Contractors looking to develop a government-sponsored social housing project in Bahrain have been granted an extra month to prepare their submissions for the scheme.

Sources close to the project say the bid deadline has been extended to 12 August from 15 July at the request of all three shortlisted firms. The requests came at a series of meetings held in mid-June with the bidders, the Housing Ministry and its advisers .

A source involved in the project says, “More time is needed because this is the first project of its type in the region so a lot of work needs to be done on these bids.” The request for proposals (RFP) also gives the shortlisted firms flexibility about how they structure their bids.

The project involves the construction of 5,000 housing units, featuring a minimum of 3,500 social housing units. Bidders can opt to build more units on the sites if they think it will improve the viability of the project. Three sites have been selected for development, and the land will be given the preferred bidder for free.

The three sites are Al-Buhari east of Riffa area, an area of reclaimed land known as North Bahrain Newtown and Al-Lawzi. Three groups were shortlisted to bid for the project in mid-April, including the local Al-Moayyed International Group and Naseej, a real estate and infrastructure development company.

A preferred bidder is expected to be chosen around six weeks after the bids are submitted. A source close to the Housing Ministry says, “Bidders do not have to provide fully funded bids, but they must have a realistic funding plan and the more financial support they can demonstrate, the more favourable their bid will be viewed.”

Once a developer is selected for the project, the Housing Ministry will look to tender a second social housing scheme. It hopes to capitalise on the initial interest expressed in the project by 15 potential bidders, who attended a conference on the scheme in February.

The government wants to develop around 20,000 homes under a public-private partnership basis (PPP) to address a chronic housing shortage that is one of the country’s most contentious political issues.

The Housing Ministry is being advised by Ernst & Young, the UK’s Mott MacDonald and law firm Freshfields Bruckhaus Deringer