A company that makes prefabricated housing has sold 31.4 million birr in shares in just three months. This is higher than its goal of 29 million birr. It raked in, on average, 41 thousand birr from 773 people.
Addis Prefabricated Housing Manufacturing Industries Share Company floated 29,000 ordinary shares to the public with a par value of 1,000 birr from February 16 to April 16, 2012. However, the share company extended the time until May 20, 2012, due to high demand, according to Gezahegn Yayinshet, board chairman.
“Addis Prefab has not been idle in the past three months of share sales. The company has already sealed a procurement agreement with an American company for a light gauge steel factory and with a Chinese company for a calcium silicate board factory. These companies are ready to deliver once the payment is made,” said the board chairman.
The minimum share allotment is 25 while the maximum investment is 500 shares. Investors will be required to pay a 10 percent service charge. Potential investors are expected to pay 60 percent of the total investment amount up on subscription, 20 percent after three months of general assembly, and the remaining 20 percent after three months of the second payment.
The company was established by six founders with seed money amounting to 900,000 birr. It needs 97 million birr in its first phase of operation. They plan to raise the rest of the money through project loans.
Prefabricated material has the potential to dramatically reduce the price of homes. The company plans to produce 10,000 prefabricated houses which are expected to create job opportunities for 4,000 workers. The homes are said by some to be more durable, efficient and inexpensive. They will include luxury villas and condominiums including 45 G+1 homes and 551 apartments in 2013. They plan to include shareholders among the first to own their new homes.
Manufacturing houses in a factory has been practiced for over half a century in Western countries. It is done by using a load bearing wall floor structure made of light gauge steel, he explains.
Using prefab housing technology reduces the cost of a home from 30 to 40 percent. A person could save 500 percent of the time it takes to build a conventional house. For example, one can have a ground plus one house in 45 days using prefab technology. This saves cost both in terms of time and resources.
Despite its long history, Ethiopia is remains one of the least developed countries in Sub- Saharan Africa. Ethiopia’s urban population stands at around 11 million people. This represents only 16 percent of the total population of the country which currently is 83 million. With an average population growth rate of around three percent, the country needs 600,000 additional houses in the coming decade alone according to information obtained from Addis Ababa City Housing Development Agency. This implies an additional housing demand of 60,000 units per year.