The Federal Housing Corporation (FHC) which has 6,665 business houses in Addis Ababa set a new price ranging from 1,000 birr up to 400,000 birr per month rental fees.
FHC took three years to revise the business shop rental and offices which has angered some of the tenants.
The increase which will be applied starting from next month takes into account the location of the houses, their size and the material they are made from.
Under the new revision 477 shops are set to pay 1,000 birr per month, 3,078 shops between 1,000 up to 2,000 birr, 447 shops between 20,000 to 30,000, three shops from 200,000 up to 300,000 birr and two buildings will pay 400,000 birr per month.
The corporation did not make any price revision for business shops in the last 40 years.
The famous Mekonnen Baklava House in Piassa was paying 5,960 birr per month. Moreover the other famous bar in town Jolly Bar was paying only 5,252 birr per month. Romina Café (Arat Kilo), Tikur Abay Hotel (Piassa) were paying 5,000 birr and 632 birr respectively. Tourist Hotel (Arat Kilo) were paying only 13,000 birr for the whole building.
Before the new revision 3,880 of the shops were paying 65 birr per square meter and 2,052 shops were paying below 10 birr for a square meter. Surprisingly the rental fee of another 279 shops was below one birr per square meter.
Kibrom Gebremedhin, Corporate Communications director of FHC told Capital that the price adjustment is fair and just.
“Before we set a new price we had a meeting with the tenants and we told them what they are paying is not according to the market rate. It is not logical to charge tenants prices from 40 years ago. If you go to some private
shops they pay 10,000 birr for nine square meters, but we had been receiving less than one birr for one square meter.”
He added that the corporation had been trying for more than three times to adjust the price but various internal and external problems kept them from accomplishing their goal.
“We need to build more houses, we need to increase our maintenance capacity and to do that we need money and for the money setting a fair rental fee is a mandatory task.’’
According to him some tenants are calling the corporation to threaten them. “ Honestly speaking most of the renters were benefiting from the small rental fee they paid for a long time so they should thank us but sadly some called our office and insulted us and sometimes they are threating us.’’
He added that from now on the price revision will be carried out every five years.
The Ethiopian Association of Civil Engineers are among those complaining about the price revision.
“We are not a business company who works for profit but they increased the rent fee from 3,000 birr to 59,000 birr which is unhealthy. We are asking for the corporation to revise this price.”
Another woman who works in Merkato said the increase is fair but should have been done step by step.
“The increase is fair but would be nice for us if they increased it gradually.’’
Most of the old shops the corporation owns were built during the second Italian aggression and in the Derg Regime.
Currently the corporation is working to build five G+12 story buildings in Addis Ababa. (Capital Ethiopia)