The Jacaranda Hotel, a four-star hotel located in the serene suburbs of Westlands, Nairobi that is owned by the family of the late Defence Minister Njenga Karume was on Monday, January 6, put up for auction as reported by Business Daily.
Karume served in the Cabinet under retired President Mwai Kibaki and was a prominent businessman.
Resting on a 3.5-acre piece of land, the hotel is among the business entities associated with the late tycoon.
However, owing to what the publication identified as pending loans, the franchise is set to be auctioned to facilitate the recovery of a Ksh257.6 million owed to a bank.
"Duly instructed by our clients, we shall sell the very prime property in Westlands by public auction," a statement by Regent Auctioneers was quoted by the report.
Having accumulated billions in assets in the course of his career, a battle for the control of his property pitting his children and the trustees, has crippled the estate.
In an interview with the publication, Kung'u Gatabaki, one of the trustees, intimated of his decision to challenge the auction notice in court.
"Our lawyers are preparing to go to court and we still believe it will be settled amicably," Gatabaki was quoted by the daily.
"I cannot say much but you know banks are banks and as lenders, they have to take some action to protect their investors.
"Advertising the property for auction means we have not repaid the loan, but it also does not mean that they will sell it tomorrow," he added.
According to the daily, the auctioneer had in June 2018 notified Jacaranda Hotel's management of an impending auction but was stalled after an assurance from Karume's family that a huge parcel of land owned by the ex-minister would be sold to clear the debt.
The hotel was on the verge of another auction in 2018 after Kenya Revenue Authority convened auctioneers to the recovery of VAT and PAYE tax that totalled to a reported Ksh153 million.
Jacaranda Hotel was on January 12, 2018, issued with a notice to urgently clear tax arrears that amounted to Ksh197 million and on the same day, auctioneers were on the premises to secure the property.
The issue was however resolved after the taxman agreed to a Ksh50 million a month payment plan and a Ksh7.9 million payment to the auctioneers.
