Following withdrawal of Zeway Trading Plc. and SF Trading, the highest bid winners during the eleventh round land auction, the Addis Ketemma Sub-City Land Management Bureau has announced it will issue an auction again to transfer a 449 square meters of plot located around the place commonly known as Berbere Terra.
The first and second winners of the auction, Zeway Trading Plc. and SF Trading, dropped their interest to buy the land after they won the bid with a record high price offers, Capital learned from the Addis Ketemma Land Management Bureau.
Zeway Trading Plc. offered 305,000 birr per a square meter winning the bid at a total amount of 136.9 million birr. Zeway Trading Plc. was expected to finalize the deal with Addis Ketemma Land Management Bureau within thirteen days of announcement of the award but the company’s board refused to purchase the land at such an inflated price. Zeway will not retrieve the 108,000 birr it offered as a guarantee.
After Zeway rejected the purchase, the Addis Ketemma Land Management Bureau gave the chance to the second winner, SF Trading, to take over the plot. SF Trading offered the second highest price of 288,000 birr per a square meter. SF Trading similarly dropped its interest in the land although it was given a thirteen days period to conclude the deal. The time for SF Trading also run out on January 28, 2015.
“The winners didn’t turn up to sign a contract with our bureau during the given time. According to our procedure, the next step is to post another auction for leasing the land,’’ said a higher officer in the Addis Ketemma Land Management Bureau.
Among the forty seven applications submitted for the specific plot around Berbere Terra , a majority had offered more than 100,000 birr per square meter. Due to the high price that was offered, the business community in the area feared that the next auction will also attract even a higher bid as the area has high market transaction.
The officer at the Addis Ketemma Land Management Bureau said “the location is a business area and government cannot transfer the land for another purpose. And the only option is to put it up for lease again.’’
Zeway Trading Plc CEO, Muzemil Temam said “there had been a lot of talk in the local media and we were also pressured from the surrounding business community. Some people criticized us for the high offer. Due to those reasons our board agreed not to buy the land.’’
Back in December, a mere 449 square meters plot of land located in Addis Ketema Sub-City commonly known as Berbere Terra fetched an astounding 305,000 birr (around USD 15,500) per square meter that created a fuss.
The total cost of the land adds up to 137.8 million birr. The floor price of this particular plot was 1,323 birr.
The area is slated for a construction of G+8 storey building that will be used for a commercial purpose.
A recently released report by Global Property Guide that ranks world’s most expensive cities in terms of buying price of properties (not land), puts Geneva as one of the most expensive city to purchase a property with an average price of USD 15,250 per square meter.
With over 13 million people, Tokyo is the most densely populated city in the world and also one of the top ten most expensive. Real estate prices in Tokyo are close to USD 10,000 per square meter.
However this plot of empty land in Merkato fetched USD 15,500 per square meter.