Delays at City Hall hold back Sh5.2b Upper Hill condos
Eighty-eight Nairobi Condominium, a Sh5.2 billion residential project in Upper Hill under development by Lordship Africa Group has stalled following a delay in approvals by Nairobi county government.
Plans for the 44-floor Upper Hill Tower comprise 288 residential units priced at between Sh11 million to Sh30 million. Launched in 2018, the development was set for completion by mid-2020.
Group’s chairman Jonathan Jackson says the project has stalled following delayed approvals from the City Hall, thus affecting implementation plans.
This comes as investors, contractors and developers decry delays in the processing of construction permits by some county governments such as Nairobi and Kiambu, frustrating project implementation timelines.
Officials blame e-permit system downtime, inadequate staffing and suspension of planning committees of the Nairobi, Kisumu, Kiambu, and Mombasa county governments.
Corruption is also a major factor. Currently, construction permits can take as long as two years.
The lack of improvements of the administration system has continued to cripple the ease of doing business in the construction industry.
The delays in permits prompted the industry players such as the Architectural Association of Kenya (AAK) and the Kenya Private Developers Association (KPDA) to call for an immediate resolution of the matter last year.
At a press briefing last September, AAK and KPDA officials said E-Construction permit systems had failed in many counties, thus stalling the building and construction sector as many projects fell behind schedule.
“This has caused financial burden to developers who rely on bank financing for their construction projects and negatively affects the ease of doing business in Kenya,” Mugure Njendu, President, AAK said.
KPDA Director, Gikonyo Gitonga, called for a one-stop-shop for processing all construction permits and synergies created by the E-Construction Permit to simultaneously reduce the time taken to issue permits.
Delays in the approval system ultimately leads to unnecessarily high development costs for private developers, and is thus a major setback to the real estate sector.