Taj Mall to be demolished as owner risks Sh500m loan default
The servicing of a $5 million (about Sh500 million) loan borrowed from Shelter Afrique to build the Taj Shopping Mall is uncertain after the government Thursday reiterated that it will demolish the building to pave the way for upgrade of the Outer Ring road.
Taj Shopping Mall proprietor Ramesh Gorasia said Thursday he was having difficulties repaying the Pan African mortgager because the mall was only 25 per cent occupied as businesses keep away due to fears of the impending demolition.
But acting Land secretary Fred Matiang’i was emphatic that Taj Shopping Mall would be demolished as part of it sits on a reserve marked for the ongoing dualling of Outer Ring Road.
“I’m having a problem servicing my loan instalments. The threat of demolishing has scared businesses,” Mr Gorasia said on Thursday.
“They (Shelter Afrique) did a search and charged the title. If it had a problem, they would have refused.”
Taj Mall had previously charged the land to NIC Bank in 2000 and finished paying the loan in 2009, according to the title deed seen by the Business Daily.
The charge on Shelter Afrique was registered on September 3, 2009, official records show.
The Sh1.2 billion Taj Mall in Nairobi’s Eastlands suburb of Embakasi, was officially opened on August 1, 2011 by then vice president Kalonzo Musyoka.
The shopping complex is now worth an estimated Sh5.4 billion, according to a July report prepared by Redfearn, a property valuer.
Mr Gorasia said he was yet to repay ‘three-quarters’ of the Shelter Afrique loan. He also disclosed that he had other loans at Fidelity and Standard Chartered banks and an overdraft facility at Diamond Trust Bank.
Taj Mall sits at the roundabout of Outer Ring Road, North Airport Road and Airport South Rd.