The local government ministry is learning of what it describes as an unfair trend among shop owners at the phase one of the Kumasi Central Market Redevelopment project who are subletting their shops beyond its original premium and market value.
At a government stakeholder meeting in Kumasi, sector minister, Mahama Ayariga says preliminary assessment of premium payments revealed some shop owners renting out their spaces at a price more than four times the agreed premium cost of 25,000 cedis.
“There is evidence to show that some people have distributed the shops among themselves, and have sublet to other people at the actual market rate. They paid the assembly 25,000 cedis but sold to others between 100 to 120 thousand cedis. And I am saying that is unfair,” he said.
He continued that: “If 100,000 cedis is the market rate, then let’s collect at the rate, so the state can use that money to fund the phase 3”.
Other occupants have also failed to pay the full premium cost despite its five-year expiry date of tenancy.
The disturbing trend has since impacted premium payment heavily with a little above half of the expected 5-year premium payment collected.
When government commissioned the phase one of the Kumasi Central Market redevelopment project, a total of 165.3 million cedis were expected to be taken as premium at the end of a 5-year lease.
But the premium payment has been lackadaisical with majority of the occupants failing to honour their financial obligations.
These revenues raised were to be used in funding the second and third phases of the project.
However, Kumasi mayor, Richard Agyeman-Boadi says only 89 million cedis have been collected, which is woefully inadequate to fund the completion of the projects.
“The monies we came to meet and the ones we have collected amount to 89 million cedis. The shops were sold at an affordable price to traders only for us to realize people are cheating the system. I know someone who doesn’t sell at the market but has twenty (20) shops and sold them at 100,000 cedis instead of the 25,000 cedis price we sold to them for the 5-year tenancy,” he said.
The Phase II project is a planned redevelopment of Kumasi Central Market, intended to add substantial modern trading and support facilities to the existing Kejetia complex.
The contract for the 248-million-euro project was originally signed in December 2018 and expected to be completed in 48 months.
Therefore, the assembly together with the local government minister are devising a new means for the collection of the premiums.
“In the phase two, we will be collecting the real value of the stalls. We are using proceeds from phases one and two to construct phase 3. We aren’t going to borrow any cash, we will use the revenues from the market to do the construction,” he added.
The assembly together with local government minister and the traders are expected to hold crunch meetings to deliberate on how much premium the m stalls should be valued at to generate enough income for the facility’s management.
An independent entity is also expected to be outsourced in collection of the market premium for the second and subsequent phases of the market project.
Consultant for the project, Tony Yeboah-Asare of Avangarde Design Services, further emphasized the need for a regular and adequate premium payments to properly manage the facility.
“As consultant, our main issue is the pre-operational activities. Who is coming to manage the facility? The traders should be able to pay enough for the facility managers to be able to get income to manage,” he noted.
The phase 2 project is currently at a 68 percent overall project of work with 84 percent of procurement made and 49 percent of construction works done.
The city mayor further debunked speculations that distribution of stalls at the yet-to-be completed market project has commenced, warning traders not to pay any money to individuals or entities purporting to be taking the market premiums on behalf of the assembly.
Meanwhile, traders in the phase one market have been cautioned to settle all their outstanding premium debt by the end of December or risk losing their shops.
Construction works on the second phase of the Kumasi Central Market Redevelopment project is expected to resume in October 2026.
