This week saw private and state-owned developers sign contracts valued at 67 billion Birr for the construction of more than 4,100 housing units in Addis Ababa under the ‘Chaka Housing Development Project’.
The venture agreement, which includes the construction of the controversial ‘New Palace’ on a hilltop flanking the capital’s northeast, is part of a broader 72 billion birr housing initiative under a public-private partnership (PPP), was officially signed on July 3, 2025, between the Ministry of Finance and various real estate companies.
A statement released following the signing details that 4,175 housing units will be constructed as part of the Chaka Housing Development Project.
The project will be implemented through a 70/30 financing arrangement and will involve several developers, including ICE Housing Development Consortium PLC, Ovid Real Estate, the state-owned Ethiopian Construction Works Corporation (ECWC), and other private companies.
The housing units will be built on 24 hectares of land, with a total cost of 67 billion Birr.
Ovid Real Estate will construct 1,823 housing units and a shopping mall under the Tiyit Bet Housing Development Program at an estimated cost of 4.3 Billion birr.
In total, Ovid Chaka Housing Development PLC and Ovid Kings Tower PLC—both subsidiaries of Ovid Real Estate—have signed two agreements to build 3,675 housing units at a combined cost of 27.37 billion Birr.
ICE Housing Development Construction PLC has also signed a separate 32.37 billion Birr agreement to build a six-story shopping mall that includes 1,200 housing units.
Meanwhile, Boston Partners PLC has signed an 813.5 million Birr agreement to construct 50 luxury lodges and related infrastructure at the Awash Waterfall Resort Tourism Destination Development Project.
MIDROC Investment Group will invest 125 million Birr in tourism infrastructure at the Denbi Lake Lodge Destination Development Project, according to the statement.
The project also includes an integrated diagnostic service center that carries an estimated cost of USD five million, according to the statement. The health services contract was awarded through a competitive tender process, with the winning bidder selected based on the lowest offer.
Abebe Gebrehiwot, head of the Public-Private Partnership Department at the Ministry of Finance, elaborated on the criteria used to select the housing development companies.
“The government invited 11 companies to express interest, and six were selected based on technical, financial, and legal evaluations,” he said. “We selected developers based on their past experience with similar projects, financial capacity, and compliance with required standards.”
According to Abebe, 14 housing development projects have been planned under the Chaka housing project initiative, with three already awarded and the remaining 11 to be allocated in the future.
Among the awarded developers is the Ethiopian Construction Works Corporation, a state-owned enterprise that has faced criticism for delays in past projects.
In response to questions about ECWC’s selection, Abebe said: “The institution previously completed eight residential buildings at a cost of over 800 million Birr. It was selected for this project due to its experience and because it is partnering with other private housing developers.”
A dedicated project management team—comprising the palace administration, PPP officials, private institutions, and other stakeholders—will be established to oversee and monitor the timely completion of these housing developments.
Developers are expected to finance a fifth of the project costs from their own resources and secure the remaining 80 percent through bank loans and other means. The government has pledged to provide construction sites at no lease cost, as well as electricity, water, and other forms of support.
Abebe added that strong monitoring mechanisms will be implemented to ensure that companies do not mix these new projects with ongoing or past developments. A separate institution will be established to independently manage these new housing initiatives.
