Hotel is worth Sh2b: Valuers

September 26, 2008 12:00 am

, NAIROBI September 26- An independent firm appointed to ascertain the value of Grand Regency Hotel on Friday told the Commission of Inquiry into the sale that it is worth Sh2.034 billion.

Timothy Njehia, the Managing Director of Crystal Valuers Limited, said that after a comprehensive valuation, which considered all assets, the value of the plot hosting the hotel and the goodwill derived from future business prospects, the firm arrived at the figure.

Njehia was however taken to task to explain how he arrived at certain figures, where he revealed that the value of the two-acre parcel on which the hotel is built, was Sh550 million whereas the building was valued at Sh1.35 billion.

“We used a comparative method where we compared the value an adjacent half-acre plot which was sold at Sh140 million,” said Njehia.

Three valuers appointed by the Central Bank of Kenya (CBK) presented three different figures ranging from Sh1.3 billion and Sh2.4 billion and yet the hotel was sold at Sh2.9 billion.

The valuation firm was appointed by the commission to ascertain the present value of the hotel, amid claims that the five-star facility had been undersold.

Meanwhile CBK Governor, Professor Njuguna Ndung’u took to the witness stand for his fourth and last day at the inquiry and told the Justice (Rtd) Majjid Cockar-led commission that he was never intimidated by Kenya Anti Corruption Commission (KACC) Director, Justice Aaron Ringera, during the negotiations leading to the sale of Grand Regency Hotel.

Professor Ndung’u said he had a meeting with Justice Ringera in which they discussed the most effective mode of disposing of the hotel after which the bank settled for sale through ‘private treaty’, as opposed to ‘public auction’.

He informed the commission that he wrote to the director informing him of the decision but did not receive any feedback in regard to the method of disposing of the hotel.

“To the best of my knowledge and from the briefs I had, we did not break any law, or offend public interest and I believe that is the truth as it is and as I know it,” Professor Ndung’u said.

The revelation came against the background of complaints made at the inquiry by KACC lawyer David Kamau on Wednesday that the anti-graft body was kept in the dark during the whole process.

The governor maintained that the transaction was between the governments of Libya and Kenya, insisting that president Mwai Kibaki was never involved.

He also maintained that he constantly dealt with officials from the Ministry of lands saying there was no need to contact Lands Minister James Orengo

The Governor has completed his testimony at the commission, whose mandate is set to expire on Tuesday next week, though there are possibilities that it may seek an extension in order to finish its exercise.

This became evident after lawyer Harrison Kinyanjui, appearing for Westmont Holdings Limited told the commission that there was need to summon Energy Minister, Kiraitu Murungi and Communications Permanent Secretary Bitange Ndemo to explain who committed the government to the deal.

This follows revelations that the two government officials were the signatories to the memorandum of understanding in which the deal was sealed, during President Mwai Kibaki’s visit to Libya in June last year.

The Commission chair asked Mr Kinyanjui to either withdraw the request or make it formal on Monday so that the commissioners can make a ruling.


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