The multi-billion shilling mixed-use complex that houses the Dusit D2 hotel on Nairobi’s Riverside Drive will now be auctioned next month, ending a decade-long court battle between friends-turned-foes.
The complex will be auctioned on April 11, 2025, with bidders required to deposit 25 percent of the accepted bid price.
“The development will be sold as a whole on an “as-is-where-is” basis,” Phillips International Auctioneers said in a notice date March 20, 2025.
The feud that culminated in the auction began in 2009 when Cape Holdings Limited decided to develop the complex near the University of Nairobi’s Chiromo campus.
The directors of Cape Holdings then invited their friends at Synergy Industrial Credit Ltd to buy blocks in the property earmarked for development.
Synergy Industrial Credit then paid Sh750 million for two blocks, comprising 14 units and parking lots.
Trouble started when the property was completed and Cape Holdings allegedly refused to transfer the property to Synergy Industrial Credit as agreed.
A legal battle ensued, starting with an arbitrator, escalating to the Supreme Court and then back to the High Court, which sanctioned the sale last year.
As the court fight raged, I&M Bank was dragged into the fray, claiming that it had an interest in the property as it had granted a loan of Sh2.82 billion to Cape Holdings that was secured using the property.
The scheduled April 11 auction would be the third attempt by Synergy Industrial Credit to sell the property as the firm claimed that the debt now stood at more than Sh9 billion.
The property sits on about five acres of land and has a mixed development of office blocks, a five-star hotel with a swimming pool, a parking silo, food court and a cafeteria with a garden.
The hotel has 101 rooms and suites, comprising a ground floor plus seven storeys of the main hotel building and four storeys of another office block. The hotel has a bar, restaurant, library, gym, meeting rooms, conference and banqueting halls, spa, swimming pool and an open-air restaurant, underground stores, changing rooms and a generator room.
The commercial office blocks have various office blocks, including banking halls and shops, the advertisement said.
“All interested bidders are requested to view the property and verify the details independently to their satisfaction as these are not warranted by the auctioneer or any other party,” Phillips International said.
Attempts by I&M Bank to appoint administrators to manage the contested property were dealt a blow in December when High Court judge Josephine Mong’are dismissed the application.
Justice Mong’are also revoked the appointment of PVR Rao and Swaroop Rao as joint administrators of Cape Holdings Limited.
The administrators had rushed to court to block Synergy Industrial Credit Ltd from selling the property, arguing that the administration would expire in March 2025 and that the court’s permission was required to sell the property to settle all lawful debts.
Justice Mong’are discharged the administration saying the proceedings reinforced the position that Cape Holdings was using the administration process under the Insolvency Act to avoid satisfying the order held by Synergy.
“As such, the administration proceedings against Cape Holdings cannot proceed as the present proceedings are an abuse of the court process and also in light of the Court of Appeal’s findings that I&M Bank has no legal interest in the suit property, over which the impugned debenture was created,” said the judge.
The judge said the application was a classic case of abuse of the court process which the court could not countenance.
Earlier, Justice Mong’are had rejected an application by Cape Holdings to review the Sh1.6 billion award given to Synergy in 2015 by an arbitrator following the botched sale deal.
Apart from the 14 Riverside complex, Justice Mong'are also blocked Cape Holdings from interfering with, transferring or dealing with several properties in Kajiado that were developed during the pendency of the case.
