Nairobi MCAs halt Jevanjee housing project transactions amid loan inquiry

The Nairobi County Assembly has formally requested the National Bank of Kenya to suspend all transactions related to the title deed for the Jevanjee housing project.

This decision comes as the assembly initiates an investigation into claims that the title deed was used as collateral to secure a Sh1.9 billion loan.

In a letter addressed to the bank, the Sectorial Committee on Lands, Housing, and Planning has summoned the managing director of the National Bank of Kenya to appear before it on November 6, 2024.

The committee seeks clarification on whether the title deed was indeed used to secure a loan, the amount advanced, and the purpose of the loan.

Additionally, they have requested copies of all relevant documents that the bank relied upon to approve financing for the affordable housing project.

"It has come to the attention of the Nairobi City County Assembly planning committee that the title deed for the parcel of land on which the Jevanjee affordable housing project is being implemented was presented to NBK to secure a loan to finance the said project," reads the letter dated October 30, 2024.

The letter was written by the assembly clerk, Edward Gichana, and addressed to the National Bank of Kenya managing director.

The clerk informed the bank that the committee had resolved that the bank must cease all further transactions concerning the title deed until their investigation is complete.

During a committee sitting earlier in the day, the members had summoned Patrick Analo Akivaga, Chief Officer for Urban Development and Planning to shed light on the matter.

However, the chief officer informed the committee that the memo he received was on different issues that related to responding to statements by MCAs.

The MCAs read mischief and sabotage as they raised concerns about how and who changed the agenda of the meeting.

"We need to know who authorised the change of agenda for the meeting. Where do they draw such powers to do so without the go-ahead of the members?” asked Deputy Minority Leader Waithera Chege,

Minority Leader Antony Kiragu, who is a member of the committee, said that the matter before them was weighty but other parties were taking it lightly.

"The executive is on the verge of receiving money and someone inside the assembly is sabotaging the agenda of this committee," he said.

At this juncture, the assembly resolved to write a letter to the bank to stop any transaction until the matter was deliberated.

"As a committee, we must have members here accompany the clerk when the letter is being written and delivered to the bank just for assurance," said Baba Dogo MCA Geoffrey Majiwa.

The minority leader had earlier raised concern over the project's lack of progress.

"A developer was supposed to come with money, the county with land, and the developer was to construct units and sell to the public. What is shocking is that the Jevanjee project, where almost 1,400 units were to be built, was sold out within a month, yet five years later, there is still no progress," he noted.

Kiragu who is also the Waithaka Ward MCA, also criticised the use of county property to secure a loan against the urban renewal policy.

In previous hearings, officials from the county government, including the County Executive Committee Member for Urban Planning and Built Environment Patrick Mbogo, indicated that they do not possess crucial documents for the stalled projects.

They revealed that the Jevanjee Estate title deed is in the possession of former Nairobi governor Mike Sonko, while the location of the Pangani Affordable Housing title deed remains unknown.

Sonko publicly confirmed that the Jevanjee title deed was used by a private developer to secure the substantial loan.

Tecnofin, the developer, had previously cited financial difficulties, claiming they were overwhelmed by the project's rapid pace.

An attempt by the Nairobi City County Assembly to facilitate access to funding for the project was thwarted by a court ruling against using the project's title as security.

Despite a motion passed by the assembly in April 2023 allowing the use of title deeds for Nairobi Urban Renewal Projects as collateral for funding, legal challenges arose.

A civil society group, Sheria na Watu, filed a case against the Nairobi City County government and the assembly, arguing that the process violated constitutional provisions, as the National Land Commission, the custodian of public land, had not been consulted.