Construction of Africa's tallest building hangs in the balance over land fraud claims

The construction of a multi-billion skyscraper in Nairobi now hangs in the balance after two business tycoons moved to court seeking to have the project stalled over land fraud claims.

Ugandan business tycoon James Mugoya and a member of the UAE royal family have obtained court orders stopping the ongoing construction of the Pinnacle Tower on claims that the developers of the tower have encroached on their land.

The Pinnacle Tower, which is set to host the 45-floor Hilton Upper Hill hotel and a separate 70-storey apartments and office block, is tipped to be the tallest building in Africa on completion.

It sits on a two-acre plot and consists of two towers: the 45-storey Hilton Hotel, and the 70-storey mixed-use wing, which will also include 20 floors of high-end office space, a five-storey shopping mall, and three floors of underground parking.

Land fraud claims

The suit filed in two separate court claims reveals alleged fraudulent transactions dating back two decades.

The claimants want the developers to be held in contempt of a court order issued in January 2017 and July 2015 that restrained any activity on the properties.

Mr Mugoya claims that he purchased the land, LR NO 209/11142, in September 1995 at Sh25 million and says he has been paying rates on it since then.

But in 2016,he learnt that the plot had been transferred to Sigma Limited through a transfer dated November 1998, a transfer he claims was backdated.

He further alleges that the land has since been transferred from Sigma Limited to Garanco Five Limited, who has in turn granted White Lotus, developer of the Pinnacle tower, use of the land.

Kenya Railway Staff Scheme

The Trustees of Sheikh Zayed on their part claim that the land parcel number 209/11552 was a gift to them by retired President Daniel Moi to the President of the United Arab Emirates (UAE) in 1990 and registered in 1992.

They have however had a dispute with the Trustees of Kenya Railways Staff Retirement and Benefits Scheme since 2015 after they demolished the wall on the land.

The Railway Staff Scheme’s have since leased the property to Jabavu Village Limited, also a developer of the skyscraper, which was granted in March 2017.

The court document shows the initial dispute involved the Trustees of Sheikh Zayed, Kenya Railways and a firm identified as Pelican over the same piece of the land. The suit was filed in 2015.

The Trustees of Sheikh Zayed obtained a court order restraining Pelican from interfering with the property, but the two firms have now joined hands to fight the developer, changing the direction of the dispute.

They want the developers to be held in contempt of court for disobeying the orders.

However, the developers have distanced themselves from the accusation, stating they are not aware of any orders and therefore cannot be held in contempt of court.