Jubilee Party HQ Facing Ksh435m Auction

The seven-storey building in Nairobi leased out for nearly a decade to the ruling Jubilee Party was on Monday put up for auction, with the bank targeting raising Ksh435 million from the prime property.

Stanbic Bank Kenya is seeking to recover the millions of shillings over a debt that fell into default last year, people familiar with loan say.

The Nairobi office bloc, which was Jubilee party’s centre of operations in 2013 and 2017 elections, will be sold when the auctioneer’s hammer falls on September 13.

However, in 2021, the buzz of activities in the party scaled down after the fallout between President Kenyatta and Deputy President William Ruto.

“All that parcel of land known as LR no 209/1530 Emani Business Centre along Thika Road, Pangani area, Nairobi County registered in the name of Farmers Industry Limited, g/t… Florence Wairimu Mbugua. Bidders will be required to produce a bidding deposit of Ksh5 million by way of cash or bankers’ cheque before being allowed to bid,” the auctioneer said.

Default on mortgages have jumped in recent months, pointing to widespread distress in the real estate sector as Kenya’s economy recovers from COVID-19 economic hardships and property auctions pick up.

Bank loan defaults have crossed the half-a-trillion-shilling mark for the first time, setting up thousands of borrowers for property seizures in an economy hit with reduced cash flows and inflation that has squeezed household budgets and demand for goods.

The latest Central Bank of Kenya (CBK) data shows that defaulted loans rose by Ksh30.6 billion in June to Ksh514.4 billion.

Auctioneers say asset seizures are up this year, but they are having difficulties selling the assets in a market witnessing a glut of repossessed vehicles, land, homes, and office equipment. This underlines the cash crunch in the economy.

Commercial banks are shunning forceful auction of property seized from loan defaulters in favour of private settlement after Kenya’s soft economy slashed asset prices below the minimum bid value set in law.