By Antynet Ford
Nairobi City County Assembly Sectorial Committee on Planning and Housing Committee is investigating possible fraud on how the initial documents between the Jevanjee affordable housing project and the Nairobi County were amended.
This is after the developer Jabavu Village Limited (JVL), claimed that the land on which the project is being implemented is no longer public land.
According to Nairobi South MCA and deputy Minority leader Waithera Chege, the presence of an addendum means there was an actual document before the amendments were done.
The MCA said there could be possible fraud that was conducted to have the documents changed and have the developer have 80 per cent instead of 1 per cent as in the original document.
She claimed that the agreement between Jabavu Village Limited and Nairobi City County was changed by a few individuals
“There is a likelihood that there was fraud in terms of the amendment of the actual document. Whenever there is an addendum it means that there was an actual document that was there before an amendment was done. We are looking at fraud in the sense that the initial document as SPV shows that Nairobi ought to have taken 99 per cent while the developer was to take the remaining 1 per cent. At what point did the addendum before the government get signed that the developer has 80 per cent and the county 20 per cent? We are investigating fraud.” Waithera stated.
Addressing the media earlier this week, Abdulkadir Hussein, the Managing Director of Jabavu Village (the lead developer behind the Jevanjee affordable housing project in Ngara) said that while the land for the Jevanjee Gardens project was initially owned by the Nairobi City County Government (NCCG), the title deed was legally transferred to a Special Purpose Vehicle (SPV) created for the project, Nairobi Bachelors Jevanjee Estate Limited, in 2019.
“The transfer of the land to the SPV means this is no longer public land. Jabavu Village holds 80 percent of the shares in the SPV, and the NCCG holds 20 percent.” Hussein explained.
“The Nairobi county government’s role was to provide the land, while our company was tasked with sourcing the necessary funds.” He added.
Questions have been raised on whether Jabavu was suited to undertake the project as they have used the title deed of the said land to secure a Sh1.9 billion loan at the National Bank of Kenya.
This was discovered last month by the Nairobi County Assembly.
The revelation sparked further controversy and brought former Nairobi Governor Mike Sonko into the spotlight.
He denied allegations of holding onto the deed while accusing current officials of misinformation.
Sonko had been accused by the Johnson Sakaja-led administration of having the title deed for the estate under L.R No. 209/5458, registered in the Registry of Titles in Nairobi as I.R 199739/1
However, Sonko claimed that the title deeds for both the Jevanjee and Pangani affordable housing projects are in the possession of the National Bank of Kenya.
He said the documents were charged to the bank as collateral for a Sh1.9 billion loan that was approved for a private developer involved in the Jevanjee project.
“The title was taken to the bank as a special purpose vehicle to secure financing,” Sonko said, adding that accusations against him were unfounded.
Earlier this week, Jabavu Limited clarified that the financing for the project was sourced through a bank loan facility of Sh1.9 billion and that they had already been given an upfront of half a billion.
“We have so far drawn down Sh450 million against work certificates issued by the contractor and supporting consultants. The loan is being used exclusively for the completion of the Jevanjee Gardens development, and payments are made directly to contractors, architects, surveyors, and other professionals involved in the project.” Hussein explained.
On April 19, 2023, the Nairobi City County Assembly passed a motion to allow title deeds of the Nairobi Urban Renewal Projects, where the Pangani Affordable Housing Project falls, to be used as security by developers to access funding.
However, a civil society group, Sheria na Watu, filed a case with the Environmental and Lands Court on May 10, 2023, against the Nairobi City County Government and the Nairobi City County Assembly arguing that the move by the latter is unconstitutional.
The court heard that the National Lands Commission was never involved in the process yet it is the custodian of public land. “It was contended that before the approval of the said resolution by the second Respondent, no authorization was obtained from the third respondent to offer the title of the intended Pangani Urban Renewal Project as collateral, for the benefit of the developers, who are private entities.” The judgment stated in part.
Article 62 (2) of the Constitution states that public land shall vest in and be held by a county government in trust for the people resident in the county and shall be administered on their behalf by the National Lands Commission.
Last week, the Nairobi City County Assembly ordered the National Bank of Kenya to stop further transactions using the title deed for the Jevanjee housing project until the Sectorial Committee on Lands, housing, and Planning completes its investigations.
The Jevanjee Gardens project is part of Nairobi’s broader urban renewal initiative aimed at revitalizing old public housing estates and providing much-needed affordable housing to the city’s growing population.
Located in Ngara, just 10 minutes from Nairobi’s central business district, the development will feature two 14-story towers, with a total of 800 residential units.
The project’s progress, however, has faced some delays due to unforeseen challenges. Hussein highlighted that initial setbacks were caused by difficulties in acquiring the land and the global impact of the COVID-19 pandemic, which severely affected the construction industry.
The joint venture between Jabavu Village and the Nairobi City County Government is designed to leverage both public and private sector resources.
