the revenue he gets from parking has declined significantly.
“I used to have three people under me collecting parking fees, but I was forced to let them go in recent months because I could not afford their wages,” he told Fortune. “I cannot wait for construction to end.”
This was not Henock’s sentiment when Fortune first talked to him 10 months ago, at the start of the Bole Road construction. Construction had started on the other side of the lane, bringing many additional cars and increased revenue to his parking lot.
This was, however, whenChinese Roadand Bridge Company (CRBC), the contractors awarded the project, and the Addis Abeba City Roads Authority (AACRA) were conducting construction in phases. A plan they have since changed.
The much awaited remodelling ofAfrica Avenuebegan on February 17, 2012. This was in spite of the fact that the design for the 4.3Km long, 40 metre wide road, consisting of wider lanes, two underpasses and an overpass was unveiled by Zewdie Eskinder & Co Plc, at the end of 2007.
A change, however, in the initial contractors awarded the project, a local company called Enyi, and the process of securing 60 million dollars in loans fromChina’s Export-Import Bank (EXIM), delayed the process.
SinceBole Roadwas already the flag-bearer of the upscale and modern commercial activity in Addis Abeba, construction was planned in five phases by the AACRA.
Only one lane was to be worked on at a time, and construction would not move on to the next phase before the completion of the prior lane. This, however, changed in September, after AACRA decided to complete the entire project, except for the underpass and overpasses, by May 2013, in time for the 50th anniversary of the African Union (AU).
Now the entire length of road is one big construction site, creating more difficulties, than were first anticipated, for the businesses that line either side. Some businesses that were previously apprehensive of a business slow down, but had decided to wait it out, are now packing up and leaving.
Unlike Henock, the Kaldi’s Coffee shop located underTommyTower, felt the effect of a business slowdown immediately. A week after construction started, it was deserted, whereas it had no trouble drawing in streams of customers before.
When Henok was enjoying the benefits of being on the other side of the lane, Kaldi’s Coffee was bearing the burden of being located on the stretch of road where construction had initially begun.
Being affected by the stall in business, they had started cutting back on their production, the manager of the store had told Fortune, at the time. Even that was not enough, however, to last out the construction process. Kaldi’s eventually had to close the shop, and has since been replaced by a furniture store.
Unable to cope with the loss of business caused by the Construction of the road, some businesses have discounted the prices of the items they sale and others have closed up shop and moved away.
It is not the lone casualty. There were some open spaces, previously occupied by businesses, inside most of the popular malls on the road, including Dembel City Centre, Getu Commercial,TommyTowerand Aberus, when Fortune visitedAfrica Avenueon Thursday December 13, 2012. Others businesses are not sure how they can continue to cope.
“We were expecting a business slow-down but this is a complete stand-still,” Nejat Siraj, part owner of a family-operated clothing store, named Fashion Business, which has a branch at SA Business Centre, told Fortune.
Some businesses have decided to stay behind because they have branches in other parts of the capital.
“The business is not sustainable here, and can seriously put someone in debt,” Nejat told Fortune. “We are paying rent out of our own pockets.”
Rent is a thorny issue. Businesses in Getu, Dembel andTommyTowerhave already asked, en masse and individually, for a reduction in rent for the current year, although no action has yet been taken by the administrators.
At SA Business Centre, businesses united together, two months ago, and asked for a rent reduction, but to no avail.
“You cannot completely push them to reduce prices since they have also been affected by the number of people leaving the mall,” Nejat told Fortune. “They too have to pay rent and income taxes.”
The businesses at Aberu’s, however, had been more successful in their request, having secured a 10 pc reduction in their rent.
“Although the road will have long-term benefits, it is creating difficulties currently,” Telahun Kebede, administration and finance head at Aberu’s told Fortune. “To prevent businesses from leaving, and to compensate them for the loss they have incurred we have reduced the rent.”
Although the move by Aberu’s is appreciated by their clients, it is still difficult to run a business these days. Hulu Bante, a boutique store, located inside Aberu’s, now sells at discounted rates, in order to attract customers.
Unlike other shops that Fortune surveyed that day, the boutique actually had two customers looking at the clothes on display.
“There is a rent decrease, but it is not enough to help make up for the lack of business,” Eyerusalem Tefera, a salesperson at Hulu Bante told Fortune.
More than the rent decrease, what Eyerusalem would like to see is a timely finish to construction activities.
“They should finish it soon, before we sustain any more damage,” she stated.
But for Jemal Mohammed, owner of Aldo shop inside Dembel, a quick completion of the project is not enough. He, like Eyerusalem and many other businesses, has also put most of his merchandise on sale at a discount. Business has decreased by 80pc since construction, according to him.
“InCanadathey usually give compensation for loss of businesses, whenever they conduct construction activities,” Jemal told Fortune. “Barring that, at least a tax break for the coming year should be considered by the government.”
Other businesses say that it is the building administrators who should be made to take further action.
“Advertisements are important during this time,” a businessman whose boutique is located in Dembel, told Fortune anonymously. “We have a parking lot and alternative space, unlike most of the other buildings. We should be able to take advantage of that during this time.”
This is especially important since most of the items sold at Bole are not necessities.
“No one would sacrifice their convenience when they can easily get the same thing in Piazza and other malls around town,” the businessman told Fortune.
Despite several alternative suggestions, the common target is the timely completion of the project.
This is not an issue, according to Fekade Haile (Eng), general manager of AACRA.
“Our plan to open at least the major part of the road by May this year is still on track,” he told Fortune. “The rest of the projects will be completed in two years time, in accordance to the original plan.”
While this alleviates the fear of many, other businesses located inside buildings, near where the overpasses and underpasses, will be built are still anxious. Some fear that the exit to the buildings, where their shops are located, will be located farther away, making it inconvenient for customers to park, even once the road is completed.
Their questions will only be answered, however, if the final result turns out to be as expected, one year down the road.
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