The official receiver has moved to lease out Cytonn Investment’s 3.99-acre land in Kilimani, which has been at the centre of a liquidation battle in court.
In a tender document, the official receiver has invited bidders to apply for the lease of three pieces of land —one acre, 1.5 acres and 1.497 acres—located at Argwings Kodhek Road in Kilimani for a period of one year.
This comes hardly a month after the official receiver Mark Gakuru accused Cytonn founder Edwin Dande of hiring individuals to forcibly take possession of the three pieces of land—something that Mr Dande denied in court.
“The property(s) shall be used and occupied by the bidder (tenant) exclusively for private business, profession and trade. However, the Official Receiver shall agree with the tenant the type of business, profession and trade before signing of the lease agreement,” reads the tender dated November 7, 2024.
“The lease shall be for a period of one year and shall be subject to the liquidation order being in place and the Official Receiver acting as a liquidator.”
The money received from the lease will be used in meeting operating expenses such as security services, which are costing the official receiver about Sh100,000 a month.
The creditors gave the official receiver the greenlight to lease the three pieces, locking out Cytonn, which had also advertised the land for lease.
Cytonn last valued the three properties in 2021, putting their fair value at Sh1.4 billion and forced value at Sh1.05 billion.
The troubled firm had planned to put up a mixed-use development of 30 floors of 174,139 square feet office and commercial space for rent, hotel rooms, serviced apartments, three-bedroom duplex apartments and penthouse suites as well as parking floors. However, the Nairobi County government stopped the proposed project.
Cytonn's case at the High Court is coming up this Friday, with over 20 applications on the table. The firm’s challenges arose from two products —Cytonn High Yields Solutions (CHYS) and Cytonn Real Estate Project Notes (CPN)— through which it pooled money from individuals, promising a return.
Defaults on interest kicked in a legal process that saw CHYS and CPN placed under liquidation on January 6, 2023 and the official receiver appointed as the liquidator in bid to recover investors’ money.
However, since the two had no assets of their own, the official receiver had to turn to assets acquired using money from the two entities.
This is how the Kilimani properties became of interest to the official receiver.
