Equity Bank Kenya has placed Nairobi’s Eastland Hotel under receivership over an undisclosed debt, underscoring a tougher stance by lenders seeking to recover funds tied up in cash-strapped borrowers in the hospitality industry.
In a notice published in the dailies, the bank said it had appointed Kamal Anantroy Bhatt and Jai Kamal Bhatt of Anant Bhatt LLP as joint receivers and managers of Eastland Hotel Limited, effective September 9, 2025.
“The purpose of this notice is to notify all interested stakeholders that following the receiver’s appointment, the affairs and business of the company shall be directed by the receivers,” the notice stated, adding that only the receivers or their representatives are authorised to deal with the company’s assets and undertakings and that directors’ powers over business and assets no longer apply.
In Kenya, administration pauses creditor actions to try to rescue the whole company, while receivership lets a secured lender enforce against the pledged assets without an automatic pause for other creditors.
Receivership is applied on debts that were contracted prior to September 2015 when the Insolvency Act, 2015 came into force to introduce administration — where efforts are first made to revive a distressed firm before liquidation is considered as a last option.
The enforcement push comes against a backdrop of elevated credit risk across the banking sector and a slight increase in Equity’s stock of non-performing loans (NPLs).
At the group level, the ratio of NPL to gross loans, or the NPL ratio, edged up to 13.7 percent in the six months to June from 12.9 percent a year earlier, Equity’s financial results show.
Hospitality has been among the hardest-hit sectors in recent years, squeezed by high financing costs and a bumpy post-pandemic recovery in business travel.
Non-luxury hotels such as EastLand Hotel have faced increased competition from short-term rentals like Airbnb listings, which have undercut room rates with flexible stays and self-catering options — drawing away both leisure and long-stay corporate guests.
There has also been a rapid expansion of investment in new hotels across various categories including luxury and budget properties, raising competition in the industry.
Banks have increasingly turned to receivership and administration to unlock cash from borrowers who, for various reasons, including a tough economic environment, are unable to service their debts.
While Equity did not disclose the hotel’s exposure, the appointment of receivers typically signals either a covenant breach or prolonged arrears, allowing the secured creditor to step in to recover its loan.
Eastland Hotel, a four-star property in Kilimani, now joins an increasing number of businesses under court-supervised turnaround or creditor control this year.
