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Mombasa prime property to be seized in Sh14b land rates recovery bid

COUNTIES
By Patrick Beja | Nov 16th 2016 | 4 min read

 

Mombasa County Govenrment has started clambing prime properties within the county in a bide to recover land rates amounting to more than Sh14 billion from property owners, November 15, 2016. Among them is ths TSS Towers which is owned by Mombasa business tycoon Twahir Sheik Said and Spendid Hotel among others. [PHOTO BY GIDEON MAUNDU/STANDARD].

Property owners in Mombasa are in a panic after the county government started to attach properties over unpaid rates.

The county seeks to recover Sh14 billion in unpaid rates and is targeting 426 prime properties. Some of the buildings targeted include TSS Towers on Nkrumah Road and the iconic Splendid Hotel on Msanifu Kombo Road in the central business district.

Government institutions and ministries are the biggest defaulters, owing the county government Sh6 billion in land rates.

State corporations targeted include Kenya Broadcasting Corporation and Kenya Railways Corporation.

The county government has begun a process that will see land rate defaulters lose their property.

Governor Hassan Joho’s government is owed Sh14 billion in unpaid land rates that have accrued for years. This is enough to run the county smoothly for two years. Mombasa gets about Sh5.7 billion a year in equitable share from the Exchequer.

To recover this debt, the county will take over ownership of 426 units of prime property, some of which are located in the central business district.

Some of the targeted buildings are TSS Towers on Nkrumah Road and Splendid Hotel on Msanifu Kombo Road where notices were placed warning of the impending takeover.

TSS Towers is owned by business mogul Twahir Sheikh, whose empire is embroiled in multi-faceted legal battles involving his children and bankers.

County Lands Executive Antony Njaramba confirmed the notices placed on prime properties - mainly land - across the county as part of the recovery process.

“We have clamped 426 properties as at yesterday (Monday). We have so far recovered Sh50 million in the process,” Mr Njaramba said yesterday.

BIGGEST DEFAULTERS

He added that the clamping began two weeks ago and would go on until they recovered the outstanding rates.

“The notices express our intention to take over management of the buildings. The owners can still rush and pay,” he explained.

The county placed the notices on the affected buildings but they were immediately removed by unknown people.

National government institutions, ministries and installations are the biggest defaulters. They collectively owe the county government Sh6 billion in land rates.

The threat sparked panic because the targeted properties include some of Mombasa’s most imposing buildings and State corporations such as the Kenya Broadcasting Corporation (KBC).

Most of the rates have been pending for decades and the amount the county is claiming includes accrued interests the county government began collecting two weeks ago.

Authorities said they were ready for any legal challenges and would also sue property owners for refusing to pay taxes and levies.

The county government plans to seize the units to begin receiving rent from tenants in some of the buildings.

KBC and the Kenya Railways Corporation (KRC) are among those whose units have been clamped or placed under county government management. KBC was in a tussle with the county over Sh400 million unpaid land rates.

County officials explained that they decided to place the notices on the doorsteps of the affected units because they had previously complained that they did not see notices placed in mainstream media.

Some of the main defaulters placed in the media in February and March this year were Kenya Revenue Authority, Kenya Power Company, KRC, KBC, Kenya Ports Authority Pension Scheme, Department of Defence and Kenya Ferry Services.

County Secretary Francis Thoya confirmed yesterday that they were seeking to recover Sh14 billion from property owners who had dodged paying rates in accordance with the Rating Act Chapter 267.

BUILDING PLANS

He noted that most of the buildings in the central business district were defaulters and risked being placed under the county government’s management after the notices expired.

“In the past, property owners claimed they were not aware of the notices we publish in newspapers for defaulters. Now we have placed the notices on the buildings as we begin the process of taking over the properties,” Mr Thoya said.

According to him, parastatals were the leading rate defaulters.

“We are in the process of attaching properties to recover rates. The Department of Land will take over the management of buildings where rates have not been paid,” he added.

In February, Thoya warned that the county government would stop all developments or approvals of building plans for defaulters until they settled the debts in full.

“We will stop any developments or transactions by defaulters until they pay the rates and get clearance certificates,” Thoya had said.

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