The long-awaited land auction in Addis Abeba drew hundreds of developers eager to secure prime plots across the city, marking an event in the capital's urban development evolution. Over nine days last week, the auction presented a market for developers to bid on 22 plots in the recently demolished Piassa area in the Arada District. A total of 295 bidders vied for these "blank canvas" locations, but 40 bids were disqualified for not meeting the requirements, and two plots were withdrawn due to insufficient interest.

The Addis Abeba City Administration floated these plots, with over 90pc concentrated in four major districts.

Nifas Silk Lafto emerged as the most dominant, accounting for 53pc auctioned plots. Other allocations included Akaki Qaliti with 18pc, Kolfe Qeranyo at 10pc, and Addis Ketema at nine percent. The remaining 10pc of the plots were distributed among districts such as Qirkos and Arada. The plot areas varied significantly, with Nifas Silk Lafto offering between 373Sqm and 14,081Sqm.

The auction coincided with the City Administration's ambitious 48Km corridor development project, which expects to create new plots from recently cleared areas and further reshape the city. The initiative has generated considerable buzz, particularly in zones designated for new projects, including areas near the newly inaugurated Adwa ZeroKM Museum, Doro Maneqia, Mohammud Muziqa Bet, Eri Bekentu, and Qey Bahir Condominium.

According to an analysis conducted by the Urban Centre, an initiative of Yema Architecture, a consulting firm based in Addis Ababa, the auctions' financial impact is expected to be profound. Incorporated in 2007, YEMA initiated its Urban Centre project as an offshoot of a popular radio show, "Kebet Eske Ketema," hosted by Mahider G. Medhin.

The relationship between lease income, bidders' capital, and plot area range vividly depicts the auction's revenue potential. A pronounced spike in lease income correlates with higher land grade values. The city administration's decision to require bidders to provide 40pc of their bid as an initial deposit, with the remaining balance payable over five years, marks a shift from previous practices. The city authorities hope to streamline payments and enhance liquidity, moving away from the former 20-year payment period with extensions.

The city administration projects a substantial lease income of 140.4 billion Br over five years, with an initial revenue of 56.2 billion Br, constituting 40pc.

The geographical distribution of the plots shows a focus on neighbourhoods with substantial growth potential. Nifas Silk Lafto, with the highest plot allocation, stands out as a critical zone for future urban development, bolstered by its high land value and extensive plot areas. In contrast, areas like Gulele and Qirkos, with lower benchmark prices and fewer plots, might experience a slower growth trajectory.

Although individual bidders participated in last week's auction, established companies emerged as the dominant force to reckon with. Banks, insurance firms, and real estate giants fiercely competed for the most coveted plots. In one particular area near Shewa Hotel, adjacent to Teklehaimanot General Hospital, a record-breaking offer of 350,000 Br for a square metre was offered. Awash Bank secured a 977Sqm plot with an upfront payment of 311,000 Br for a square metre for a 60-year lease, outbidding an individual bidder, Habib Yusuf.

Tilahun Geleta, senior finance and facility manager at Awash Bank, expressed delight over securing the plot.

"We've already included it in our budget," he told Fortune.

The Bank plans to move its branch to the new five-story location a few hundred meters away.

The auction leveraged technology to facilitate the bidding process, making 4,200 documents for 242 plots available online and using Tele Birr, a mobile payment platform, to reduce crowds at the Land Development Bureau on Equatorial Guinea St., near the Lem Hotel area.

Ethio Reinsurance (EthioRe), the country's pioneer reinsurance firm, secured a 1,585Sqm plot near Qey Bahir Condominium with an offer of 102,213 Br for a square metre and a pledge to pay the total amount upfront. EthioRe outbid Samson Properties Plc for a square metre plot by 2,113 Br. Fikru Tsegaye, business and strategic planning executive at EthioRe, revealed plans to build EthioRe's headquarters on the site, incorporating a training centre for reinsurance companies.