Kenya’s hotel industry seems to be going through a difficult time as the number of those closing down and those set to be auctioned continue to grow.
The latest hotel to go under the hammer of the auctioneers will be Nairobi’s Upper Hill Hotel. The hotel is said to have secured a loan from the National Bank of Kenya (NBK), now a subsidiary of the Kenya Commercial Bank (KCB).
Auctioneers by the name Garam Investment Auctioneers has invited bidders to deposit 10 million shillings for the 4-storey property that is said to have a gross monthly income of 5 million shillings.
The hotel is owned by businessman Wahome Muotia and the lease of the land is said to be 76 years. Given that it is located in a prime piece of land, it is likely to attract several bidders.
The number of hotels closing down and those being auctioned has been on the rise with stakeholders continuing to dismiss claims that the sector is ailing.
During the month of January, Nairobi’s iconic Southern Sun Mayfair Hotel closed down and all employees fired as the economic wind continues to blow across the hotel sector in Kenya.
The hotel which has been operational for more than 10 years, has confirmed that it will be closing down on January 31, 2020, and that all employees’ contracts had been terminated.
Njenga Karume’s Jacaranda Hotel was set to be auctioned on January 22, 2020, for failing to pay a loan of 253 million shillings. The hotel has been at the center of family disputes among the late Njenga Karume’s siblings.
Boma Hotel, which is owned by the Red Cross has been placed under receivership with all possibilities pointing to it being auctioned if the financial situation won’t ease.
Dove Cage Hotel also closed down due to the tough economic situation. The hospitality industry has always been lucrative in Kenya but with recent ailing of the giants, investors will have to rethink.