Economy

Nyeri governor to pocket Sh1bn for Nairobi Southern bypass land

gachagua-pic

Nyeri Governor Nderitu Gachagua. PHOTO | JOSEPH KANYI | NATION MEDIA GROUP

Summary

  • Mr Gachagua got the big relief after the court dismissed the government’s claim that the property marked for demolition had been built on the Southern Bypass reserve land.
  • The Business Daily was unable to reach Mr Gachagua to establish if their valuation of the property has since changed and how much he expected to be paid for it. The NLC said that it was yet to establish the property’s worth.

Nyeri Governor Nderitu Gachagua is set to pocket nearly Sh1 billion as compensation for his land that the government is acquiring for the construction of Nairobi’s Southern Bypass.

The National Land Commission (NLC) on Friday made public through a Kenya Gazette notice its plan to acquire the 1.2-acre plot on which Mr Gachagua has built 80 apartments — making it one of the highest payments the government is set to make to acquire land for road construction.

The notice came a few months after the Environment and Land Court directed the government to compensate Mr Gachagua for the intended demolition of his property.

Mr Gachagua got the big relief after the court dismissed the government’s claim that the property marked for demolition had been built on the Southern Bypass reserve land.

Justice Mary Gitumbi had in February 2015 ruled that Mr Gachagua be compensated at the rate that is determined by the NLC should the forced takeover and demolition of the property take place.

“The petitioner is entitled to just compensation as may be determined by the National Land Commission for the suit property and the development that has been erected thereon should the respondents proceed with the entry into the suit property and demolition of the development thereon,” the judge ruled.

The impending mega compensation is the latest signal of the heavy price the State is paying for the chaos at the lands registry that has left it with no option but to spend billions of shilling to acquire the land it needs to develop public infrastructure.

The property located in Nairobi’s South C estate is registered under Vipingo Beach Resort Limited, a company in which Mr Gachagua has 89.94 per cent interest, according to information at the Registrar of Companies.

Valuation of the property

Susan Nderitu owns a 10 per cent stake in the company, the governor’s brother Rigathi Gachagua has a 0.01 per cent interest while a Mr Kenneth Gachagua owns 0.05 per cent. Vipingo Beach Resort had in suit papers filed in 2012 indicated that the property had a conservative value of Sh800 million.

The Business Daily was unable to reach Mr Gachagua to establish if their valuation of the property has since changed and how much he expected to be paid for it. The NLC said that it was yet to establish the property’s worth.

“A team is on the ground doing the valuation. We have to do the valuation and tell the government how much the acquisition will cost,” Abigail Mbagaya Mukolwe, the NLC vice-chairperson, said.

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The Kenya National Highways Authority (KeNHA) did not explain why it was necessary to acquire the land despite the fact that the 29km bypass is complete and fully operational.

“Land is normally acquired for various reasons among them development of new corridors, re-alignment of difficult sections e.g. swamps, graves or ancestral/sacred reservations, development of common user facilities such as bus stops, parking bays, and other facilities such as interchanges,” KeNHA communication director Charles Njogu said.

Mr Gachagua, 63, was elected Nyeri governor in March 2013 and served as a Member of Parliament for Mathira between 2003 and 2007.
He holds a degree in building economics from the University of Nairobi.

Court documents indicate that the title for the 1.2-acre piece of land is dated August 2002 and Vipingo Beach said it commenced construction of the apartments in 2009. The court papers also show that the then City Council of Nairobi advised Vipingo Beach to seek clearance from KeNHA and the Kenya Railway Corporation before embarking on construction work.

KeNHA in 2010, however, marked the upcoming structures for demolition, insisting they were built on land that had been reserved for the bypass. Two years later, KeNHA officials visited the site without informing Vipingo of its intentions, prompting the company to seek redress in court.

Vipingo said that at the time, it had borrowed Sh120 million from Equity Bank for the project, which it stood to lose if the houses were demolished.
In response, the then Cabinet Secretary for Roads, Michael Kamau, questioned the validity of the title deed, insisting that a 120-metre wide corridor had been set aside for the road and the railway as early as the 1980’s.

The road and the railway were to occupy 60 metres each, leaving Mr Gachagua’s property in the middle of the road reserve. Mr Gachagua, however, got relief from a paragraph in the 1990 letter that the Roads ministry wrote to the Kenya Railways indicating that part of the mapped corridor lay on private property.

It was that paragraph that led Justice Gitumbi to dismiss Mr Kamau’s argument that some of the titles held by private land owners were fake.
“The third respondent (KeNHA) did not explain how come the Nairobi Southern Bypass has been constructed and is in actual use, yet the suit property is intact,” Justice Gitumbi added in her judgment.

The building of the Sh17.2 billion bypass started in November 2011 with a June 2015 completion date, but a multitude of court cases filed slowed down construction work and delayed its completion.

Former Kiambaa legislator Stanley Githunguri also had a long-running court battle with the NLC, seeking compensation for a 10-acre piece of land in Karen that also lay on the path of the same road.

The businessman had demanded Sh652 million for his land or more than four times the Sh155 million the NLC had offered him. The matter was settled out of court for an undisclosed amount.

The NLC is also set to pay Sh400 million to the owners of a 5.8-acre parcel on which part of the bypass is built.

The two cases are part of the multi-billion compensation claims the government has had to settle in recent months as it acquires land to develop the much-needed road, rail, pipeline and electricity infrastructure.