The Central Bank of Kenya (CBK) Pension Fund is seeking to sell two properties, including a seven-storey commercial building at a combined price of Sh1.08 billion.
The fund manager has invited bidders to submit their interest in the two buildings —Timau Plaza and Twiga Hill Park that are located in Nairobi. Timau Plaza is located on Argwings Kodhek Road, Kilimani while Twiga Hill Park is situated on Lamwia Road in Karen.
Tender documents dated November 11 show that Timau plaza, a seven-storey commercial building that sits on about 0.893 acres and held on a freehold interest, has a reserve price of Sh670.91 million.
In justifying the value, the pension fund says Timau Plaza has mains electricity, water and sewer connected to the property and it also has a borehole to back-up the water supply. A 500 kilo-volt-amperes back-up generator is also connected to the property to supplement the mains electricity.
The fund is also seeking to sell Twiga Hill—a gated residential property located at the junction of Lamwia Road and Twiga Hill roads in Karen. The reserve price for this property, which sits on about 4.883 acres, is Sh409.32 million.
“The tenderer with the highest evaluated price per item or the lot subject to the reserve price will be awarded the bid,” said the pension fund.
The fund has not disclosed the reasons for the planned sale.
Funds such as Telposta and Kenya Railways Staff Retirement Benefits Scheme put on sale part of its real investment properties in bid to comply with the regulatory cap.
The guidelines of the Retirement Benefits Authority (RBA), which regulates pensions in Kenya, puts the maximum portfolio of a pension scheme in immovable property at 30 percent.
The CBK Pension is coming to the property market for buyers at a time many auctioneers are reporting a glut in selling repossessed buildings. Only vehicles have shown increased interest among buyers while houses and office blocks have dragged.
Many buyers have been demanding outsized discounts to reflect the liquidity constraints in the market.
However, given that reserve prices have to be 75 percent of the prevailing market prices, it has been a challenge for auctioneers to compromise without being seen as hurting the interests of the owners of the distressed properties.
The pension scheme is managed and administered by the secretariat appointed by the CBK. The costs of their operations are fully reimbursed to the CBK on a regular basis.
The fund also owns CBK Pension Tower, which is located between Harambee Lane and Haile Selassie Lane. The skyscraper is a 27-storey building with six basement levels, office suites, and retail stores for private tenants.
In total, CBK operates two retirement benefits arrangements namely: CBK Pension Fund and Banki Kuu Pension Scheme.
