uganda un common premises business case june 04 2015

25/3/2015

Gbade Sigismond SmithPROJECT MANAGER UN COMMON PREMISES

UN House Plot 11 Yusuf Lule Road Kampala Uganda

Business CaseGreen UN Common Premises Lubowa Uganda

BUSINESS CASE TEMPLATE VERSION 1.5

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Table of ContentsEXECUTIVE SUMMARY..................................................................................................................................... 2

EXECUTIVE SUMMARY:....................................................................................................................................2BENEFITS OF PROPOSED COMMON PREMISES:.................................................................................................4RISK & MITIGATION:.........................................................................................................................................4

BACKGROUND/ INTRODUCTION....................................................................................................................... 6

CURRENT SITUATION:......................................................................................................................................6RATIONALE FOR COMMON PREMISES:.............................................................................................................7COST REDUCTION NARRATIVE:.........................................................................................................................7SECURITY NARRATIVE:......................................................................................................................................8

AGENCIES REQUIREMENTS............................................................................................................................. 10

LIST OF PARTICIPATING AGENCIES:.................................................................................................................10NON- RESIDENT AGENCIES WITH SMALL STAFF THAT ARE PARTICIPATING:......................................................10DETAILED PROJECTED SPACE REQUIREMENTS & COST OF...............................................................................12Table I: Cost estimation..................................................................................................................................12TABLE II: MOSS REQUIREMENTS.....................................................................................................................15TABLE III: BUILDING OPTIONS.........................................................................................................................16Building Options...........................................................................................................................................16Ownership.....................................................................................................................................................16Rent...............................................................................................................................................................16

PROJECT DESCRIPTION................................................................................................................................... 17

SUMMARY:....................................................................................................................................................17SITE LOCATION:..............................................................................................................................................17PROJECT OBJECTIVES AND DESIRED OUTCOMES:............................................................................................17

Project scope and works required................................................................................................................................18WORKS:.........................................................................................................................................................18

COST/BENEFIT ANALYSIS................................................................................................................................ 20

SUMMARY.....................................................................................................................................................20ANALYSIS.......................................................................................................................................................21FIVE YEAR ANALYSIS.......................................................................................................................................22TEN YEAR ANALYSIS........................................................................................................................................2215 YEAR ANALYSIS..........................................................................................................................................23ASSUMPTIONS...............................................................................................................................................25

STRATEGIC ALIGNMENT & BENEFITS...............................................................................................................26

DELIVER AS ONE AND DELIVER GREEN............................................................................................................26BENEFITS.......................................................................................................................................................26

PROJECT RISK ASSESSMENT............................................................................................................................ 28

RISK ANALYSIS & MITIGATING MEASURES...................................................................................................... 28

SECURITY REPORT ON LUBOWA PREFERRED OPTION........................................................................................29

BUSINESS & OPERATIONAL IMPACTS.............................................................................................................. 30

ENVIRONMENTAL ASSESSMENT..................................................................................................................... 31

UGANDA UN COMMON PREMISES BUSINESS CASE PAGE 0 OF 65

TABLE IV: ENVIRONMENTAL MITIGATION AND MONITORING PLAN................................................................32

CONCLUSIONS & RECOMMENDATIONS........................................................................................................... 34

CONCLUSIONS................................................................................................................................................34RECOMMENDATIONS.....................................................................................................................................35

IMPLEMENTATION PROCESS.......................................................................................................................... 36

ANNEXES AND DIAGRAMS............................................................................................................................. 38

Annex 1 - Agency Requirements.....................................................................................................................39LIST OF PARTICIPATING AGENCIES:.................................................................................................................39LETTER OF INTEREST SIGNED BY ALL PARTICIPATING AGENCIES.......................................................................40Annex 2 - Financial Component......................................................................................................................42TABLE IX.1: RECURRING EXPENSES AT PROPOSED UN COMMON PREMISES ( BUILT UP SPACE OF 32,760. INCLUDING CARPARK )...................................................................................................................................42TABLE X.2: FIVE YEAR COST BENEFIT ANALYSIS TABLE COMPARING RENTAL PAYMENTS VERSUS LUBOWA CONSTRUCTION REPAYMENTS ( BUILT UP SPACE OF 32,760 INCLUDING CAR PARK).........................................42TABLE XI.2: TEN YEAR COST BENEFIT ANALYSIS TABLE COMPARING RENTAL PAYMENTS VERSUS LUBOWA CONSTRUCTION REPAYMENTS ( BUILT UP SPACE 32,760 INCLUDING CAR PARK)..............................................42TABLE XII.1: TWENTY YEAR COST BENEFIT ANALYSIS TABLE COMPARING RENTAL PAYMENTS VERSUS LUBOWA CONSTRUCTION REPAYMENTS (FOR THE OVERALL BUILT UP SPACE INCLUDING CAR PARK).............................43Annex 3 - Security.....................................................................................................................................46UN LUBOWA PROJECT SITE SRA......................................................................................................................46TABLE V: FINDINGS.........................................................................................................................................47TABLE VI: GENERAL THREAT CATEGORY / ENVIRONMENT...............................................................................49TABLE VII: SUMMARY OF SIGNIFICANT RISKS TO UN OPERATIONS (See SRA Matrix- UN Lubowa Project ..........51Annex 4 – MOA between Uganda Government and UN .......................................................................52

Annex 5 – Topographic Site Layout , Satelite images,Site photographs.................................................60 ANNEX 6- REAL ESTATE DATA ON OFFICES IN KAMPALA..............................................................................63


SectionEXECUTIVE SUMMARY1

UN House Common Premises Uganda

EXECUTIVE SUMMARY:

This business case has been developed to establish the economic viability of constructing a Green purpose built UN Common Premises at Lubowa 15 kilometers outside Kampala. This will in the long term provide rent free, MOSS security compliant accommodation, for the UN all Agencies and programs operating in Kampala. As opposed to the current situation in which UN agencies are scattered throughout the city leasing office accommodation separately from private individuals.

While value in cost reduction and enhanced security is critical, this business case recognizes the strategic long-term programmatic and operational benefits of a common premises. Physical co-location of UN agencies at the country level is a major catalytic component, enabling organizational reform that goes beyond the reduction of operating costs, to assisting in building management capacity and connected common services.

In anticipation of this opportunity the Uganda Green UN Common Premises will be designed to provide fit for purpose, open office accommodations that will encourage integrating programmatic and operational processes of co-locating UN entities beyond the immediate cost implications. Potentially this includes the opportunity of the consequent elimination of duplicated functions and a re-organization of the UN system according to its programmatic themes

A key stumbling block in the path of establishing a UN House’s has been funding , the UNCT Uganda has overcome this problem by working closely with its host the Uganda Government, in a Public Private Partnership (PPP) relationship with a semi private institution that has long term pension funds to invest in real estate . The Government of Uganda, and the National Social Security Fund (NSSF) of Uganda have agreed to undertake the funding of the construction of the UN common premises. The commitment is clear in the allocation to the UN a 30-40 acre parcel of land at no cost, within its proposed 565 acre diplomatic & residential real estate development at Lubowa outside Kampala. This site is designated for the construction of UN common premises.

The NSSF through a Private Public Partnership with UN Country Team (UNCT) and Uganda Government will fund the construction of the common premises. The cost of construction will be amortized by UNCT through payment of a fixed sum at 0% interest, payment starts at the end of the construction, for a period of not more than 15 years. After which the common premises will be handed over to the UN rent free. Anticipated construction period is 24 months including defects correction and handover. The common premises will consist of 5 interconnected buildings on three floors, designed to reflect the best practices of Green sustainable buildings including natural ventilation, solar power, water recycling, rainwater harvesting and sewage treatment that benefits the environment. The premises will be set in a lush green landscaped environment that is irrigated with recycled rain water from ponds with fish and local plants to enhance the sustainability of the premises.


The cost benefit analysis indicates that UN agencies currently occupy fourteen thousand five hundred and seventy nine (14578) square meters of office space and pay two million five hundred and sixty thousand nine hundred and sixty four million dollars ($ 2,563,964) in rent annually. Therefore UN is paying one hundred and seventy five dollars ($175) per square meter for internal office space this does not include insurance, parking and service charges. While At the proposed common premises the cost per square meter including parking, 30 acres of landscaped grounds, security is $17 per square meter. It is important to note that the fixed repayment amount on this project is USD 1,892,000 annually at 0% interest is for a total built up area of 30,000 square meters of purpose built Green office space in a secure prime location. Therefore UN will be paying USD 671,964 less annually than the current rental situation. The repayment by UN does not start until the end of the construction, after the defects liability period is over and when full handover is completed.

The analysis also indicates that overall current expenditure on premises which includes utilities .rental and maintenance for UN organizations in Kampala is over four million one hundred and twenty thousand dollars ($4,129,462) annually, and increases by 5% at each lease renewal (2 years). It is pertinent to note that the overall cost of leasing over nine years USD 37,165,158 million, would have paid for the cost of constructing the proposed common premises which is USD $ 36,716,559 million with a net positive balance of USD $ 448,599.00.

While at the proposed common premises the overall cost including fixed repayment, utilities and maintenance, would be USD 2,742,735.00 annually. Therefore In ten years the repayment is the order of USD 27,427,350million. While for the current leasing situation it is USD 41,294,620.00 million resulting in the significant savings of USD 13,867,270.00 million, which could be applied to fund urgent UN programs in Uganda. This analysis does not include the cost of replicating ICT and support services, and transport logistics, which is estimated at four hundred and fifty thousand dollars ($450,000) annually. When these cost are factored in the estimated cost of running the various premises occupied by UN agencies in Kampala is over four million five hundred and seventy three million dollars ($4,573,000) million annually.

Based on security reports and recent terrorist attacks on premises and staff including UN buildings in Nigeria, Somalia, Kenya, North Africa and Middle East, the need for the UN agencies to be located in premises that are fully MOSS compliant is urgent. Currently none of the premises occupied by UN organizations in Kampala comply with the security requirements of MOSS, thus increasing the risk and endangering the lives of UN personnel and Ugandan citizens. It is clear that the status quo should not continue. It is therefore essential to focus on a long term sustainable approach to accommodate UN agencies.

Uganda UNCT had considered two other options for locating the new premises namely Nakasero UN village and UNICEF property at Mbuya. However these were eliminated for the following reasons, there was no interest free financing to be structured for these locations. The 2-3 acres of land available was insufficient. Finally the locations could not be made compliant with MOSS security criteria. Hence we have focused on the 30 acre Lubowa site as our preferred option in this business case. (See annex for topographical map and the google satellite picture for location). The estimated office space, circulation and common areas is 12760 square meters. While external built up areas including, car parking, security stations, generator house, UNDSS, UN-clinic, cafeteria and storage facilities will be approximately 20,000 square meters bringing the total built up area 32,760 square meters sitting in a landscape campus of 30 acres (121,000 square meters) in extent. The cost of construction is estimated at USD 30,118,600 million. The total development cost including indirect cost, Architect/Engineers, contingencies, project consultants and procurement is estimated at USD 36,716,559.00 million, it estimated the project will take 24 -30 months to complete.


BENEFITS OF PROPOSED COMMON PREMISES:

The proposed Green Common Premises will allow the UN to improve safety and security for its staff, enhance the environmental sustainability and improve the UN carbon/climate footprint. Purpose built premise of this quality will help increase productivity, efficiency, motivation and innovation of the UN personnel and partners. It will create a valuable asset for the host government, creating a lasting legacy of environmentally sensitive buildings in the immediate community and the city at large. Furthermore it reduces the administrative burden for UN organizations and partners by saving time, effort and money spent in navigating the different systems utilized by each agency. The quantitative and expected qualitative benefits from the proposed Green UN Common premises are overwhelmingly in favor of the UN, these include but are not limited the following listed below:

Harmonized UN presence in the country promoting greater confidence in the ability of the UN to support Uganda’s sustainable social and economic goals.

UN agencies avoid financial risk associated with price hikes in real estate market and period rent increases of 5%. Accountability remains with participating UN agencies and risks are defrayed through efficient & objective management.

Reduce yearly recurring premises expenditure from $ 4.1million to $ 2.7 million with a saving of $1.4 million per year,USD 13.8 million, in 10 years and $ 27.6 million in 20 years.

Increased green credentials also offers the UN an opportunity to provide a more conducive and innovative work environment with acceleration of its transition to a lower carbon footprint globally. By the use of solar energy for water heating, use of special glass products to reduce UV exposure and environmentally friendly design that caters for the use of natural air to reduce the need for power generated air conditioning, and green spaces for recreation to improve staff wellbeing.

Efficient Security monitoring and coordinated response to issues is greatly enhanced at one location as opposed to several locations scattered throughout the city.

Purpose built office buildings in a secure location, with certainty that the premises and buildings meet and exceed MOSS requirement. Social amenities and landscaped environment to ensure superior work life balance.

Rent-free building with the UN being in full control of the quality of the development and the end product.

Efficiencies gained through services tied to common premises (cleaning/maintenance, guards, car pool, etc.) Increased financial accountability through transparency in reporting and retiring cost of services based on leveraging scale.

UN agencies benefiting from purpose-built premises including more useable space to be used for common facilities such as conference center which will save additional thousands in cost for outsourcing and renting conferencing venues.

RISK & MITIGATION:

The common premises project team has assessed a range of risks that could affect the success of the endeavor. The key risks were considered and assessed in the following categories Design, Construction, Implementation, Business Operations, and Political risk. The analysis and mitigation are outlined below;

Construction bondsMany things can go wrong in a large construction/refurbishment project. Bearing this in mind, construction bonds, also called construction surety bonds or contract bonds, are a mandatory prerequisite for any project beyond a certain size. This proposed common premises would use the construction bond to mitigate risks such as an adverse climatic event that causes disruptions, failure to complete the project due to insolvency of the builders, or the job’s failure to meet contract specifications.

Design riskTo minimize cost exposure within the design process, the Project team will assembled a design team that has significant real estate project development experience. All project architects and engineers will adhere to


design standards compatible with international best practice. The project team will also adopt UN standard set of modules (beams, columns sizes etc.), which will be used in the design of all structures.

Construction riskUsually manifests itself in the construction price variations, quality of materials and workmanship and program delay. To mitigate the effect of this risk, we will require that the construction of all work packages are procured via a series of fixed price contracts. The Construction Company will develop a program of quality assurance measures which include locating quarries for aggregate and sand (to ensure quality of materials), training program for staff and labor who will be employed on the Project and building an ample ‘float’ into the construction program

Implementation riskThere will be ‘Implementation Risk’ if the Project Team is unable to smoothly transition from the construction phase to operating phase. A smooth transition depends on all systems having been tested and passed, the marketing program being effective and successful and the ongoing operations teams being in place from the first day. To this end we will keep the implementation plan simple and our implementation team as small as efficiently possible.

Business & operations riskIn recent years, the exchange rate between the US dollar and the Shilling has been relatively constant (1 US dollar shilling 2850). Nonetheless, it cannot be assumed that this exchange rate will remain constant in the future. We therefore propose to raise all capital required in US dollars, pay for the all the construction works in US dollars. After the start of operations, we will continue to be exposed to fluctuations in the value of the Shilling to Dollar exchange rate. In order to mitigate this we will establish the financial plan on the US Dollar. All remittance by the UN to amortize the construction cost is paid directly to the Financier.

Political risk Uganda has continued to consolidate democratic rule, and now enjoys a more open society. As a result of these and other political achievements, Uganda outperforms 65% of African countries on measures of civil liberty, political rights and political stability, the country has been ranked, amongst the top 15 reformers globally by the World Bank's Doing Business team. The Government may default on its agreement with the developer or financier. While the UN system may be shielded from financial exposure, there may be a risk of eviction. This is mitigated in our proposal by ensuring that all remittance by the UN to amortize the construction cost is paid directly to the Financier.

.FUTURE REVENUE CENTER

While not included in this proposal, it is important to advise that the UN consider the Inclusion of recreation facilities and a conference center. This would be both strategic and financially pragmatic, as revenue centers both will generate significant income to supplement the cost of maintenance of the common premises. The conference center will save the UN system considerable amounts that are current spent renting venues for conferences sponsored by the UN. The proximity to the airport and Serena Victoria hotel ensure that there will be a steady inflow of patronage for the conference center,Similarly the recreation center will be a membership based facility open only to the diplomatic community and other vetted members charging annual fees to all who use it. Both facilities will be located outside the security perimeter of the common premises with their own security arrangements to allow none UN member’s access without entering the main premises.

These facilities would ensure an optimum work life balance and increase productivity at the common premises for all UN personal and partners. Reducing stress and worry over meeting is critical. It also reduces the time and money lost in commuting between the common premises and various venues in Kampala which is a major cost saving for UN system


SectionBACKGROUND/ INTRODUCTION2

In response to the UN Secretary General’s appeal to Member States to establish UN Houses, the Government of Uganda over 12 years ago offered land at Lubowa to the UN system for the construction of a UN House. The Working Group responded to the Government at that time stating that the UN System was not in a position, both for managerial and financial reasons, to undertake construction of a UN House. The Working Group suggested that should the Government be in a position to deliver a turnkey project, i.e., not only allocate land but identify an financier who would pay for all development and construction costs for the UN House, it would favorably consider such a proposal.

CURRENT SITUATION:

Currently, UN organizations in Kampala are paying rent, with the exception of FAO which has been provided rent-free accommodation by the Government. The current yearly recurring premises expenditure of UN organizations in Kampala is over $4.1 million per annum this is for premises which don’t comply with MOSS, or disabled user requirements and do not reflect UN space guidelines for open plan office.The UN organizations are scattered throughout the city, negatively impacting on security and inter-agency coordination. Reliable security reports indicate a high threat of Terrorist attacks on premises including UN buildings. The recent incidents in Somalia, Kenya, Nigeria, Middle East and Pakistan highlight the urgent need for the UN agencies to be located in premises that are fully MOSS compliant.

In order to achieve this objective, the Resident Coordinator (RCO) has hired a Project Manager (PM) for the UN Common premises to work closely with UN Agencies and the Government to coordinate all aspects of the project. The Ugandan Government as part of its input has allocated 30 acres of land and identified a financier to fund the construction of the Common Premises. This financier National Social Security Fund (NSSF) is a semi government agency and is the custodian of social security contributions for Uganda. NSSF is mandated to invest money in secure risk adverse projects including real estate development. The RC/UNCT has identified UNDP as the lead agency in this Common Premises effort. If competitive UNOPS may be the UN agency on the procurement of Construction services for the project.

The Government has reconfirmed that through NSSF it has allocated 30-40 acres of land at no cost to the entire UN System in Kampala, and had also succeeded in identifying a financier NSSF which is prepared to pay for construction of the common premises at 0% interest. While Utilizing a Public Private Partnership Funding arrangement in which the UN, NSSF and Government are partners. UN Agencies will amortize the cost of construction by paying an agreed sum to NSSF for a number of years. Once the NSSF has been repaid for funding the construction, the building and Land would be owned by the Government/UN, to be made available to the UN System rent-free, where only maintenance and operating costs would be the responsibility of UN organizations.


RATIONALE FOR COMMON PREMISES:

The consolidation of all UN Agencies into one UN House (Common Premises) is an important component of the UN Secretary General's reform program “delivering as One UN”. A single UN House fosters security, unity, coordination and cost efficient delivery of the mission at the country, regional and global level. While value in cost reduction and enhanced security is critical, this business case for the establishment of a UN Common premises, recognizes the long-term programmatic and operational benefits. The Physical co-location of UN agencies at the country level is a major catalyst, component in enabling organizational reform that goes beyond the reduction of operating costs, to assisting in building management capacity and some connected common services.

Hence the Uganda Green UN Common Premises will be designed to provide the open plan office accommodations that will encourage integrating programmatic and operational processes of co-locating UN entities beyond the immediate cost reduction benefits. The feasibility includes the opportunity to consequently eliminate duplicated functions and facilitate a re-organization of the UN system according to its programmatic themes

The critical and urgent issues such as security and escalating rental cost have added impetus to the drive and commitment of the Uganda UNCT to seek endorsement for the construction of a common UN premises. Additionally there are issues of work life balance, energy conservation, environmental sustainability and Green building agenda of the UN. These can be articulated under cost reduction and security as key elements in the rational for the construction of a new common premises

COST REDUCTION NARRATIVE: Cost Benefit Analysis indicates that the proposed new common premises over a five year period is $6,986,833.00 more economic than the existing leasing option, discounted to present day values in terms of costs. Over Ten year period it is 13,867,270.00 million more economic than the existing leasing option, discounted to present day values in terms of costs.There are several factors contributing to cost reduction at the proposed new premises, these include the absence of the following standard charges which are levied by landlords in Kampala real estate market ; Service charge $4/sq.m, Parking fees $50 per slot, 5% Escalation every 2 years or at renewal of lease . Greater negotiating leverage with service providers including, Cleaning, Garbage collection, Gardening, Power supply, Water, Maintenance and Security, because the co-location of several agencies at one location translates to a larger scale and better bargaining power. The positive consequence of a new smart building is that we need less maintenance hence lower cost. Water conservation and recycling to reduce cost of water. Cross ventilation eliminates use air conditioners reduces cost of electricity. Renewable energy using photo voltaic solar panels on the roof for powering the building and technology for regulating use of electricity reduces utility cost. These key factors make the Lubowa Green common premises more energy efficient and much cheaper to run and maintain.

Potentially relocation to a new common premises will provide opportunity to re-focus administrative and management processes to be more cost effective by introducing new IT platforms and software, that will facilitate monitoring and evaluation of the operational effort at the country level. Leading to streamlining operational process, and reducing direct monetary cost for example it will be possible to leverage UN System wide bargaining position when procuring goods and services for agencies under one roof. Introduction of software such as BOSS (Business Operational Strategy System) that comes with a suite of operational instruments which allow for enhanced identification of cost benefits of different initiatives, allowing facts based decision making and prioritization would be possible at the Common Premises


Specific cost reductions:

With regards to the project, the cost benefit analysis indicates that the UN would immediately reduce its annual expenditure on rent alone by USD 671,599 when it moves to the common premises. This is because the fixed repayment amount on this project is USD 1,892,000 annually at 0% interest .While with the current rental situation, the UN is paying USD 2,563,964 with a 5% increase every two years for office space which does not have car parking or a perimeter security buffer zone that is MOSS compliant. In contrast at the proposed common premises the UN is getting 12760 square meters of purpose built Green office space plus 20,000 square meters of external built up areas including car park for staff and visitors, security post, storage facilities, rain water recycling, sewage treatment and PV solar power set in 30 acres of harmonized landscaped environment in a secure prime location. In this scenario the UN cost per square meter is estimated at USD 17 per square meter which is below the market rate for A grade office space in Kampala.The cost benefit analysis indicates that total current expenditure on premises which includes rental, utilities, and maintenance for UN organizations in Kampala is over four million one hundred and twenty thousand dollars ($4,129,462) annually, and increases by 5% every two years. It is pertinent to note that the overall cost of leasing over nine years USD 37,165,158.00 million, would have paid for the cost of constructing the proposed common premises which is USD 36,716,559.00 million with a balance of $448,599 left over. While at the proposed common premises the overall cost including fixed repayment, utilities, car parking, gardening and maintenance would be USD 2,742,735 annually. In ten years the repayment is the order of USD 27,427,350million. Resulting in the significant savings of USD 13,867,270.00 million, when compared with USD 41,294,620 which would be paid out in ten years in the rental scenario. This saving could be applied to fund urgent UN programs in Uganda. This analysis does not include the cost of replicating ICT and support services, including transport logistics, which is estimated at four hundred and fifty thousand dollars ($450,000). When this cost is factored in the estimated cost of running the various premises occupied by UN agencies in Kampala is over four million five hundred and seventy three million dollars ($4,573,000) million annually.

Further cost reduction would be realized from the following;

Eliminating the recurring high cost of relocating and converting residential buildings to offices to meet UN standards.

Eliminate the recurring high cost of trying to make the individual properties MOSS compliant. Eliminate cost of logistics and Transportation to move from one Agency location to another within

the very congested traffic in Kampala. And reduce loss of productive man hours because of difficulty of coordination between different agencies and in some case the same agency with multiple location.

The common Premises provides the opportunity of reducing the cost of funding for local Security due to the reduction in number security personnel on duty at the common premises

Reduction of duplication of work processes at the agency level by providing the service through a single channel, rather than decentralized at the agency level (example ICT, Travel and building maintenance);

Reduction of transaction costs (time spent on activities) for the UN and partners, including the host government, due to harmonized operational procedures and standing agreements with vendors (e.g. VISA processes and Joint Long Term Agreements);


SECURITY NARRATIVE:

The lethal attacks on UN personnel and premises by terrorist over the last 8 years including the most recent in Somalia 2015 on UNICEF staff, Mogadishu 2013, Abuja 2011, WFP office Pakistan 2009, Algiers 2007 and Baghdad earlier is a stark reminder of the security risk facing the UN staff and local citizen in the vicinity of the UN premises. The following can be argued in favor of the common premises:

The UN security management system is more effective in a common premises: As it stands now because Agencies are scattered all over Kampala, separate premises security structures will continue to exist, with a continuing potential for duplication and potentially dangerous confusion. A purpose built UN Common Premises addresses this concern.

Security Information and Communications Technology: Information technology is not a luxury; it is a central instrument for delivery of security services. At the common premises the opportunity exists for a shared robust ICT center that will cater for the ICT requirement of UNDSS.

Enhancing Security execution: One common premises reduces the challenge of operationalizing The Framework for Accountability and Creating a Culture of Security, This part of the responsibility for the well-being of UN Personnel and their Dependents. Supports Host Government efforts in carrying out their security responsibilities: Establishing a common premise strengthens the central element of the cooperation and trust between the two sides and makes information sharing about security conditions more efficient. Crisis Management and Response center: At the common premises the addition of a properly staffed and resourced 24/7 Crisis Management/Operations Centre capable of serving the entire Uganda UN security community would greatly increase the crisis response capacity of DSS and enhance program effectiveness. Safety: Safety and security are mutually-reinforcing halves of the goal of improving Personnel and Premises and emergency medical preparedness. This is better managed at one common premises Safety is a vital aspect of the mandate of the Department of Safety and Security. DSS has indicated that safety, particularly air safety, fire safety, and road safety, is a priority.


SectionAGENCIES REQUIREMENTS 3

LIST OF PARTICIPATING AGENCIES:

1. UNDP/ RCO2. WHO3. WFP4. UNHCR5. IOM6. UNWOMEN7. UNAIDS8. UNFPA9. OHCHR10. UNICEF

NON- RESIDENT AGENCIES WITH SMALL STAFF THAT ARE PARTICIPATING:

11. UNESCO12. MUNESCO13. UNDSS14. IFAD15. UNCLINIC16. PULSE LAB17. UNIDO

The first table below shows the projected requirements based on the TTCP template and the UN office space planning guide lines for more efficient utilization of space with open planning. The second table shows the current space utilization data received from all the participating agencies in response to the survey carried out in February 2015


Participating UN Agencies Office Space requirements summary

UN Agencies Projected Space requirements

AgencySigned

letter of interest

JIU space matrix SQM overall office staff number

UNDP/RCO Yes Projected 1846 115WFP Yes Projected 1600 100

UNICEF Yes Projected 2720 170UNHCR Yes Projected 1920 120OHCHR Yes Projected 352 22

UNAIDS Yes Projected 352 22UNFPA Yes Projected 1040 65

UNWOMEN Yes Projected 560 35WHO Yes Projected 1120 70IOM Yes Projected 1250 80

Projected space 12760 799Total includes space for non-resident UN agencies

UN Agencies Current Space requirements

AgencySigned

letter of interest

JIU space matrix SQM overall office staff number

RCO Yes Received 316 12WFP Yes Received 1901 95

UNICEF Yes Received 3142 160UNHCR Yes Received 1901 101OHCHR Yes Received 493 17

UNAIDS Yes Received 337 17UNDP Yes Received 2000 84

UNFPA Yes Received 1500 65UNWOMEN Yes Received 643 25

WHO Yes Received 763 54IOM Yes Received 1575 74

TOTAL space used 14578 723This Includes space for non-resident UN agencies


DETAILED PROJECTED SPACE REQUIREMENTS & COST OF Estimated project cost These are estimates provided by UNOPS are based on the preliminary space calculations table provided by TTCP. Accurate figures will be determined from detailed drawings and bills of quantities.

Table I: Cost estimation Item Description Size Unit Rate Amount

(USD)Remarks

1 Office Spaces (i) Office Space projections

FOR 10 UN Agencies that signed letter of interest using TTCP template

11,796 Square Meters

850 10,026,600 Include additional space for growth and non-resident agencies

(ii) Board RM/ 2 large conference rooms, 8 Small meeting rooms

1,500 SM 600 900,000 2 small meeting rooms per building

(iii) Amenities ‐ toilets, resource areas, Janitors closet,

600 SM 600 360,000 Includes disable toilets

(iv) 4 safe rooms for personnel during attacks

800 SM 700 560,000 including food storage communication, toilet , air-conditioning emergency access

(v) Backup security control and radio room

170 600 102,000

(vi) ICT switch and data rooms

200 600 120,000

Subtotal 12,068,600

2 Support Spaces (i) UN Clinic 1100 SM 600 660,000 Derived from

data provided UN clinic

(ii) UN DSS 1100 SM 600 660,000 Derived from areas provided by UNDSS

(iii) External covered Large gathering area

1200 SM 600 720,000 IOM,UNHCR refuge spaces, and training

(v) Reception Building 200 SM 600 120,000 (vi) Radio Room 50 SM 600 30,000 (vii) Security Equipment

Room100 SM 600 60,000

(viii) Archives and File Storage

150 SM 600 90,000


Item Description Size Unit Rate Amount (USD)

Remarks

(ix) Bulk Stores 800 SM 600 480,000 (x) Generator/Transformer

Room120 SM 750 90,000

xi Driver waiting area 200 SM 600 120,000 (xii) Child Care Centre 100 SM 600 60,000 (xiii) UNFCU Bank 200 SM 600 120,000 (xvi) External Safe Room 400 SM 600 240,000 Subtotal $3,450,000

3 Cafeteria (i) 2 NO. Cafeteria

Including Kitchen and Storage

600 SM 600 360,000

Subtotal $360,000Item Description Size Unit Rate Amount (USD) Remarks

4 Site Work and Services Site Work Size Unit Rate Amount USD

(i) Driveways 10000 SM 75 750,000 (ii) Parking 20000 SM 75 1,500,000 (iii) Generators and Fuel Tanks

(2No.)2 NR 200000 400,000

(iv) Bulk Storage & Overhead Pressed Steel Water Tank(including extraction, treatment and reticulation)

1 SUM 1200000 1,200,000

(v) Site Sewer Treatment Plant & reticulation System

1 SUM 1000000 1,000,000 Assumed 2km of sewer line

(vi) WIFI and Telephony 1 SUM 400000 400,000 Provisional Sum

(vii) Landscape development 1 SUM 500000 500,000 Provisional Sum

(viii) Security and Surveillance 1 SUM 550,000 550,000 Provisional Sum

(ix) Environmental conservation development

45000 SM 10 450,000 Assumed 45% of plot area

(x) Data Centre 100 SM 650 65,000 (xi) Vehicle Washing Bay 200 SM 450 90,000 (xii) Public/Common Toilets 100 SM 900 90,000 (xii) Gate/Guard House 100 SUM 100000 100,000 (Assumed 2

No) (xiv) Boundary Wall complete with

electric fence1700 LM 500 850,000 Approximate

Perimeter for 30 Acres

(xv) Chain Link fencing & Razor wire

1700 LM 100 170,000 Approximate Perimeter for 30 Acres

(xvi) Boom Gates 5 NR 5000 25,000 (xv ii)

Vehicle Security Access Control System

1 Item 600000 600,000 Provisional Sum

Subtotal 8,740,000

5 Interior Design (ID)


Item Description Size Unit Rate Amount (USD) Remarks(i) Partitioning & Ceiling(ii) Structured Cabling & ICT(iii) Blinds & Netting(iv) Panels & work Stations(v) Loose furniture? Agencies (viii) Filing cabinets & compactors(ix) Fire suppression, back-up (x) Tilling & Painting Sub Total 5,500,000

Construction Cost 30,118,6006 Indirect Cost

(i) Fibre connectivity, Environmental tech control systems , Renewable Energy, Water recycling

1,174,979

(ii) 10% Architects, Engineers, QS, Landscape, Project management and procurement

3,615,320

(iii) Add 5 % Preliminaries & Contingencies, Insurance, legal, finance

1,807,660

TOTAL ESTIMATED COST

$ 36,716,559

TABLE II: MOSS REQUIREMENTSMOSS REQUIREMENTS COST/USD

Security requirements - Perimeter wall at least 2.5 meters high with

Electric/razor wire on top- Perimeter intrusion detection- Building intrusion detection system- CCTV- Baggage scanner- Police guards/security guards- Screening equipment (Wall through door/hand

held metal detectors)- Compound/facility lighting- Physical security of access points (windows and

doors)-bars, SRF, locks etc.- Biometric/electronic access control- Blast/ shatter Resistant Films- Safe Haven/safe room (reinforcement type)- Lightening arrestors- Intercom- Alarms/public address system- Firefighting and suppression system (fire alarms,

fire plan, sensor, smock detectors, fire extinguishers, hoses/sprinklers, water supply)

- Anti-ram devices/barriers/blocks/bollards- Main gate (Sliding gate/hinged- automated)- Cross bar/drop arm barriers- Vehicle access control- Pedestrian access control- Vehicle parking (official, staff and visitors)- ID system- Key control (office/vehicles)- Mail delivery and screening- Building standoff distance- Vehicle standoff distance from building- Power supply (national grid/generator)


- Fuel (storage and type)- Emergence communication- Guard house

Note the security requirement are an integral part of the project, the cost is included in the overall project estimate.

$4,270,000

TABLE III: BUILDING OPTIONS

Building Options Ownership Rent

1

Lubowa Site: This plot of land is owned by the NSSF and is located some 15 kilometers from the city center on the main Kampala-Entebbe Highway. In this option there are three parties namely UN, Uganda Government and National Social Security Fund (NSSF) its Public Private Partnership.

National Social Security Fund (NSSF) as financier. Uganda government facilitates the allocation of 30 acres of land from NSSF to UN. While UNDP/UNOPS manage procurement of Project manager, Architects, Engineers, interior designers, contractors and supervise construction process. On Completion of construction UN occupies the premises and commences amortization of the cost of construction through annual payments to the NSSF. NSSF is responsible for providing operations and maintenance (O&M) over the project life cycle or until the loan is fully amortized.

Land is owned by NSSF. Transferred to Government for offer to UN which has use of land in perpetuity as long as UN is in Uganda

At the end of construction period , UN pays, fixed sum to amortize cost of construction.

When the cost of construction fully is amortized. UN possession has Rent-free.

2 Nakasero Site: Government owned land with residential accommodation for UN staff village built by UN. The land is small (under 2 acres). Current buildings will have to be demolished leading to loss of income to UNDP. Land size will require the building of a multi-story tower block increasing cost. And it cannot qualify for planning approval for security reason. Mainly because of its proximity to the Uganda President’s state

Property owned by Government /UNDP

UN pays rent at commercial rates to UNDP in perpetuity. Construction will not attract interest free funding, hence repayment is with full interest to private developer.


Building Options Ownership Rent

house it will pose a security threat to the Uganda president. This Option is not viable

3

Mbuya Location: UN warehouse Premises owned by Government/UNICEF and sub-leased by some UN agency from UNICEF. Land is also small. Not very accessible. Land is small and on a slope increase cost of development. Proximity to Nakawa court make it not compliant with MOSS requirements house adds additional security challenges. . Financing of construction will be by private developer on commercial terms that attracts full market interest rates. This option is not viable.

Property owned by Government/UNICEF

UN pays rent at commercial rates to UNCEF in perpetuity. Construction will not attract interest free funding, hence repayment is with full interest to private developer


SectionPROJECT DESCRIPTION4

SUMMARY:

The project will be designed utilizing JIU standards for UN common premises, the goal is to provide a Green purpose built UN Common Premises at Lubowa 15 kilometers outside Kampala. Which ensures appropriate office accommodations facilities for UN agencies and in the long term is rent free. This will be a MOSS security compliant accommodation, for the UN Agencies and programs operating in Kampala as opposed to the current situation in which UN agencies are scattered throughout the city leasing office accommodation separately from private individuals, in Kampala with attendant security challenges and high cost implications.

The Government of Uganda, through National Social Security Fund (NSSF) of Uganda has allocated to the UN a 30 acre piece of land, within its proposed diplomatic & residential real estate development. This site is designated for the construction of UN common Premises.

The NSSF through a Private Public Partnership with Uganda UN Country Team (UNCT) and Uganda Government will fund the construction of the common premises. The cost of construction will be amortized by UNCT through payment of subsidized rent for a period of not more than 30 years. After which the common premises will be handed over to the UN. Anticipated construction period is 24 months including defects correction and handover.

SITE LOCATION:The Location proposed is at Lubowa in Wakiso district, Uganda and is situated some 15 kilometers from Kampala city center off the main Kampala-Entebbe Highway. The site is between the Lubowa- Lubugumu to Batabata road and Lubowa - Lweza roads, with a view of the lake on the North and the South, West and East boundaries are residential estates on hills. (See Annex 8 for site location co-ordinates and diagrams)

The master site owned by NSSF consists of 563 acres and is currently proposed as the location of a major 3000 residential units and commercial real estate development by NSSF. 30-40 acres of this land has been earmarked for the UN House. It is thus a prime opportunity for the UN System to identify its needs. The Government, is prepared to finance any major upgrading of roads, electricity, sewage, etc. in order to accommodate the UN. NSSF have offered to finance the construction of the UN common compound.

UNDP shall be lead Agency and project managers for the common premises. The procurement service required are Architectural/engineering design, Quantity surveyors detailed tender/contract documents, procurement of construction services and implementation this can addressed as follows. UNOPS is been considered for some of the procurement services.

PROJECT OBJECTIVES AND DESIRED OUTCOMES:Objectives The objective of this project is to design and construct the first Green UN common compound in Uganda to provide a sustainable working environment for the UN staff which best promotes programmatic and functional efficiencies. It shall be built to include all facilities necessary to meet relevant international construction industry standards and UNDSS applicable codes while adding security service screening building facilities and providing adequate parking spaces.

Expected Outcomes

The establishment of a new UN common compound that enhances staff productivity by providing a better, healthier and safer work environment.


Project scope and works required The scope shall include;

Procurement and contracting of necessary construction works Preparing the detailed works design, drawings and other specifications in accordance with the

UN design requirements, and its internal rules, regulations and policies including any of its applicable design planning manuals.

Preparing the construction and procurement strategy for undertaking the works. Procuring the Works in accordance with the construction and procurement strategy and its

rules, regulations and policies, including its Procurement Manual. Supervising the construction of the Works, implementing and supervising of Civil & Electro-

Mechanical Works in accordance with its rules, regulations and policies, including its Works Contract(s), and completing the Project in accordance with the terms of the MOU, including notifying defects to the Contractor(s) during the Defect Notification Period(s) and ensuring that such defects are properly rectified.

Supervising handing over the Works to UNDP upon Substantial Completion of the Works Contractor shall not be responsible for their operation and maintenance beyond the defects notification period.

Obtaining and managing any design and/or construction permits/approvals and any permit/certificate required from the authorities upon Final Completion of the Works.

WORKS:

C – Civil (site) work External utility distribution networks (power, gas, water) External sewerage network External storm water drainage network Exterior lighting Access roads Parking Landscaping

S/A – Structural and Architectural work Foundations Structural frame Seismic upgrade (renovation project only) Building envelope (exterior walls, windows, exterior doors and roof)

M/P – Mechanical and Plumbing work Heating, ventilation and air conditioning (HVAC) system Interior gas distribution system Lifts Freight Lifts Interior plumbing and drainage system Plumbing fixtures

E – Electrical work Power distribution system Interior lighting system Emergency power supply (generator & connection cables) UPS (including connection cables)

FP – Fire Protection workUGANDA UN COMMON PREMISES BUSINESS CASE PAGE 18 OF 65

Fire protection sprinkler system (if required) Fire protection reservoir and water distribution system Exterior hydrant network Fire protection water distribution network (external and internal) Fire/smoke detection systems Fire alarm system

SS – Special Systems LAN PABX Video conferencing system

SEC – Security Systems Window safety films Perimeter fence (if required by MOSS) CCTV Anti-intrusion alarm system Public address system Any other items included in the security assessment

ID – Interior Design Interior partitions Interior finishes (e.g. doors, drop ceiling, etc.) Common furniture Blinds Movable partitions (e.g. system furniture)

Engineering Support Project management (planning, design, construction and commissioning phases) Design


SectionCOST/BENEFIT ANALYSIS5

SUMMARY

This cost benefit analysis has been developed to establish the economic viability of developing a Green purpose built Common Premises at Lubowa 15 kilometers outside Kampala. Which in the long term will provide rent free accommodation, after amortization of construction cost for the UN all Agencies and programs operating in Kampala. As opposed to continuing to lease office accommodation separately from private individuals, at exorbitant rents. The cost benefit analysis indicates that UN agencies currently occupy fourteen thousand five hundred and seventy eight (14578) square meters of office space and pay two million five hundred and sixty thousand nine hundred and sixty four million dollars ($ 2,563,964) in rent annually. Therefore UN is paying one hundred and seventy five dollars, sixty seven cents ($175.67) per square meter for internal office space only this does not include parking. With rent increase of 5% every two years or on renewal of lease. The analysis indicates that at the proposed common premises the fixed repayment at 0% interest would be USD $1,892,559.00 annually for an overall built up area of 32,760 square meters which includes internal office space, parking , UN clinic, Rain water recycling, sewage treatment perimeter security stations and buffer zone , landscaped gardens, and walking trails. Thus resulting in immediate savings of USD $ 671,964 in rental expenses for a purpose built Green premises in a secure prime location. The repayment by UN does not start until the end of the construction, after the defects liability period is over and when full handover is completed.

The analysis also indicates that overall current expenditure on premises which includes utilities .rental and maintenance for UN organizations in Kampala is over four million one hundred and twenty thousand dollars ($4,129,462) annually, and increases by 5% at each lease renewal (2 years). It is pertinent to note that the overall cost of leasing over nine years USD 37,165,158 million, would have paid for the cost of constructing the proposed common premises which is USD $ 36,716,559 million. With a balance of USD 448,599 left over.While at the proposed common premises the overall cost including fixed repayment, utilities and maintenance would be USD 2,742,735.00 annually. Therefore In ten years the repayment is the order of USD 27,427,350.00 million. While for the current leasing situation it is USD 41,294,620.00 million resulting in the significant savings of USD 13,867,270.00 million, which could be applied to fund urgent UN programs in Uganda. This analysis does not include the cost of replicating ICT and support services, and transport logistics, which is estimated at four hundred and fifty thousand dollars ($450,000) annually. When these cost are factored in the estimated cost of running the various premises occupied by UN agencies in Kampala is over four million five hundred and seventy three million dollars ($4,573,000) million annually

Ideally as part of its obligations to the UN the host government provides appropriate accommodation with security to the UN agencies in the country. In this case, the Uganda Government (UG) does not have the resources (financial or infrastructure) to provide the UN with free accommodation that meets UN security criteria. However UG has provided land free of charge at Lubowa and facilitated negotiations with a developer for joint efforts to develop UN’s own offices in Uganda. The proposal is for the Government of Uganda to provide land and identify a developer National Social Security Fund (NSSF) who will fund the project. At the end of construction after full handover the UN would pay back through a fixed sum at 0% interest, following amortization of the construction cost the property will be rent free to the UN. There is a strategic incentive for the NSSF to offer the interest free financing to the UN. Specifically the UN presence attracts foreign embassy tenants to the diplomatic enclave proposed as part of NSSF’s 563 acre high end real estate development and this enhances the value of the real estate.

Uganda UNCT had considered two other options for locating the new premises Nakasero UN village and UNICEF property in Mbuya. However both were eliminated for the following reasons,

1. There was no interest free financing to fund the development 2. land area available was insufficient 2-3 acres3. The locations did not meet UN security criteria.

Hence we have focused on the 30 acre Lubowa site as our preferred option in this analysis. See the attached topographical map and the google satellite picture for location. The estimated office space, circulation and common areas is 12760 square meters. While the external built up areas including, car parking, rain water recycling sewage treatment, security stations, cafeteria and storage facilities will be approximately 20,000 square meters bringing the total built up area 32,760 square meters sitting in a landscape campus of 30 acres (121,000 square meters) in extent. The cost of construction is estimated at


USD 30,118,600 million The total development cost including Architect/Engineers, contingencies, project consultants and procurement is estimated at USD $ 36,716,559 million, the project construction will take 24 -30 months to complete.

The ten year analysis indicates that the present day overall cost of leasing under the existing lease will be in the order of USD 41,294,620.00 million, whilst the ten year cost of repayment on a common premises built to UN specifications, will be in the order of USD 27,427,350 million showing a saving in the order of USD 13,867,270.00 million. It is important to note that the overall cost of leasing over ten years USD 41,294,620.00 million, would have paid for the total cost of constructing the proposed common premises which is USD 36,716,559.00 million. With a net positive balance of USD 4,578,061.00. In addition to this saving on costs, qualitative analysis indicates additional savings and benefits from harmonized and shared ICT platforms, improved work life balance from green eco-friendly campus, and common facilities at the 30 acre site. Overall the report concludes that the economics of the UN moving into its own premises are very positive; in the first five years significant savings of approximately USD 7,000,000 million will be realized and over ten years these savings amount to approximately USD 14,000,000 million. As the occupancy extends to a period beyond of 18 years then the rent free period, will result in a only nominal running cost for the UN in present day terms.

ANALYSISThe objective of the analysis is to compare the current situation of renting office space with the proposal for the construction at Lubowa of a new common premises. The standard principals of cost benefit analysis have been applied with a present day value being applied to all calculations with a discount factor of 3.5% being deemed fair and reasonable.

The analysis indicates that currently the UN pays USD 2,563,964 annually, at the proposed common premises the fixed repayment would be USD $1,892,559.00 annually resulting in immediate savings of USD $ 671,964.00 in rents.

TABLE VIII: CURRENT RENT AND EXPENSES BY PARTICIPATING UN AGENCIES IN KAMPALA FEASI BILI TY STUDY

Prepared on: By:

UNDP/ RCO UNFPA UNICEF WFP UNHCR UNAIDS WHO IOM UNWOMEN OHCHR Totals

No. 138 45 160 95 101 12 54 74 25 17 721% 19.14% 6.24% 22.19% 13.18% 14.01% 1.66% 7.49% 10.26% 3.47% 2.36% 100.00%m2 2,316.00 1,500.00 3,142.00 1,901.00 1,908.00 337.00 763.00 1,575.00 643.00 493.00 14,578.00% 15.89% 10.29% 21.55% 13.04% 13.09% 2.31% 5.23% 10.80% 4.41% 3.38% 100.00%

UNDP/ RCO UNFPA UNICEF WFP UNHCR UNAIDS WHO IOM UNWOMEN OHCHR Sub-Totals

$ 384,000.00 $ 221,400.00 $ 377,040.00 $ 589,387.00 $ 285,600.00 $ 108,821.00 $ 280,164.00 $ 84,000.00 $ 91,952.00 $ 141,600.00 $ 2,563,964.00 $ 25,992.00 $ 15,000.00 $ 41,248.00 $ 36,000.00 $ 40,913.00 $ 2,268.00 $ 14,097.00 $ 6,329.00 $ 5,000.00 $ 11,524.00 $ 198,371.00 $ 1,030.00 $ 873.00 $ 2,223.00 $ 1,550.00 $ 821.00 $ 147.00 $ 622.00 $ 500.00 $ 450.00 $ 400.00 $ 8,616.00 $ 377.00 $ 320.00 $ 813.00 $ 567.00 $ 300.00 $ 54.00 $ 228.00 $ 100.00 $ 200.00 $ 200.00 $ 3,159.00 $ 102,000.00 $ 21,622.00 $ 36,000.00 $ 15,819.00 $ 60,000.00 $ 21,503.00 $ 30,000.00 $ 18,810.00 $ 58,038.00 $ 36,042.00 $ 399,834.00 $ 19,968.00 $ 38,193.00 $ 125,000.00 $ 74,040.00 $ 35,911.00 $ 6,419.00 $ 27,210.00 $ 21,678.00 $ 13,005.00 $ 5,492.00 $ 366,916.00

$ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 8,629.00 $ 3,797.00 $ 96,665.00 $ 144,400.00 $ 7,033.00 $ 638.00 $ 10,238.00 $ 1,860.00 $ 5,000.00 $ 1,056.00 $ 279,316.00 $ 59,800.00 $ 35,000.00 $ 55,880.00 $ 38,968.00 $ 41,000.00 $ 15,765.00 $ 15,641.00 $ 12,000.00 $ 14,016.00 $ 21,216.00 $ 309,286.00

$ 601,796.00 $ 336,205.00 $ 734,869.00 $ 900,731.00 $ 471,578.00 $ 155,615.00 $ 378,200.00 $ 145,277.00 $ 187,661.00 $ 217,530.00 $ 4,129,462.00

Current Cost / m2 283.27$

Power Supply

19/ 4/ 2015

Lease

Gbade SmithCurrent SituationAnnual Recurring Cost Pro-Ration Sheet

Services

Cost Calculation Parameters

Totals

Employees

Area

CleaningGarbage collection & recycling

Security (premises only)Water Supply

Gardening

Gas Supply

Maintenance


Abdi Hussein, 06/04/15,

Can table be enlarged. Hard to read figures

Analysis indicates that at the present day cost of leasing including utilities, cleaning and maintenance under the existing lease arrangements UN pays in the order of USD 4,129,462 million.Whilst the cost of repayment including utilities, cleaning and maintenance at the proposed common premises at Lubowa, built to UN specifications will be in the order of USD 2,742,735.00 million showing a saving in present day terms of USD 1,386,727.00.million annually.

TABLE IX: REPAYMENT AND EXPENSES AT PROPOSED UN COMMON PREMISES BY PARTICIPATING UN AGENCIES

U.N. House / Common Premises

FEASIBILITY STUDY

Prepared on: By:


No. 115 65 170 100 120 22 70 80 35 22 799% 14.39% 8.14% 21.28% 12.52% 15.02% 2.75% 8.76% 10.01% 4.38% 2.75% 100.00%m2 1,846.00 1,040.00 2,720.00 1,600.00 1,920.00 352.00 1,120.00 1,250.00 560.00 352.00 12,760.00% 14.47% 8.15% 21.32% 12.54% 15.05% 2.76% 8.78% 9.80% 4.39% 2.76% 100.00%


$ 273,717.24 $ 154,206.90 $ 403,310.34 $ 237,241.38 $ 284,689.66 $ 52,193.10 $ 166,068.97 $ 185,344.83 $ 83,034.48 $ 52,193.10 $ 1,892,000.00 $ 14,467.08 $ 8,150.47 $ 21,316.61 $ 12,539.18 $ 15,047.02 $ 2,758.62 $ 8,777.43 $ 9,796.24 $ 4,388.71 $ 2,758.62 $ 100,000.00 $ 1,447.29 $ 815.37 $ 2,132.51 $ 1,254.42 $ 1,505.30 $ 275.97 $ 878.09 $ 980.02 $ 439.05 $ 275.97 $ 10,004.00 $ 1,252.85 $ 705.83 $ 1,846.02 $ 1,085.89 $ 1,303.07 $ 238.90 $ 760.13 $ 848.35 $ 380.06 $ 238.90 $ 8,660.00 $ 14,766.70 $ 8,319.27 $ 21,758.08 $ 12,798.87 $ 15,358.65 $ 2,815.75 $ 8,959.21 $ 9,999.12 $ 4,479.61 $ 2,815.75 $ 102,071.00 $ 43,401.25 $ 24,451.41 $ 63,949.84 $ 37,617.55 $ 45,141.07 $ 8,275.86 $ 26,332.29 $ 29,388.71 $ 13,166.14 $ 8,275.86 $ 300,000.00

$ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 11,573.67 $ 6,520.38 $ 17,053.29 $ 10,031.35 $ 12,037.62 $ 2,206.90 $ 7,021.94 $ 7,836.99 $ 3,510.97 $ 2,206.90 $ 80,000.00 $ 36,167.71 $ 20,376.18 $ 53,291.54 $ 31,347.96 $ 37,617.55 $ 6,896.55 $ 21,943.57 $ 24,490.60 $ 10,971.79 $ 6,896.55 $ 250,000.00

$ 396,793.79 $ 223,545.80 $584,658.24 $343,916.61 $ 412,699.94 $ 75,661.66 $ 240,741.63 $ 268,684.86 $ 120,370.82 $ 75,661.66 $ 2,742,735.00

Recurring Cost / m2 214.95$

Employees

Area

Services

Lubowa Kamapala, Uganda

Gbade Smith


Annual Recurring Costs Pro-Ration Sheet Option I Lubowa New Construction19/ 4/ 2015

Totals

LeaseCleaningGarbage coll. & recyclingGardeningMaintenancePower SupplyGas SupplyWater SupplySecurity (premises only)

Please note the reduction in Recurring Cost / m2 from $283.27 in the current situation, to $214.95 in the proposed development. It’s important to observe that when the essential external built up areas including car parking at the proposed new premises is added to the analysis the Recurring Cost / m2 at the proposed development reduces further to $83.72 per square meter, while the cost of repayment and maintenance remains constant. (See annex 4 table IX.1) This indicates clearly that at new premises the UN will be getting more value while paying significantly less.



Is it possible to enlarge table to see figures more clearly

FIVE YEAR ANALYSIS

The five year analysis indicates that the present day cost of leasing and operating under the current situation will be in the order of USD 20,647,319.00 million. Whilst the cost of repayment on a new building at Lubowa built to UN specifications, over five years, will be in the order of USD 13,713,675.00 million showing a saving in the order of USD 6,933,944.00 million. This is a significant amount which could be used to fund UN programs in Uganda.

TABLE X.1: FIVE YEAR COST BENEFIT ANALYSIS TABLE COMPARING RENTAL PAYMENTS VERSUS LUBOWA CONSTRUCTION REPAYMENTS

Prepared on: 19/ 4/ 2015 By:3.25% 5.00

i (1+i)n 0.0381(1+i)n -1 0.1734

Current Situation Lubowa New Construction

Nakasero New Construction

Mbuya New Construction

Annual Recurring Costs $4,129,462.00 2,742,735.00$ -$ -$ N/A -$ -$ -$

$4,129,462.00 2,742,735.00$ -$ -$ $20,647,310.00 13,713,675.00$ -$ -$

14,578.00 12,760.00 14,578.00 14,578.00

$283.27 214.95$ -$ N/ A -$ -$ -$

$283.27 214.95$ -$ -$ $1,416.33 1,074.74$ -$ -$

$ 36,716,559 is the total estimated cost of development including Architects/Engineering fees & contigencies for Lubowa new construction option

TOTAL COSTS / m2

Gbade Smith

OPTION COMPARISON

TOTAL ANNUAL COSTS

TOTAL ANNUAL COSTS / m2

Total Space (m2)

Annual Cost of Capital I nvestment

Cost/ m2 (capital investments)Cost/ m2 (annual recurring costs)

TOTAL COSTS

Lubowa Kamapala, UgandaU.N. House / Common Premises

Annual factor for investment cost calculation =

Option Cost ComparisonFEASI BI LITY STUDY

0.2199

US Treasury current discount rate, per Year (i): Project Duration (years, max 7) (n):

TEN YEAR ANALYSIS The ten year analysis indicates that the present day cost of leasing and operating under the existing lease will be in the order of USD 41,294,620.00 million whilst the cost of repayment and operating a common premises built to UN specifications, over ten years, will be in the order of USD 27,427,350.00 million showing a saving in the order of USD 13,867,270.00 million which could be applied to fund UN programs.

Equally significant is the fact that the overall cost of leasing over nine years USD 37,166,158 million, would have completely paid for the cost of developing the proposed common premises which is USD 36,716,559.00 million with a net positive balance of USD 448,599.00

TABLE XI.1: TEN YEAR COST BENEFIT ANALYSIS TABLE COMPARING RENTAL PAYMENTS VERSUS LUBOWA CONSTRUCTION REPAYMENTS


Prepared on: 19/ 4/ 2015 By:3.25% 10.00

i (1+i)n 0.0447(1+i)n -1 0.3769





$4,129,462.00 2,742,735.00$ -$ -$ $41,294,620.00 27,427,350.00$ -$ -$

14,578.00 12,760.00 14,578.00 14,578.00

$283.27 214.95$ -$ N/ A -$ -$ -$

$283.27 214.95$ -$ -$ $2,832.67 2,149.48$ -$ -$


TOTAL COSTS / m2

Gbade Smith

OPTION COMPARISON

TOTAL ANNUAL COSTS


Total Space (m2)



TOTAL COSTS



Option Cost ComparisonFEASIBI LITY STUDY

0.1187


15 YEAR ANALYSISThe 15 year analysis indicates that the present day cost of leasing under the existing lease will be in the order of USD 61,941,930.00 million whilst the cost of repayment and operating the proposed premises built to UN specifications, over fourteen years, will be in the order of USD 41,141,025.00 million showing a significant saving in the order of USD 20,800,905.00 million.

TABLE XII : 15 YEAR COST BENEFIT ANALYSIS TABLE COMPARING RENTAL PAYMENTS VERSUS LUBOWA CONSTRUCTION REPAYMENTS

Prepared on: 19/ 4/ 2015 By:3.25% 15.00

i (1+i)n 0.0525(1+i)n -1 0.6157





$4,129,462.00 2,742,735.00$ -$ -$ $61,941,930.00 41,141,025.00$ -$ -$

14,578.00 12,760.00 14,578.00 14,578.00

$283.27 214.95$ -$ N/ A -$ -$ -$

$283.27 214.95$ -$ -$ $4,249.00 3,224.22$ -$ -$ TOTAL COSTS / m2

Gbade Smith

OPTION COMPARISON

TOTAL ANNUAL COSTS


Total Space (m2)



TOTAL COSTS



Option Cost ComparisonFEASI BILITY STUDY

0.0853


Please also note the reduction in Total Cost / m2 for the 5 year scenario from $1,416 in the current situation, to $1,074 in the proposed development. This indicates clearly that at the proposed new premises the UN will be getting more value while paying significantly less.

ADVANTAGES OF PROPOSED GREEN UN COMMON PREMISES Harmonized UN presence in the country promoting greater confidence in the ability of the UN to support

Uganda’s sustainable social and economic goals


UN agencies avoid financial risk associated with price hikes in real estate market and period rent increases of 5%. Accountability remains with participating UN agencies and risks are defrayed through efficient & objective management

Reduce yearly recurring premises expenditure from $ 4.1 million to $ 2.7million with a saving of $1.4 million per year and approximately $ 28 million in 20 years

Increased green credentials also offers the UN an opportunity to provide a more conducive and innovative work environment with acceleration of its transition to a lower carbon footprint globally. By the use of solar energy for water heating, use of special glass products to reduce UV exposure and environmentally friendly design that caters for the use of natural air to reduce the need for power generated air conditioning, and green spaces for recreation to improve staff wellbeing

Efficient Security monitoring and coordinated response to issues is greatly enhanced at one location as opposed to several locations scattered throughout the city


Rent-free building with the UN being in full control of the quality of the development and the end product

Efficiencies gained through services tied to common premises (cleaning/maintenance, guards, car pool, etc.) Increased financial accountability through transparency in reporting and retiring cost of services based on leveraging scale

Efficient UN project management minimizes operational risks while UN agencies benefiting from purpose-built premises

The twenty year analysis indicates that once the cost of construction is amortized the building is paid for then the costs to the UN are reduced to operating and utilities expenses only

Additional benefits in terms of general working conditions such as single occupancy, customized space planning, security, safety, flexibility and in house conference facilities

It should be noted that the costs and benefits of the proposed UN Common Premises option would normally be considerably influenced by the issues of cost and availability of funds to finance the construction. The impact of interest rates, taxes on the expenditure profile and the accumulation of equity in the purchase of property, however, this does not apply in this case because of the 0% interest free funding negotiated with NSSF and the unique exemptions and privileges available to the UN.

DIS-ADVANTAGES OF NEW CONSTRUCTION Property management becomes the owner’s liability. The costs of owning a property are more fragmented in terms of rates, insurance, maintenance of the

building, maintenance of equipment and general servicing such as cleaning and security. Possibility of restricted mobility should the needs of the institution change.

ADVANTAGES OF RENTING As a tenant, the institution can relocate at the end of the lease.

DISADVANTAGES OF RENTING As a tenant, the institution may be forced to relocate at the end of the lease. Market dictates rentals in the long term. The rent paid by UN agencies in Kampala increases by 5% at each renewal. There is no residual value accruing to the UN as the property value appreciates over time


Q4 2014 Economic Statistics: Annual Core Inflation 6.7%

Real GDP 4.7% Growth Annual Headline 1.8%

Real GDP per Capita 1.1%

CBR January 11% 2015 Average Exchange Ugx 2,854

91 day T-bills 180 day364 day

10.56%, 12.31% and 12.09%

Economic Indicators 1. Uganda Inflation Rate 2014 — 6.95 %.2. Currency exchange Rate – 2850.00 Uganda shillings to USD $1.00 3. Interest rate for real estate development 20-22 %4. A grade office rentals in Kampala – USD $22.00 per square meter.5. C grade office rentals in Kampala- USD $14 per square meter.6. Property rental increase in Kampala- 5% every two years.7. Property management- Taken as 7% of equivalent rentals.

CONCLUSION

The tables indicate that new build over a five year period is $6,986,833.00 more economic than the existing leasing option, discounted to present day values in terms of costs. Over Ten year period is 13,867,270.00 million more economic than the existing leasing option, discounted to present day values in terms of costs. And over Twenty year period is $25,574,540.00 more economic than the existing leasing option, discounted to present day values in terms of costs.

However, there are additional benefits in terms of general working conditions such as single occupancy, customized space planning, security, safety, flexibility which can be valued over the periods. In addition the building itself will have accumulated value/equity over the period. From the above it can be seen that the proposed Green Common Premises option at Lubowa is in the order of S $$6,986,833.00 million more economic overall in 5 years and $25,574,540.00 more economic in twenty years.


SectionSTRATEGIC ALIGNMENT & BENEFITS6

DELIVER AS ONE AND DELIVER GREENThe consolidation of all UN Agencies into one UN House (Common Premises) is an important component of the UN Secretary General's Delivering as One and deliver Green reform program. A single UN House fosters harmonization, productivity and co-ordination in work at the country level. The Green UN Common will represent a model for Uganda and other countries in the region demonstrating the viability of innovative sustainable buildings and is an important component of the UN climate change advocacy. It is clear that the eco-friendly and team-friendly Green UN House for all UN organizations is essential to integration, coordination and the realization of greater synergies. The impetus for the intended move to a new premises was informed by the exorbitant cost of accommodation in Kampala and the security risk. The UN as an institution has strict criteria in terms of safety, security and reductions in costs at its facilities. Concerted efforts have been made by the UNCT in Uganda to find accommodations that satisfies this criteria, unfortunately there are no existing or under construction office building in Kampala that meet the criteria. UN agencies have had to convert existing building, incurring higher cost, in the process only to find that the conversions, don’t meet half the security criteria required for compliance with MOSS.

BENEFITS Green Common Premises will allow the UN to improve safety and security for its staff, enhance the environmental sustainability of the UN buildings and improve the climate footprint of UN AFPs on the way to climate neutrality. Such tailor made buildings will help increase productivity, efficiency, motivation and innovation of the UN personnel and partners. It will create a valuable asset for the host government that creates a lasting legacy of environmentally friendly buildings in the immediate community and the city at large. Furthermore it reduces the administrative burden for UN organizations and partners by saving time, effort and money spent in navigating the different systems utilized by each agency.

The quantitative and expected qualitative benefits from the proposed Green UN Common premises are overwhelmingly in favor of the UN. A harmonized UN presence in the country promoting greater confidence in the ability of the UN to support Uganda’s sustainable social and economic goals. The benefits also include the following;

UN agencies avoid financial risk associated with price hikes in real estate market and rent increases of 5%. Accountability remains with participating UN agencies and risks are defrayed through efficient & objective management.

Reduce yearly recurring premises expenditure from $ 4.1million to $ 2.7 million with a saving of $1.4 million per year and $ 28 million in 20 years.

Increased green credentials also offers the UN an opportunity to provide a more conducive and innovative work environment with acceleration of its transition to a lower carbon footprint globally..


Purpose built office buildings in a secure location, with certainty that the premises and buildings meet and exceed MOSS requirement. Landscaped environment to ensure superior work life balance.

Rent-free building with the UN being in full control of the quality of the development and the end product


Efficient UN project management minimizes operational risks while UN agencies benefiting from purpose-built premises.

Disadvantages Property management becomes the owner’s liability. Short term costs can be much higher than rentals. Possibility of restricted mobility should the needs of the institution change.


SectionPROJECT RISK ASSESSMENT7

Risk Analysis & Mitigating Measures

IntroductionThe Project Team has considered a range of events that could affect its ability to either create the asset and/or realize revenues from the asset. The key risks were considered and assessed in the following categories Design, Construction, Implementation, Business Operations and Political risk. The analysis and mitigation are outlined below

Design riskTo minimize cost exposure within the design process, an experienced design team that has at least 20 years of real estate project development experience will be assembled . All project architects and engineers will adhere to design standards compatible with UN/international best practice. The project team will also adopt a standard set of modules (beams, columns sizes etc.), which will be used in the design of all structures.

Construction riskUsually manifests itself in the construction price variations, quality of materials and workmanship and program delay. To mitigate the effect of this risk, we will require that the construction of all work packages are procured via a series of fixed price contracts. The Construction Company will develop a program of quality assurance measures which include locating quarries for aggregate and sand (to ensure quality of materials), training program for staff and labor who will be employed on the Project and building an ample ‘float’ into the construction program

Construction bonds

Many things can go wrong in a large construction/refurbishment project. Bearing this in mind, construction bonds, also called construction surety bonds or contract bonds, are a mandatory prerequisite for any project beyond a certain size. This proposed common premises would use the construction bond to mitigate risks such as an adverse climatic event that causes disruptions, failure to complete the project due to insolvency of the builders, or the job’s failure to meet contract specifications.

Implementation RiskThere will be ‘Implementation Risk’ if the Project Team is unable to smoothly transition from the construction phase to operating phase. A smooth transition depends on all systems having been tested and passed, the marketing program being effective and successful and the ongoing operations teams being in place from the first day. To this end we will keep the implementation plan simple and our implementation team as small as efficiently possible

Financial, Business & Operations RiskIn recent years, the exchange rate between the US dollar and the Uganda Shilling has been relatively constant (1 US dollar to UG shilling 2850). Nonetheless, it cannot be assumed that this exchange rate will remain constant in the future. We therefore propose to raise all capital required in US dollars, pay for the all the construction works in US dollars. After the start of operations, we will continue to be exposed to fluctuations in the value of the UG Shilling to Dollar exchange rate. In order to mitigate this we will establish the financial plan on the US Dollar and receive revenues from sales in US Dollars until completion at which time the exchange rate (excluding financing costs) would be determinable

Political RiskUganda has continued to consolidate democratic rule, and now enjoys a more open society. As a result of these and other political achievements, Uganda performs well as compared to African countries on measures of civil liberty, political rights and political stability. Security RiskHigh probability of terrorist attack, this is addressed by making sure that all aspects of the proposed common premises comply fully with all UN MOSS requirements. And that during construction 24 hour electronic surveillance and security presence is maintained on site at all times.



You are talking about Ghana here, not Uganda!!


Has this really happened already?? Project is still in conceptual stage.

Section SECURITY REPORT ON LUBOWA PREFERRED OPTION8

A COMPREHENSIVE SECURITY ASSESSMENT WAS CONDUCTED IN 23-03-2015 SEE ANNEX 5

The UNDSS carried out an initial security assessment of the suitability of the site for the proposed UN House in Lubowa, with a team of 5-7 Security Officers led by the Security Adviser visited the site on 16.09.2014; a more comprehensive security assessment was conducted on 23-03-2015(See Annex 5.)

Observations from initial assessment:

- The entire piece of NSSF land was about 500 acres, 30 of which has been offered by the Government to the UN, for the UN house project.

- The 30 acres were offered based on the estimations obtained from agencies and programs.- There is a valley in the middle reserved by NEMA as recreational ground/green and on the

layout some plots are demarcated; however this is not part of the UN-demarcated plot.- Various UN teams had visited the site before; and 3 options of plots had been identified

with different developments and environmental considerations.- Agencies and programs had been contacted in the past, to submit their space requirements

and specifications.The SA clarified that the visit was not a security assessment and added that a security assessment would be carried out at a later stage, with the availability of more information relating to the project such as building plans, boundary marks etc.

Recommendation;

The Security Cell, having evaluated the accessibility, neighborhood, terrain and topography, unanimously agreed that the selected location was ideal for the implementation of the UN common premises. However;

Security considerations should be of paramount importance right from the beginning of the project, starting with structural to the architectural designs to avoid gaps and security lapses at later stages.


Gbade Smith, 06/04/15,


Blank page. Need to format.

SectionBUSINESS & OPERATIONAL IMPACTS9

A harmonized UN presence in the country enhance the capacity of the UN agencies to deliver on the UNDAF. Simultaneously promotes a unified image, giving greater confidence in the ability of the UN to support Uganda’s sustainable social and economic goals. UN agencies avoid financial risk associated with price hikes in real estate market and periodic rent increases of 5% every two years. Accountability remains with participating UN agencies and risks are defrayed through efficient & objective management. The business and operational impacts are highlighted below ;

Reduce yearly recurring premises expenditure from $ 4.1million to $ 2.7 million with a saving of $1.4 million per year and approximately $ 28 million in 20 years.

Increased green credentials also offers the UN an opportunity to provide a more conducive and innovative work environment with acceleration of its transition to a lower carbon footprint globally.

The use of solar energy for water heating, use of special glass products to reduce UV exposure and environmentally friendly design that caters for the use of natural air to reduce the need for power generated air conditioning, and green spaces for recreation to improve staff wellbeing.



Rent-free building with the UN being in full control of the quality of the development and the end product.


Efficient UN project management minimizes operational risks while UN agencies benefiting from purpose-built premises.

The twenty year analysis indicates that once the cost of construction is amortized the building is paid for then the costs to the UN are greatly reduced to running and service expenses only.

Additional benefits in terms of general working conditions such as single occupancy, customized space planning, security, safety, flexibility and in house conference facilities.


SectionENVIRONMENTAL ASSESSMENT10

Following a preliminary review of the planned housing development by NSSF at Lubowa in Wakiso District, environmental impacts were identified by a firm in 2012. Potentially significant impacts largely arise due to the scale and location of the development. Measures to address these have already been catered in design and other project planning narratives to mitigate these environmental and social consequences.

The major areas of concern regarding the environment at Lubowa include:

1. Flow of traffic given the location is surrounded by institutions and residences; this being an important issue both during the construction and operation phases of the Development. Construction traffic may be particularly frustrating.

2. Limited road access with only the Entebbe – Kampala road servicing the greater 3. Lubowa development.4. Limited potable water supply by the National Water and Sewerage Corporation (NWSC) 5. Lack of domestic waste treatment facility 6. Limited power supply


7. Noise nuisance during construction phase 8. Dust is likely to be a major problem during the construction phase, causing deterioration of

the quality of housing in the immediate vicinity of the development site. 9. Soil erosion is likely to occur given the gradient of the site; leading to siltation of wetlands

and streams at the bottom of the site.

However, most if not all of the above have now been responded to either by government providing additional services e.g. road networks, improved water and electricity connectivity as well as health and safety e.g. fire service.

TABLE IV: ENVIRONMENTAL MITIGATION AND MONITORING PLAN


SectionCONCLUSIONS & RECOMMENDATIONS11

CONCLUSIONS

The Uganda UNCT has selected the option that maximizes effectiveness and efficiency while minimizing risk and cost. And complying with the requirements of UNDSS and MOSS to make every effort to safe guard the lives of UN staff by been prepared against terrorist attacks.

With the repayment period starting after completion of construction and defects liability period , the tables indicate that the proposed Green UN common premises, over a five year period is USD 6,933,944.00 million more economic than the existing leasing option, discounted to present day values in terms of costs. Over Ten year period is USD 13,867,270.00 more economic than the existing leasing option, discounted to present day values in terms of costs. And over fourteen year period is USD 19,414,178.00 more economic than the existing leasing option, discounted to present day values in terms of costs.

However, there are additional benefits in terms of general working conditions such as single occupancy, customized space planning, security, safety, flexibility and in house conference facilities which can be valued over the periods. In addition the building itself will have accumulated value/equity over the period. From the above it’s clear that the proposed Green Common Premises option at Lubowa is in the order of USD 6,933,944.00 million more economic overall in 5 years and USD 19,414,178.00 more economic in fourteen years.

Two other options were explored by the UN country team in Kampala , after due diligence, the preferred solution, identified by the UNCT to address this critical situation, is to build a Green UN Common Premises on 30 acres of land provided by the Uganda Government at Lubowa. The Ugandan government as part of its commitment has allocated 30 acres of land and identified a financier to fund the construction of the Common Premises this financier is a semi government agency called National Social Security Fund (NSSF) which is the custodian of social security contributions for Uganda and is mandate to invest this money in secure risk averse projects including real estate development. The UNCT has identified UNDP as the lead agency in this Common Premises initiative and, a project manager to coordinate and manage the selection of consultants and contractor for the construction process. UNOPS is one of the UN agencies considered for the procurement services for the project. Benefits

The proposed Green Common Premises will allow the UN to improve safety and security for its staff, enhance the environmental sustainability of the UN buildings and improve the climate footprint of UN AFPs on the way to climate neutrality. Such tailor made buildings will help increase productivity, efficiency, motivation and innovation of the UN personnel and partners. It will create a valuable asset for the host government that creates a lasting legacy of environmentally buildings in the immediate community and the city at large. Furthermore it reduces the administrative burden for UN organizations and partners by saving time, effort and money spent in navigating the different systems utilized by each agency.

The quantitative and expected qualitative benefits from the proposed Green UN Common premises are overwhelmingly in favor of the UN moving to the proposed common premises at Lubowa. The Benefits include the following:

1. Harmonized UN presence in the country promoting greater confidence in the ability of the UN to support Uganda’s sustainable social and economic goals

2. UN agencies avoid financial risk associated with price hikes in real estate market and constant rent increases of 5% every 2 years. Accountability remains with participating UN agencies and risks are defrayed through efficient & objective management.

3. Reduce yearly recurring premises expenditure from $ 4.1million to $ 2.7 million with a saving of $1.4 million per year and approximately $ 20 million in 14 years.


4. Increased green credentials offers the UN an opportunity to provide a more conducive and innovative work environment with acceleration of its transition to a lower carbon footprint globally.

5.The use of solar energy, harvesting rainwater, recycling water, use of special glass products to reduce UV exposure and environmentally friendly design that caters for the use of natural air to reduce the need for power generated air conditioning, and green spaces for recreation to improve staff wellbeing.

6. Efficient Security monitoring and coordinated response to issues is greatly enhanced at one location as opposed to several locations scattered throughout the city.

7. Purpose built office buildings in a secure location, with certainty that the premises and buildings meet and exceed MOSS requirement. Social amenities and landscaped environment to ensure superior work life balance.

8. Rent-free building with the UN being in full control of the quality of the development and the end productEfficiencies gained through services tied to common premises (cleaning/maintenance, guards, car pool, etc.) Increased financial accountability through transparency in reporting and retiring cost of services based on leveraging scale.

9.Efficient UN project management minimizes operational risks with UN agencies benefiting from purpose-built premises.

RECOMMENDATIONSWe recommend the full implementation of the proposed Green Common Premises for the following reason critical reasons

1. This would save the UN USD 1.4.million annually, and over USD 6.9 million dollars in five years, and over $ USD 13.8 million in 10 years, over 20 million dollars in 15 years.

2. Enhance safety and security of UN personnel, by ensuring that the premises occupied by the UN agencies are compliant with the requirements of the UN safety and security services. (UNDSS)

3. The interest free financing negotiated with NSSF has a time limit. The opportunity to negotiate the same terms will depend on the new board of NSSF who may not be so favorable disposed to these terms

4. The cost of construction materials fluctuates with inflation therefore its best to implement the whole project to ensure the price is fixed by procuring in bulk.

While these reasons are clearly pertinent, collectively there is an urgency that needs to be recognized communicated. The eminent risk of terrorist attacks in Kampala brings a level of crisis to the immediate need to construct a UN premises that is MOSS security compliant. The dire need to fund programs is under threat from scarce funding resources, this makes it a matter urgency to implement a building project that will make USD 20 million more funds available for urgent programs in the Uganda. The ICT synergies achieved at one common premises are compelling, both in terms of money saved and the security advantages gained from surveillance of the physical as well as information environment. The scale achieved enables the negotiation of better prices on Bandwidth and internet services is significant and has been estimated at over $500,000 a year which is $10,000,000 in twenty years. It becomes clear that in 15 years just from savings there will be over USD 30,000,000 million more dollars available for urgent UN programs


Section PROJECT IMPLEMENTATION PROCESS & STRATEGY12

The Project Implementation Process has six phases – Concept; Design; Documentation; Tender; Construction and Review. The project manager provides leadership and manages the detail requirements during each phase of construction and procurement

1 Concept: The project manager and architects design team develops the project brief and concept options to the point where there are sufficient details to demonstrate that the preferred concept design is viable and acceptable to the Lead Agency and end users, the costs are within the agreed budget and any critical timelines will be met.2 Design: This includes developing the approved concept design to a high level of design detail through schematic design and design development. The design professionals contribute their expertise to ensure the design meets the functional and legislative requirements as well as UN standards.3 Documentation: Takes the developed design and prepares the detailed drawings and specification that will form the basis of the construction contract, including the preparation of the conditions of tendering and contract.4 Tender: Includes establishing a tender field, calling tenders, evaluating tenders received and making recommendations for acceptance of tenders. Calling and evaluating construction tenders is carried out in accordance with the tendering process, and a final approval for budget and expenditure is obtained and approval to enter into the contract is obtained before awarding the construction contract(s).5 Construction: Includes the on-site activities by construction personnel, contractors and subcontractors that result in a new asset. There are specific requirements to be met in the construction and commissioning of building asset. Progress of construction and timely response to issues as they arise are important elements of effective management during this high risk, high expenditure phase of construction projects.

Strategy The success of the project is enhanced by Identification and Mitigation of risk, which has been articulated in section 2-3 earlier in the business case. The mandatory requirements such as a cost ceiling for the construction cost, obtaining a construction bond from the contractors and inclusion of comprehensive insurance policies throughout construction. That Uganda Government will insure the premises and carry out major and structural repairs throughout the post-construction life cycle of the proposed common premises is a fundamental part of the implementation strategy. The project manager will coordinate the implementation of all the elements of the strategy as highlighted below;

Procurement Controlling the cost of the project with a fixed ceiling on the cost of construction is key and by the efficient and effective procurement of consultancy services, construction contractors and building materials is critical to successful the delivery of the project within budget and on time. It is proposed that UNOPS manages the procurement process to increase accountability and transparency and to support UN internally generated revenue. Over all our strategy on procurement seeks to fully utilize the scale of the project to procure at manufacturers prices. leveraging large bulk shipments to negotiate preferred freight rates. will reduce cost of transportation from Mombasa to a bonded warehouse in Kampala. A key component to delivering the project within budget is utilizing the UN tax free status to drive further cost reductions

Pre-construction ImplementationThe efficient pre-construction implementation strategy, starts with development of the project plan, selection of the project management team, design consultants, contract type tender documents and building contractor and specialist sub-contractors to manage and execute the construction.

Contract management

The selection of the contract type and management process are critical, it allows the project manager to track and manage the clauses, terms, conditions and commitments throughout the life of the various contracts pre-construction , during construction and after the completion of the construction to maximize business benefits and minimize risks. Working In cooperation with the UNDP procurement office, the


project manager, manages the tender process, selection and engagement of the parties to whom the various contracts will apply.

6 Review: Includes feedback about products, processes and asset performance to develop design, construction and market intelligence to benefit future infrastructure or building projects. It includes ensuring all construction work has been completed appropriately and there is a smooth handover of the asset to the end users or asset managers. It also includes monitoring the performance of the asset, generally for 12 months, and making adjustments as required in response to operational or end user issues.

Project Execution

The execution of a project consists of the processes used to complete the work defined in the project plan to accomplish the project’s requirements. The execution process involves coordinating people and resources, as well as integrating and performing the activities of the project in accordance with the project management plan. The deliverables are produced as outputs from the processes performed, as defined in such a framework.

The purpose of project execution is to deliver the project’s expected results. The objective of the construction phase is to build the project to drawings and specifications at the quality level indicated in the documents, within the budget, schedule and scope defined and approved by the UN. The contractor is responsible for facilitating the delivery, installation and construction of the project in coordination with project management and the design consultant’s team.

Monitoring and controlling project execution

Monitoring and controlling consists of the processes performed to observe project execution so that potential problems can be identified in a timely manner and corrective actions can be taken, when necessary, to control the execution of the project. The key benefit is that project performance is observed and measured regularly to identify variances from the project management plan.

Reporting on progress in executing the project

Progress reports are important in tracking the project’s progress. They are snapshots of the status of the project, as they disclose project data at different points of a project’s life. Organizations may decide to set them at key points in the project to check whether the project is advancing according to the schedule.

Auditing

Historically, internal audit review of construction projects focused on contract administration, i.e. compliance with contract terms, auditing payment applications, change orders, identifying cost recovery opportunities. These classic cost-focused audit activities are important; however, the most important business focus of construction projects is timely completion schedules and construction quality. Auditors can add value by ensure that there is frequent auditing of the project as well as adequate follow-up and prompt action on the implementation of the audit recommendations.

Taking over and commissioning

Taking over occurs when the works are, for all intents and purposes, completed and ready to be utilized by the end user. Although taking over is often referred to as substantial completion, it is not always the case that the works are completely finished. The project manager should engage with the facilities management services at an early stage and should seek agreement on all appropriate milestones and actions for the development of maintenance requirements and project handover processes.

Defects notification period and final completion

The defects notification period is the time period between taking over and the final completion of the works. The defects notification period is granted to allow sufficient time for any defects to be detected and fixed. Therefore, this period should be long enough to allow for the completed refurbishment/construction works to pass through one seasonal cycle or a full cycle of use. Generally, the defects liability period should include at least one year of observation during the first period of life of the completed project after its delivery.

Final completion is the end of the contractor’s obligation or responsibility. At this point, the contractor prepares to make the final handover. This is a critical stage where the project manager and his team will assist the United Nations system organizations take the necessary steps to ensure efficient coordination,


before returning the bank guarantee and making the final payment. After all this the repayment of the construction and development cost will commence

Maintenance of Common Premises Facilities Significant reductions in facility operating, maintenance and repair costs without negatively affecting service quality and service levels, starts with high quality pre-construction planning, design, specification and construction management. Ensuring the quality of service to the UN agencies throughout the lifecycle of the common premises after construction is enhanced by consolidation of responsibilities relating to non-core business support services; Continuity in facility-related administrative and operational processes/procedures; Enhancing services while increasing levels of internal occupant satisfaction is the goal. Working closely with procurement and UN Administrative Services Department (ASD) the UNCT Uganda would out engage the services of a competent facilities manager to strictly monitor the quality of service provided by private professional facilities management companies who provide ,cleaning, garbage collection, building repairs ,electrical, plumbing etc. Essentially this process would be outsourced and but managed internally, outlined below is a strategic overview of what would be expected in terms of management and maintenance of Common Premises Facilities after construction.

• Maximize limited budgets; Achieve operational efficiencies; Increase responsiveness to daily service requests; Provide quality, professional facilities management, and overall value; Access control and egress; Asset management (mechanical services, etc.); Building management control systems; Building Code and Regulatory Compliance; Building repairs and maintenance; Cleaning and general maintenance; Conserving asset value; Contract and contractor management; Energy and water management (lighting use, etc.); Enhancing comfort and amenity for facility users;Gardening and grounds

• Maintenance; Improving building performance; Maintaining security for property occupants and assets; Maintenance planning (equipment, etc.); Record keeping (legal requirements, monitoring, etc.); Reducing operational impacts and life cycle costs; Responding to complaints and suggestions; Risk management, Space management (i.e. effective utilization of space); Sustainability projects and implementation; Tracking and recording energy & water consumption; Undertaking larger capital or maintenance projects; Stakeholder engagement; Waste management.

• Energy and water efficiency; Waste avoidance and minimization; Ecological conservation; Conservation of building materials; Enhancement of indoor air quality; Appropriate landscaping; Enhancement of community life.

• The facility manger will be expected to provide a single point of contact/accountability and coordinate the activities of various service providers in provision of services relating to electrical works, water and sanitation works, safety works, generator maintenance, elevator maintenance, waste management and cleaning (janitorial) services, civil works, carpentry works, and Firefighting services.


SectionANNEXES AND DIAGRAMS13

Annex 1 - Agency Requirements

List of Agencies participating in the project Letter of Interest, signed by all participating Agencies

Annex 2 - Financial Component

The Standard WGCP Cost-Benefit Analysis (CBA) for the preferred Lubowa option

Annex 3 - Security

A DSS report of the preferred site(s), include DSS recommendations to bring the building up to MOSS,

along with a Security & Risk Assessment of your country and duty station

Annex 4 – MOA between Government and UN system

Annex 5 - Other items, which may be submitted at a later stage

Agency leases

Complete and signed MOU, including all Annexes

Complete MOA, including all Annexes

Annex 6 - Diagrams and images

NSSF Lubowa Housing development Master Plan UN Option

Proposed UN House Site Topographical Survey

Google Image Lubowa UN site

Photograph Lubowa UN Site

Suggested Images of Proposed Green Common Premises

Annex 7 – Real Estate data

Knight Frank Q3, Q4 2014 Market Report, 2015 Outlook

Offices Rates Comparison - April 2015

Market Study , Kenya, Uganda, Tanzania, Burundi and Rwanda


Annex 1 - Agency Requirements

LIST OF PARTICIPATING AGENCIES:

1. UNDP/ RCO2. WHO3. WFP4. UNHCR5. IOM6. UNWOMEN7. UNAIDS8. UNFPA9. OHCHR10. UNICEF

OTHER SMALLER AGENCIES THAT ARE PARTICIPATING:

11. UNESCO12. MUNESCO13. UNDSS14. IFAD15. UNCLINIC16. PULSE LAB


LETTER OF INTEREST SIGNED BY ALL PARTICIPATING AGENCIES


Annex 2 - Financial Component

TABLE IX.1: REPAYMENT AND EXPENSES AT PROPOSED UN COMMON PREMISES BY PARTICIPATING UN AGENCIES (FOR THE OVERAL BUILT UP SPACE OF 32,760. INCLUDING CARPARK AND EXTERNAL BUILT UP AREAS )


No. 115 65 170 100 120 22 70 80 35 22 799% 14.39% 8.14% 21.28% 12.52% 15.02% 2.75% 8.76% 10.01% 4.38% 2.75% 100.00%m2 1,846.00 1,040.00 2,720.00 1,600.00 1,920.00 352.00 1,120.00 1,250.00 560.00 352.00 32,760.00% 5.63% 3.17% 8.30% 4.88% 5.86% 1.07% 3.42% 3.82% 1.71% 1.07% 38.95%


$ 106,612.70 $ 60,063.49 $ 157,089.13 $ 92,405.37 $ 110,886.45 $ 20,329.18 $ 64,683.76 $ 72,191.70 $ 32,341.88 $ 20,329.18 $ 1,892,000.00 $ 5,634.92 $ 3,174.60 $ 8,302.81 $ 4,884.00 $ 5,860.81 $ 1,074.48 $ 3,418.80 $ 3,815.63 $ 1,709.40 $ 1,074.48 $ 100,000.00 $ 563.72 $ 317.59 $ 830.61 $ 488.60 $ 586.32 $ 107.49 $ 342.02 $ 381.72 $ 171.01 $ 107.49 $ 10,004.00 $ 487.98 $ 274.92 $ 719.02 $ 422.95 $ 507.55 $ 93.05 $ 296.07 $ 330.43 $ 148.03 $ 93.05 $ 8,660.00 $ 5,751.62 $ 3,240.35 $ 8,474.76 $ 4,985.15 $ 5,982.18 $ 1,096.73 $ 3,489.61 $ 3,894.65 $ 1,744.80 $ 1,096.73 $ 102,071.00 $ 16,904.76 $ 9,523.81 $ 24,908.42 $ 14,652.01 $ 17,582.42 $ 3,223.44 $ 10,256.41 $ 11,446.89 $ 5,128.21 $ 3,223.44 $ 300,000.00

$ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 4,507.94 $ 2,539.68 $ 6,642.25 $ 3,907.20 $ 4,688.64 $ 859.58 $ 2,735.04 $ 3,052.50 $ 1,367.52 $ 859.58 $ 80,000.00 $ 14,087.30 $ 7,936.51 $ 20,757.02 $ 12,210.01 $ 14,652.01 $ 2,686.20 $ 8,547.01 $ 9,539.07 $ 4,273.50 $ 2,686.20 $ 250,000.00

$ 154,550.94 $ 87,070.95 $227,724.03 $133,955.31 $ 160,746.37 $ 29,470.17 $ 93,768.72 $ 104,652.59 $ 46,884.36 $ 29,470.17 $ 2,742,735.00


Employees

Area

Services


Totals


TABLE X.2: FIVE YEAR COST BENEFIT ANALYSIS TABLE COMPARING RENTAL PAYMENTS VERSUS LUBOWA CONSTRUCTION REPAYMENTS (FOR THE OVERALL BUILT UP SPACE INCLUDING CAR PARK)

Prepared on: 19/ 4/ 2015 By:3.25% 5.00

i (1+i)n 0.0381(1+i)n -1 0.1734





$4,129,462.00 2,742,735.00$ -$ -$ $20,647,310.00 13,713,675.00$ -$ -$

14,578.00 32,760.00 14,578.00 14,578.00

$283.27 83.72$ -$ N/ A -$ -$ -$

$283.27 83.72$ -$ -$ $1,416.33 418.61$ -$ -$ TOTAL COSTS / m2

Gbade Smith

OPTION COMPARISON

TOTAL ANNUAL COSTS


Total Space (m2)



TOTAL COSTS



Option Cost ComparisonFEASIBILITY STUDY

0.2199


TABLE XI.2: TEN YEAR COST BENEFIT ANALYSIS TABLE COMPARING RENTAL PAYMENTS VERSUS LUBOWA CONSTRUCTION REPAYMENTS (FOR THE OVERALL BUILT UP SPACE INCLUDING CAR PARK)

Prepared on: 19/ 4/ 2015 By:3.25% 10.00

i (1+i)n 0.0447(1+i)n -1 0.3769





$4,129,462.00 2,742,735.00$ -$ -$ $41,294,620.00 27,427,350.00$ -$ -$

14,578.00 32,760.00 14,578.00 14,578.00

$283.27 83.72$ -$ N/ A -$ -$ -$

$283.27 83.72$ -$ -$ $2,832.67 837.22$ -$ -$ TOTAL COSTS / m2

Gbade Smith

OPTION COMPARISON

TOTAL ANNUAL COSTS


Total Space (m2)



TOTAL COSTS




0.1187



TABLE XII.1: TWENTY YEAR COST BENEFIT ANALYSIS TABLE COMPARING RENTAL PAYMENTS VERSUS LUBOWA CONSTRUCTION REPAYMENTS (FOR THE OVERALL BUILT UP SPACE INCLUDING CAR PARK)

Prepared on: 19/ 4/ 2015 By:3.25% 20.00

i (1+i)n 0.0616(1+i)n -1 0.8958





$4,129,462.00 2,742,735.00$ -$ -$ $82,589,240.00 54,854,700.00$ -$ -$

14,578.00 32,760.00 14,578.00 14,578.00

$283.27 83.72$ -$ N/ A -$ -$ -$

$283.27 83.72$ -$ -$ $5,665.33 1,674.44$ -$ -$


TOTAL COSTS / m2

Gbade Smith

OPTION COMPARISON

TOTAL ANNUAL COSTS


Total Space (m2)



TOTAL COSTS




0.0688


TABLE XIII :The Standard WGCP Cost-Benefit Analysis (CBA) for the current situation

FEASI BILI TY STUDY

Prepared on: By:

UNDP/ RCO UNFPA UNI CEF WFP UNHCR UNAIDS WHO I OM UNWOMEN OHCHR Totals

No. 115 65 160 95 101 15 54 74 25 17 721% 15.95% 9.02% 22.19% 13.18% 14.01% 2.08% 7.49% 10.26% 3.47% 2.36% 100.00%m2 2,316.00 1,500.00 3,142.00 1,901.00 1,908.00 337.00 763.00 1,575.00 643.00 493.00 14,578.00% + 10.29% 21.55% 13.04% 13.09% 2.31% 5.23% 10.80% 4.41% 3.38% 84.11%

UNDP/ RCO UNFPA UNI CEF WFP UNHCR UNAIDS WHO I OM UNWOMEN OHCHR Sub-Totals

$ 384,000.00 $ 221,400.00 $ 377,040.00 $ 589,387.00 $ 285,600.00 $ 108,821.00 $ 280,164.00 $ 84,000.00 $ 91,952.00 $ 141,600.00 $ 2,563,964.00 $ 25,992.00 $ 15,000.00 $ 41,248.00 $ 36,000.00 $ 40,913.00 $ 2,268.00 $ 14,097.00 $ 6,329.00 $ 5,000.00 $ 11,524.00 $ 198,371.00 $ 1,030.00 $ 873.00 $ 2,223.00 $ 1,550.00 $ 821.00 $ 147.00 $ 622.00 $ 500.00 $ 450.00 $ 400.00 $ 8,616.00 $ 377.00 $ 320.00 $ 813.00 $ 567.00 $ 300.00 $ 54.00 $ 228.00 $ 100.00 $ 200.00 $ 200.00 $ 3,159.00 $ 102,000.00 $ 21,622.00 $ 36,000.00 $ 15,819.00 $ 60,000.00 $ 21,503.00 $ 30,000.00 $ 18,810.00 $ 58,038.00 $ 36,042.00 $ 399,834.00 $ 19,968.00 $ 38,193.00 $ 125,000.00 $ 74,040.00 $ 35,911.00 $ 6,419.00 $ 27,210.00 $ 21,678.00 $ 13,005.00 $ 5,492.00 $ 366,916.00

$ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 8,629.00 $ 3,797.00 $ 96,665.00 $ 144,400.00 $ 7,033.00 $ 638.00 $ 10,238.00 $ 1,860.00 $ 5,000.00 $ 1,056.00 $ 279,316.00 $ 59,800.00 $ 35,000.00 $ 55,880.00 $ 38,968.00 $ 41,000.00 $ 15,765.00 $ 15,641.00 $ 12,000.00 $ 14,016.00 $ 21,216.00 $ 309,286.00

$ 601,796.00 $ 336,205.00 $ 734,869.00 $ 900,731.00 $ 471,578.00 $ 155,615.00 $ 378,200.00 ######### $ 187,661.00 $ 217,530.00 $ 4,129,462.00

Current Cost / m2 283.27$

Power Supply

19/ 4/ 2015

U.N. House / Common Premises Lubowa Kamapala, Uganda

Lease

Gbade SmithCurrent SituationAnnual Recurring Cost Pro-Ration Sheet

Services


Totals

Employees

Area

CleaningGarbage collection & recycling

Security (premises only)Water Supply

Gardening

Gas Supply

Maintenance

TABLE XIV: The Standard WGCP Cost-Benefit Analysis (CBA) for annual recurring cost Proposed

Common Premises U.N. House / Common Premises

FEASIBILITY STUDY

Prepared on: By:


No. 115 65 170 100 120 22 70 80 35 22 799% 14.39% 8.14% 21.28% 12.52% 15.02% 2.75% 8.76% 10.01% 4.38% 2.75% 100.00%m2 1,846.00 1,040.00 2,720.00 1,600.00 1,920.00 352.00 1,120.00 1,250.00 560.00 352.00 12,760.00% 14.47% 8.15% 21.32% 12.54% 15.05% 2.76% 8.78% 9.80% 4.39% 2.76% 100.00%


$ 273,717.24 $ 154,206.90 $ 403,310.34 $ 237,241.38 $ 284,689.66 $ 52,193.10 $ 166,068.97 $ 185,344.83 $ 83,034.48 $ 52,193.10 $ 1,892,000.00 $ 14,467.08 $ 8,150.47 $ 21,316.61 $ 12,539.18 $ 15,047.02 $ 2,758.62 $ 8,777.43 $ 9,796.24 $ 4,388.71 $ 2,758.62 $ 100,000.00 $ 1,447.29 $ 815.37 $ 2,132.51 $ 1,254.42 $ 1,505.30 $ 275.97 $ 878.09 $ 980.02 $ 439.05 $ 275.97 $ 10,004.00 $ 1,252.85 $ 705.83 $ 1,846.02 $ 1,085.89 $ 1,303.07 $ 238.90 $ 760.13 $ 848.35 $ 380.06 $ 238.90 $ 8,660.00 $ 14,766.70 $ 8,319.27 $ 21,758.08 $ 12,798.87 $ 15,358.65 $ 2,815.75 $ 8,959.21 $ 9,999.12 $ 4,479.61 $ 2,815.75 $ 102,071.00 $ 43,401.25 $ 24,451.41 $ 63,949.84 $ 37,617.55 $ 45,141.07 $ 8,275.86 $ 26,332.29 $ 29,388.71 $ 13,166.14 $ 8,275.86 $ 300,000.00

$ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ - $ 11,573.67 $ 6,520.38 $ 17,053.29 $ 10,031.35 $ 12,037.62 $ 2,206.90 $ 7,021.94 $ 7,836.99 $ 3,510.97 $ 2,206.90 $ 80,000.00 $ 36,167.71 $ 20,376.18 $ 53,291.54 $ 31,347.96 $ 37,617.55 $ 6,896.55 $ 21,943.57 $ 24,490.60 $ 10,971.79 $ 6,896.55 $ 250,000.00

$ 396,793.79 $ 223,545.80 $584,658.24 $343,916.61 $ 412,699.94 $ 75,661.66 $ 240,741.63 $ 268,684.86 $ 120,370.82 $ 75,661.66 $ 2,742,735.00


Employees

Area

Services


Gbade Smith


Annual Recurring Costs Pro-Ration Sheet Option I Lubowa New Construction19/ 4/ 2015

Totals



TABLE XV:The Standard WGCP Cost-Benefit Analysis (CBA) for Investment cost Proposed Common

PremisesU.N. House / Common Premises

FEASI BI LI TY STUDY

Prepared on: By:

UNDP/ RCO UNFPA UNI CEF WFP UNHCR UNAIDS WHO IOM UNWOMEN OHCHR Totals

No. 115 65 170 100 120 22 70 80 35 22 799% 14.39% 8.14% 21.28% 12.52% 15.02% 2.75% 8.76% 10.01% 4.38% 2.75% 100.00%m2 1,846.00 1,040.00 2,720.00 1,600.00 1,920.00 352.00 1,120.00 1,250.00 560.00 352.00 12,760.00% 14.47% 8.15% 21.32% 12.54% 15.05% 2.76% 8.78% 9.80% 4.39% 2.76% 100.00%

UNDP/ RCO UNFPA UNI CEF WFP UNHCR UNAIDS WHO IOM UNWOMEN OHCHR Sub-Totals

$ 976,528.21 $ 550,156.74 $ 1,438,871.47 $ 846,394.98 $ 1,015,673.98 $ 186,206.90 $ 592,476.49 $ 661,246.08 $ 296,238.24 $ 186,206.90 $ 6,750,000.00 $ 1,251,692.16 $ 705,178.68 $ 1,844,313.48 $ 1,084,890.28 $ 1,301,868.34 $ 238,675.86 $ 759,423.20 $ 847,570.53 $ 379,711.60 $ 238,675.86 $ 8,652,000.00 $ 455,713.17 $ 256,739.81 $ 671,473.35 $ 394,984.33 $ 473,981.19 $ 86,896.55 $ 276,489.03 $ 308,581.50 $ 138,244.51 $ 86,896.55 $ 3,150,000.00 $ 485,521.15 $ 273,533.04 $ 715,394.11 $ 420,820.06 $ 504,984.08 $ 92,580.41 $ 294,574.04 $ 328,765.67 $ 147,287.02 $ 92,580.41 $ 3,356,040.00 $ 297,049.76 $ 167,351.97 $ 437,689.78 $ 257,464.58 $ 308,957.49 $ 56,642.21 $ 180,225.20 $ 201,144.20 $ 90,112.60 $ 56,642.21 $ 2,053,280.00 $ 72,335.42 $ 40,752.35 $ 106,583.07 $ 62,695.92 $ 75,235.11 $ 13,793.10 $ 43,887.15 $ 48,981.19 $ 21,943.57 $ 13,793.10 $ 500,000.00 $ 437,629.31 $ 246,551.72 $ 644,827.59 $ 379,310.34 $ 455,172.41 $ 83,448.28 $ 265,517.24 $ 296,336.21 $ 132,758.62 $ 83,448.28 $ 3,025,000.00 $ 361,677.12 $ 203,761.76 $ 532,915.36 $ 313,479.62 $ 376,175.55 $ 68,965.52 $ 219,435.74 $ 244,905.96 $ 109,717.87 $ 68,965.52 $ 2,500,000.00 $ 18,841.79 $ 10,615.09 $ 27,762.55 $ 16,330.91 $ 19,597.09 $ 3,592.80 $ 11,431.64 $ 12,758.52 $ 5,715.82 $ 3,592.80 $ 130,239.00

$ 4,356,988.08 $2,454,641.17 $6,419,830.76 $ 3,776,371.03 $4,531,645.24 $ 830,801.63 $ 2,643,459.72 $2,950,289.87 $ 1,321,729.86 $ 830,801.63 $ 30,116,559.00

Capital Cost / m2 2,360.23$

Investment Costs Pro-Ration Sheet19/ 4/ 2015

S/A - Structural and Architectural workM/P - Mechanical and Plumbing WorkE - Electrical WorkFP - Fire Protection Work

Employees

Area

INVESTMENT I TEMS

C - C ivil (site) Work

Totals

SEC - Security Systems WorkID - I nterior Design Work

SS - Special Systems Work

Engineering Support


Gbade Smith


Option I Lubowa New Construction

TABLE XVI: The Total Built up area 32,760 square meters Investment cost at Proposed Common

PremisesU.N. House / Common Premises

FEASI BI LI TY STUDY

Prepared on: By:

UNDP/ RCO UNFPA UNI CEF WFP UNHCR UNAIDS WHO IOM UNWOMEN OHCHR Totals

No. 115 65 170 100 120 22 70 80 35 22 799% 14.39% 8.14% 21.28% 12.52% 15.02% 2.75% 8.76% 10.01% 4.38% 2.75% 100.00%m2 1,846.00 1,040.00 2,720.00 1,600.00 1,920.00 352.00 1,120.00 1,250.00 560.00 352.00 32,760.00% 5.63% 3.17% 8.30% 4.88% 5.86% 1.07% 3.42% 3.82% 1.71% 1.07% 38.95%

UNDP/ RCO UNFPA UNI CEF WFP UNHCR UNAIDS WHO IOM UNWOMEN OHCHR Sub-Totals

$ 380,357.14 $ 214,285.71 $ 560,439.56 $ 329,670.33 $ 395,604.40 $ 72,527.47 $ 230,769.23 $ 257,554.95 $ 115,384.62 $ 72,527.47 $ 6,750,000.00 $ 487,533.33 $ 274,666.67 $ 718,358.97 $ 422,564.10 $ 507,076.92 $ 92,964.10 $ 295,794.87 $ 330,128.21 $ 147,897.44 $ 92,964.10 $ 8,652,000.00 $ 177,500.00 $ 100,000.00 $ 261,538.46 $ 153,846.15 $ 184,615.38 $ 33,846.15 $ 107,692.31 $ 120,192.31 $ 53,846.15 $ 33,846.15 $ 3,150,000.00 $ 189,110.19 $ 106,540.95 $ 278,645.57 $ 163,909.16 $ 196,690.99 $ 36,060.01 $ 114,736.41 $ 128,054.03 $ 57,368.21 $ 36,060.01 $ 3,356,040.00 $ 115,700.70 $ 65,183.49 $ 170,479.90 $ 100,282.30 $ 120,338.75 $ 22,062.11 $ 70,197.61 $ 78,345.54 $ 35,098.80 $ 22,062.11 $ 2,053,280.00 $ 28,174.60 $ 15,873.02 $ 41,514.04 $ 24,420.02 $ 29,304.03 $ 5,372.41 $ 17,094.02 $ 19,078.14 $ 8,547.01 $ 5,372.41 $ 500,000.00 $ 170,456.35 $ 96,031.75 $ 251,159.95 $ 147,741.15 $ 177,289.38 $ 32,503.05 $ 103,418.80 $ 115,422.77 $ 51,709.40 $ 32,503.05 $ 3,025,000.00 $ 140,873.02 $ 79,365.08 $ 207,570.21 $ 122,100.12 $ 146,520.15 $ 26,862.03 $ 85,470.09 $ 95,390.72 $ 42,735.04 $ 26,862.03 $ 2,500,000.00 $ 345,434.10 $ 194,610.76 $ 508,981.99 $ 299,401.17 $ 359,281.41 $ 65,868.26 $ 209,580.82 $ 233,907.17 $ 104,790.41 $ 65,868.26 $ 6,130,239.00

$ 2,035,139.44 $1,146,557.43 $2,998,688.66 $ 1,763,934.51 $2,116,721.41 $ 388,065.59 $ 1,234,754.15 $1,378,073.83 $ 617,377.08 $ 388,065.59 $ 14,067,377.68

Capital Cost / m2 429.41$

Development cost 36,716,559.00

Investment Costs Pro-Ration Sheet19/ 4/ 2015

S/A - Structural and Architectural workM/P - Mechanical and Plumbing WorkE - Electrical WorkFP - Fire Protection Work

Employees

Area

INVESTMENT I TEMS

C - C ivil (site) Work

Totals

SEC - Security Systems WorkID - I nterior Design Work

SS - Special Systems Work

Engineering Support


Gbade Smith


Option I Lubowa New Construction


Prepared on: 19/ 4/ 2015 By:

CATEGORI ESMaximum Available Score per Category(Total shall be 100)




LOCATION To consider:

Proximity to other business locations, Accessibility (public/private transportation), and others

20 10 20 10 10SPACE

To consider:No. of available workstations, private and public parking, hygienic conditions, faclity management, layout, meeting rooms and

others

20 5 20 5 15SAFETY & SECURITY

To consider:Area, Building, and others 20 5 20 10 5

INVESTMENT COSTS

To considerCapital Costs: 20 10 15 10 10

RECURRING COSTS

To considerOperating Costs: 20 10 20 10 10

TOTAL SCORES 100 40 95 45 50

Gbade Smith

U.N. House / Common Premises Lubowa Kamapala, UgandaFEASI BILITY STUDY

Decision Making Matrix

National Social Security Fund Offer for Financing the Proposed Common Premises - The UN pays the principal cost of construction and professional fees through an annual operational levy and GOU pays all the costs of deal with a view to full ownership- Build Own And Transfer (Revised Construction cost of $36 Million)

In this option, NSSF provides the land through the Uganda Government, finances the construction cost and

professional fees for the UN House. In turn the UN pays the principal cost of construction and professional

fees through an annual fixed operational levy throughout an agreed period guaranteed by Government of

Uganda (GOU). The Government then pays the difference through a tax credit which is in the form of a zero

VAT on NSSF’s construction projects.

The amounts to be paid by the UN after end of construction period are:

35 years 30 years 25 years 20 years 15 years 10 years

Per year $1,048,571 $1,223,333 $1,468,000 $1,835,000 $2,446,667 $3,670,000

Per month $ 87,380 $ 101,944 $ 122,333 $ 152,916 $ 203,888 $ 305,833

Per sqm $ 2.91 $ 3.39 $ 4.07 $ 5.09 $ 6.79 $ 10.9

.

The Government of Uganda: For its part, the Government of Uganda grants the entire Lubowa Housing

Project a zero rated status. This status will only be granted to the NSSF and no other private developer.

This would improve the pricing for other houses, make them competitive from a marketing perspective and

improve the entire area thereby also going along way towards providing Ugandans with decent housing at

good prices. This is a win-win situation for all.UGANDA UN COMMON PREMISES BUSINESS CASE PAGE 45 OF 65

Annex 3 - Security

UN LUBOWA PROJECT SITE SECURITY RISK ASSESMENT (SRA)

Background

Over 12 years ago the Uganda government allocated through National Social Security Fund (NSSF) 30 acres of land at Lubowa to the UN for construction of UN Common Premises. The 30 acres of land is part of the 563 acres on which “NSSF Lubowa mixed high end Green housing development” is to be located as well as a diplomatic zone. Additionally the Government identified NSSF as financiers to fund construction. The availability of funding encouraged UNCT embraced the challenge to develop a Green UN Common Premises in Lubowa.

The UN Common premises (UN house) in Lubowa which is evolving from initial conception will gradually progress through requirements definition, design and development to final implementation in accordance with a project plan or system development life cycle. As a general rule, separate (Security Risk Assessment) SRA reports should be prepared at each step of the way to support informed decision-making and design choices. As the project matures, however, and more details are settled, the subsequent SRA’s will increase in depth, if not in breadth. The overall object for all the successive SRA’s is to create a level of protection that mitigates vulnerabilities to threats and the potential consequences, thereby reducing risk to an acceptable level.

Methodology

The SRA’s will follow successive stages of the project plan or system development life cycle and more details will be captured regarding assets, their values, related threats and associated vulnerabilities while the residual risk may be assessed with greater precision and certainty at each step of the way.

1. Conception stage/planning –Project idea and land acquisition.2. Requirements Definition Stage – determination of operational or business needs and related security

functional requirements (Multidisciplinary in nature involves assessing existing conditions on-site, including security vulnerabilities, context, and design opportunities).

3. Architecture Design Stage – identification of secure system options and selection of the preferred architecture;

4. Detailed Design Stage – development of design specifications and specific safeguards to satisfy the system security policy and functional requirements;

5. Implementation Stage – completion of acquisition, installation and testing;6. Operational Stage – commencement of operations with ongoing maintenance and review to maintain

security posture.


Aim The aim is to assess the risks associated with the new site for the UN project

Scope The assessment is limited to aspects of site location, neighborhood, accessibility and available facilities.

Limitations Absence of specialized documentation of the soil structure and environmental aspects Lack documentation and statistics of incidents in the area. Absence of up to date maps and baseline data.

Input documentation1. UN Uganda country SRA

TABLE V: FINDINGSSTATUS/OBSERVATIONS REMARKS/

RECOMMENDATIONSProximity/location 32 Kms to Entebbe

12 Kms to Kampala 1.6 Kms off Kampala- ebb

highway to the east (paved)Site Availability Clear title, recent survey, available

Boundaries demarcating the 30 acre UN project not opened

Open up the boundaries and mark them with a buffer road all round

Size of Site Building Footprint Available on site LayoutService Area ( dumpsters/recycling bins, loading and turning area for trucks)

Available on site layout

Bus Drop-off/Pick-up (including space for angled parking and driveways with appropriate turning radius)

Available on site layout

Vehicle Parking Available on site layoutHelipad Available on site layout All round stand-off road Available on site layout Recreation area Available on site LayoutGrassy/ green area Available on site Layout Screening area Available on Site layout etc.

Traffic and access Road network is expected to greatly improve with the completion of ongoing road projects. Including access road to Munyunyo, Makindye and Kajjansi.

1.6 kms paved road -Driveway access from Kampala- Entebbe Highway.

Entebbe – Kampala highway has heavy traffic hold ups during peak hours.

Driveway access from Local Roads Currently under construction

Marram access roads with low traffic

They are narrow, dusty with a lot of colligation.

They include; Lubowa- Lubugumu to batabata

stage on Entebbe road Lubowa- Lweza to Kajjansi Lubowa- Lweza –Kigo- Salama

road- Makindye

Roadway Capacity, Safety Needs Increased vehicle trips to the site

may create congestion and delay for staff related traffic

The roads requires upgrading by Uganda road authority URA with

Requires a Traffic Impact Analysis

Adequate intersection sight distance can be provided but requires clearing and/or earthwork.

The roadway will require widening to provide turning lanes to accommodate increased traffic volumes


improvement work at major intersection.

Neighborhood Upscale quality housing to the south and west

Middle income housing to the east Valley planned for green belt to

North Vacant 563 acres, of which

NSSF/Government has offered 30 acres to UN project

Future Expansion NSSF has a master plan to

develop the entire 563 acres of land with facilities to benefit UN including Fire Station, Police Post, Schools, Shopping complex , Hospital etc.(See NSSF Lubowa master plan – Annex 5)

National housing and private developers constructing several residential houses in the neighbourhood.

Road network expected to greatly improve with the coming projects.

Natural Hazards Site free of any potential damage/injury from natural hazards

Site has no known/potential hazmat issues

Public transport/Airports Availability of public transport along Kampala – Entebbe road.

Entebbe international airport is 32 Kms from the site.

Kajjansi airstrip is 6kms away.

Ease of Transporting Construction Materials

Sites close to the transportation routes.

Transporting of equipment/ materials will be simple; on established routes.

Proximity to Housing facilities/recreation

There a number of quality housing in the neighbourhood and more are under construction.

Lake Victoria Serena resort is 7kms away in addition to others hotels in Entebbe and Kampala City which offer recreation facilities.

water sources/sewerage The NSSF development and the Existing National housing project have established that piped water system is available adjacent to or near the site

The NSSF development and the Existing National housing project have established the existence of a reliable waste/sewer system with adequate capacity

Sufficient capacity exist to be supplemented by bore hole and water treatment to back up the capacity and reliability piped water system

Electrical Power Sites closest to the existing overhead power grid serving the neighbourhood

No existing alternative energy systems in the area.

Need to establish the Capacity and reliability of existing power system.

Explore the required power backup

Fuel Storage/Distribution There are several petrol stations on Kampala/Entebbe road within 5-10 minutes’ drive from the site. A fuel system/storage will be available at the site

Petrol station and fuel storage facility have been included in the master plan

Topography Site is mostly level and can accommodate all anticipated uses

Typically year-round well drained ground/road access

Site has positive drainage; no water contribution from surrounding areas


Stable soils; conventional foundation system possible

Site is not in flood plain; no nearby bodies of water

Site has no wetlands No erosion potential; not near

water or at toes of slopes.

Access to Learning institutions In the neighborhood there are two international schools American International and Galaxy international, shopping centers and many local schools

The NSSF development will have schools for ages 5-11 with crèche and play schools. There are also existing public primary schools in the vicinity as well as private schools

Medical facilities There are two modern medical facilities equivalent to Kampala hospital within 5-10 kms from the site and several smaller clinics on the Kampala /Entebbe road

An ultra-modern clinic with diagnostic capacity will be built on the Common premises for UN Clinic to manage

Currently the main referral centres are in Kampala and Entebbe.

Work force Staff members reside in and around the greater Kampala, Entebbe, and Lubowa area with the majority living in suburbs outside Kampala.

The current housing in the area is adequate for international staff.

Currently UN staff live in Entebbe and while Heavy traffic poses a challenge for National staff to and from the work place. The early departure allow timely arrival at work.

Relocation of office will be compliment by existing and new commuter buses for staff form Kampala and Entebbe.

Proximity to Fire Response Equipment

The NSSF development will have a fire station 5 kms from the UN premises.

However there are two fire station with 15 -20 minutes away Kampala fire station is 12 kms away while the alternate is Entebbe at 20 kms

The Common premises will have its own fire station on the site to ensure rapid response in case of emergency

Possible evacuation route/ reception points

Lubowa- via Kigo road through Makindye to Kampala

Lubowa to Lake Victoria Serena resort Via the lake by boat to Entebbe air port

Lubowa to Kajjansi air strip Entebbe Kampala highway.

The proximity to the diplomatic zone in the NSSF development and to the Airport is a definite advantage for the UN common Premises at the Lubowa Location

Zoning/Land Use The inclusion of a diplomatic zone in the current NSSF development will greatly enhance security zoning and reduce the possibility of irregular structures being built in the area around the 563 acres zoned for high end residential development this is compatible with the UN Common Premises requirements .

The 30 acres allows buffer roads to be constructed which are required all round the UN project

- With specific reference to the UN project,- zoning may entail;--

Zone 1: Neighbourhood Zone 2:Standoff perimeter Zone 3: site access and parking Zone 4: site Zone 5: Building Envelope Zone 6:management and building

operations(See Zoning guide Annex A)

TABLE VI: GENERAL THREAT CATEGORY / ENVIRONMENT


Threat Category Threats Assessment Summary / Comment

Intent Capability Inhibiting ContextArmed Conflict

Armed Conflict in the environment

The intention to use armed/military force in Uganda for social or political gains by existing hostile force including LRA and ADF is presently remote.

No or very limited presence of hostile military-type capability. There is very limited or no military-type weapons, training, etc. within Uganda). Renewed capability of ADF (Ugandan Rebels) in DRC.

The overall visible massive Government security forces deployment is a strong deterrent against initiating any conflict. Most reactionary groups are either defunct or have been driven out of Uganda.

Terrorism • General explosive and/or asymmetrical attacks by suspected Al Shabaab militants and ADF on UN facilities.

• Use terrorism against the UN and the state in the form of VBIED, PBIED, other IEDs, rockets, armed attacks or a combination of any of the above on UN facilities, and assets

• The intention of a terrorist attack on the UN by AS/AQ is acknowledged worldwide

• Al Shabaab has demonstrated the capacity to conduct a wider-range and varied terror attacks in neighbouring Kenya and Somalia apart from that which occurred in Uganda. • Indigenous groups and sympathizers are always available to support and execute the cause of AS and other terrorist group agenda in spite of what effect it will have on the country.

Gov’t security forces need adequate training/equipment to fight terrorism and face major challenges to prevent terrorist activities before they occur.

The international community is a major source of intelligence in inhibiting the terror actors.

Gov’t has put in place several mechanisms to combat terrorism

MOSSCrime The UN

Common Premises will be located in a highly secure Diplomatic zone With private patrols similar to US & UK embassy

Robbery/banditry

• Theft of valuables • Vehicle break-ins• Sex crimes• Petty crimes

Murders

• Crimes are opportunistic in nature and mostly for economic benefit • Violent armed crime tends to focus on high value targets

• Unemployment and rising cost of living have the potential to raise crime levels dramatically.

• Criminals are generally lone rangers who are seldom armed.

• Increasing armed gang operations are becoming widespread in Kampala and other urban centres.

. Organised gangs

• The overall socio-economic environment is favourable for criminal elements to operate.

• There is relatively minimal control on crime

. Active private and police presence at UN offices will ensure high levels of security

• The decision to supplement government security with private security is informed the fact that Police and Criminal Justice system are both stretched and lacks adequate resources to effectively combat crime.

. MOSS

SOP and Aide memoire

QRF in Kampala,

Civil Unrest

Civil/Peaceful demonstrations

Riot and mob action Looting of property

Violent Protests

Possible intentions include peaceful protests against Govt socio-economic and political policies which often become rowdy and disruptive. Although UN is usually not a deliberate target, the fallouts may disrupt UN official/staff movement and operational activities.

Small crowds usually initiate the unrest but end up in large numbers and in riotous situation. Riots and mob actions resulting in property looting usually follows a civil unrest.

High levels of unemployment and discontent amongst the urban youth.

• Crowd control mechanisms in terms of security personnel and equipment has generally improved• The Govt’s priority in securing the most vulnerable places.

General RTA Hazard events such as These events have Better state


Threat Category Threats Assessment Summary / Comment

Intent Capability Inhibiting ContextHazards Pandemic

/Diseases Fires Floods

serious RTA occur often in Kampala Diseases/Pandemics are common and fires and floods are seasonal in Kampala,

moderate to severe impact on UN operations

Limited emergency response capabilities

sponsored warning and/or preparedness systems in place.

MOSS

Medevac Plan

TABLE VII: SUMMARY OF MOST SIGNIFICANT RISKS TO UN OPERATIONS (See SRA Matrix- UN Lubowa Project Annex B)

# Risk Current Risk Level

Residual Risk Level(After Implementation of SRM Measures)

1 Explosive attacks - General in Kampala & Entebbe High Medium2 IED (Road side bomb) Medium Low3 IED(Planted) PBIED(Suicide bomber)/VBIED (planted/loaded)/Small

arms attackHigh Medium

4 Widespread civil unrest Medium Low5 Residential robbery/Vehicle break-in/Theft of valuables/ Mugging/ Sex

crime & violenceMedium Low

6 Riots/Mob action/Looting Medium Low7 Serious Road Traffic Accidents Medium Low8 Fires Medium Low9 Pandemic/Diseases Medium Low10 Tremors (Collapse of buildings) Medium Low11 Lightning strikes Medium Low

Annex 4 - MOA between Government and UN system


Annex 4 – Topographic Site layout, Satelite Images, Site Photographs

NSSF Lubowa Housing development Master Plan UN Option

Topographical survey of UN 30 acre site

Site photographs Google maps

PHYSICAL INFRASTRACTURE

1 Roads The identified main access road linking the project site and Entebbe-Kampala road is Lubowa Estate road. This forms the main spine of access for the neighborhood from which are interlinkages of numerous by access distributor roads to the sub-neighborhoods and individual properties. The internal road network is well planned and interconnected as it follows a fairly well laid out pattern of development. Namasuba-Ndejje road on the north-eastern periphery of the project area is identified as a secondary access. This road has great potential to be a key secondary distributor when it is bituminized at some future date. This is more so as it has been identified as one of the key roads forming the Greater Kampala Transportation network, under the current ‘Preparation of the Kampala Metropolitan Framework (KDPF) and Physical Development Plan (KPDP) [“Updating Kampala ‘s Structure Plan and Upgrading the Kampala GIS Unit’ Project]. The intended NSSF development road network is expected to have a hierarchically structured road net work that will join on to this well planned existing one. The main spine is expected to be the current road interlinking Lubowa Estates road and Namasuba-Ndejje road, which bisects the project site into two geographical sectors. This project site is also linked to Mutungo road that joins Lweza road in the south. This latter road is to be upgraded as a spur road linking to the current Kampala-Entebbe expressway project. This Lweza road will end up in Munyonyo Commonwealth Resort in Kampala. This implies that the project area will easily be linked to Entebbe through Lweza and Expressway and to Kampala through the same road. The programme of Kampala-Entebbe expressway and the Lweza spur road construction is part of the Master Plan for Greater Kampala whereby Rapid Bus transit system is to be promoted. This will facilitate fast movement between Entebbe and Kampala, and simultaneously have links with district distributor roads within the corridor and stimulate more development. The proposed road project will directly benefit the NSSF Lubowa scheme in terms of accessibility.

2 Water and Sewerage

2.1 Water There is a water main that runs from Kampala to Kajjansi a point it connects with the 400mm from Entebbe Town. The urban centers along the Kampala-Entebbe road axis and those areas off this road at an average distance of 7 kilometers on either side including


Lubowa the project site location are connected to this water main through distributor lines that simultaneously vary in diameter. In respect of Lubowa, neighborhood the water is from Seguku boaster which is pumped to the water reservoir on Lubowa hill. This water reservoir has a capacity of 400cubic meters. The water then flows by gravity through two main distributor lines of 150mm diameter from which the various consumers’ supply lines connect. This water supply network would fairly meet some ware needs of the planned project. Due to the scale of fast increasing development in the surrounding neighborhoods, National Water and Sewerage Corporation (NWSC- Eng. Gisagara Ag.Managing Director) has indicated that it is increasing the capacity of the water Reservoir at Namasuba hill to 2x4000cbm beginning of 2014(March). The capacity is to be supplemented to supply Lubowa site and it’s proposed 3000 Housing Development Scheme.. Similarly, 1 to 3 outlets from the reservoir with minimum diameter of 500mm will supply the site. These pipes are to be increased in size to 1000mm diameter

2.2. Sewerage This facility is provided in Kampala and Entebbe but on a scale which is about 10% in each respective case. The area within Kampala-Entebbe urban corridor relies on site-sanitation that includes septic tanks, pit latrines and micro-sewerage treatment plants. Lubowa neighborhood largely uses septic tanks as there is no sewerage system in the area. Lack of the area physical master plan that brings on board major land uses and other physical infrastructure has attributed to the current state of disjointed and in other cases absence of sewerage facilities. Hence most areas within Kampala-Entebbe corridor will still continue largely relying on use of septic tanks and micro-sewerage treatment plants where possible. NSSF which is planning large scale development in Lubowa will need to construct either micro-sewerage treatment plant or use sewerage lagoons. Both environment impact and economic feasibility studies would be able to guide on selection of the suitable option.

3 Electricity There is a three phase line running through Lubowa from the Entebbe –Kampala main power line. From this line connect the distributor lines to individual properties. More power supply will depend on demand for development. Already a 33kv sub-station is under construction in the vicinity of Lubowa since June 2012 Thus power supply is available and reinforcement will be influenced by the scale and nature of development to be executed on the project site. There are plans by Umeme to construct 10 transformers by 2013 with an output of 28MWatts. This will adequately provide the power needs of the planned development.


Proposed UN House Site Topographical Survey


Google Image Lubowa UN site


Photograph of Lubowa UN Site as it is presently


Suggested Images of Proposed Green Common Premises


Annex 5 – Commercial Real Estate data for Uganda

Q4 2014 Economic Statistics: Annual Core Inflation

6.7%

Real GDP 4.7% Growth Annual Headline

1.8%

Real GDP per Capita 1.1%

CBR January 11% 201Average Exchange

Ugx 2,854

91 day T-bills 180 day364 day

10.56%, 12.31% and 12.09%

Office Rents April 2015

Grade A $17.00 - $22.00per sq.m per month excl VAT

Grade AB space

$12.00 - $15.00per sq.m per month excl VAT

Grade B $8.00 - $ 10.00per sq.m per month excl VAT

Prime Office Yields

8% - 10%

External Image of Office

Address/ Location

Size of Building (Sq m)

Lettable Areas (Sq.m)

Minimum Lease Term

Parking

Asking Rent per (Sq.m)

Service Charge per (Sq.m)

Escalation

Rwenzori Towers,

Nakasero

9,855 330-5th Floor 754- 4th

Floor 590- Ground Floor

5 yrs US $50 per slot

per month, Parking Ratio is

1:45

$ 18.00 $ 4.00 5% every 2 years


Rwenzori House

4,7100 6th Flr-614 5 yrs US $50 per slot

per month, Parking Ratio is

1:50

$ 18.00 $5.00 5% every 2 years

Rwenzori Courts,

Nakasero

5,600 Mez-87.31, Grd Flr-155 1st Flr-605.86 2nd Flr-130.0

121- (Aug)

5 yrs US$50 per slot

per month

$18.00 $ 4.1 5% every 2 years

Lugogo House, Lugogo Bypass

10,000

Block A-292.94

Block B-352.66 Block C-

400.0

3 yrs. To be advised

$ 15.00 $3.50 TBA

PERTINENT ASSUMPTIONS FOR REAL ESTATE INVESTMENT IN UGANDA

Construction Costs PER Square Metre

Current Construction CostsUS$/M² GFA - (Excluding VAT and Land Costs

1 Office Grade A US$ 650 - 800 (shell and core) $1,000 fitted.2 Office Grade B US$ 450 - 600 3 Prime Residential US$ 900 - 1,1304 Retails Malls US$ 600 - 7005 Grade A Warehouses US$ 650 - 8006 Affordable Housing US$ 200 - 350

250m/- - 300m/-


uganda un common premises business case june 04 2015

Documents