Firm questioned on Sh300bn urban housing deal

Edermann director Zebin Yang. [Standard]

The Nairobi County Assembly has expressed concern about the legality of contracts signed between City Hall and housing developers behind a Sh300 billion project.

The urban renewal initiative will see buildings in several old estates in the city brought down and replaced with modern low-cost houses.

But last week, the County Assembly Planning and Lands Committee poked holes into the project contracts, terming them illegal.

The committee said that no housing policy was used when signing the contracts, thus making them illegal because they were not anchored in law.

“At no point did the assembly pass or ratify that the county could do any transaction involving land. So the policy used to sign the contracts was not ratified by the assembly, meaning the contracts are null and void,” said Anthony Kiragu, the chairman.

He further said the county assembly was in the process of coming up with a housing policy that would be tabled for the Third Reading this week.

“For the contracts to be valid, they will have to be aligned with the policy that is before the county assembly. How can contracts for houses meant to benefit Nairobians be signed, yet the county has no housing policy?” asked Mr Kiragu.

But appearing before the committee, Edermann company director Zebin Yang defended the legality of the contracts, saying they had the backing of the national government and the City Hall executive.

Edermann has been contracted to develop phases 1 and 2 of the urban housing project on Ngong Road at a cost of Sh48 billion.  

“We entered into an agreement with the county government and these contracts have already been deposited with the relevant offices such as Sheria House. They have been given the nod, so I do not see what the fuss is all about,” said Mr Yang.

The committee, however, pressed Yang to explain contentious clauses in the contracts such as one that required the county executive not to disclose any contents of the contract to third parties.

It was also revealed that there existed a clause that gave the developer the power to change prices for the housing units without seeking the input of the county government.

“The committee looks into areas where we feel that the county is getting a raw deal. We find no reason why the contents of the contract should be confidential unless we want to hide behind a clause to do an illegality,” said Kiragu.

Yang said: "We are ready to amend clauses such as those touching on pricing of the houses because we recently changed the house designs. We did this to ensure that they were in line with the housing policy issued by President Uhuru Kenyatta."