Afro-Tsion Construction, a company responsible for the construction of 1,192 houses for Ethiopian Airlines Employees, has started repair work on defective craftsmanship and work that seeks to remedy leaking roofs and broken and fissured tiles.
To date, Afro-Tsion has booked 451 calls of complaints ranging from minor electrical problems to construction flaws causing leaky roofs. To address the repair issues, the company has deployed a total of 120 professionals.
“Before the handover of the homes, all of the defects in the homes were recorded,” reads a letter from the Board of Housing Project, signed by Messay Shiferaw, the chairperson. “As repairing all the defects might take a long time, we have agreed to withhold payments of the contractor’s retentions to fix the defects.”
According to the management of the construction firm, retention payments and fees for some other work amounting to 20 million Br has been withheld by Ethiopian.
The homes, delivered to homeowners on July 24, 2018, were built for 1.5 billion Br. Ethiopian advanced 60pc of the cost as loans to its employees and the remaining 40pc was raised by the workers themselves. The loan amount is to be repaid with a 9.5pc interest over a 15-year term, and monthly payments are to be deducted from employee salaries.
“We have allotted 10 containers of materials, including ceramics, that can be used for the repair work,” said Tesfaye Misganaw, general manager of Afro-Tsion, a company founded two decades ago with an initial capital of 50,000 Br as a grade seven contractor.
The construction project was launched almost a decade ago when Zhejiang Yefeng, a Chinese construction firm that has been in operation since 1993, was awarded the turnkey project. The building site sits on a 313,000sqm plot in Bole District of Bole Arabsa, and was secured from the Addis Abeba City Administration on a 99-year lease contract. Construction commenced in 2011 with the promise of the delivery date of December 31, 2014.
The initial 3D design of the homes was done by a Chinese company, Institute of Architecture Design & Research Chinese Academy of Science, but was later revised.
“We contracted the homes on the basis of the design and the specification presented to us by the Airline by the time we contracted,” Tesfaye said.
After five years working on the project and completing 25pc to 30pc of the homes, the Chinese firm halted construction activities. In 2015, Ethiopian floated another tender to complete the project. Six companies responded to the offer including YOTEK Construction Plc, Flintstone Engineering, Tekleberhan Ambaye Construction (TACON) and Afro-Tsion Construction.
Afro-Tsion sealed the deal with the lowest bid of 23.1 million dollars and a 282 million Br payment, which reflects a discount of eight percent on its original bid price. Construction Design S. Co was the on-site supervisor of the project.
Afro-Tsion has experience working on the Oromia Cultural Center, Airfields in Jinka and Semera, Awash Bank’s Adama Branch Office, Gondar and Jimma universities, and the head office of Addis Abeba Police Commission. It recently won a 1.4 billion Br contract to construct the infrastructure for Yirgalem Integrated Agro-Processing Industrial Park.
After terminating the contract with the Chinese firm and awarding it to Afro-Tsion, Ethiopian increased the cost of the homes by 40pc.
“When we took over the project, we implemented remedial work worth 20 million Br,” Tesfaye told Fortune.
Adjusting structures, repairing cracks and partially damaged building and fixing slanted slopes were some of the remediation work conducted by the company, according to Tesfaye.
“We delivered the houses within two and a half years,” said Tesfaye. “To meet our commitment, we even incurred a loss of no less than 150 million Br.”
In addition to the work specified by the project, the management of the company claims that they have performed some work not listed in the contract document.
“We worked on drainage systems, pavement and ditches at our own expense,” said Tesfaye, “we also clad the window sills with granite, while the agreement was with porcelain [white translucent ceramic].”
The finishing materials were imported from Italy, China and England, according to Tesfaye and installed by the supplier companies who send their own technical teams to Ethiopia.
During construction, Afro-Tsion used 2.5 million bricks. The company procured two machines that can produce 12,000 bricks a day for 20 million Br. It installed three ground and one elevated water reservoir, along with nine compact electric power substations with 800-1,000kva capacity.
For the project, the company deployed 3,000 to 4,000 employees spending eight million Birr to nine million Birr in monthly payroll expenses, according to Tesfaye.
“It was 40pc of the company’s overall payroll,” he said.
The 70-year-old national carrier is in the process of hiring contractors for an additional 11,000 units under phase two of the project with close to 20 billion Br in investment. The company, with 16,002 employees as of January 31, 2017, is expected to announce the result of the bidding, apparently dominated by Chinese construction firms.
Either Anley Eshetu, corporate communications director of Ethiopian, nor Messay responded to Fortune’s inquiry until the paper went to print.
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