Equity gets nod to auction Fourways homes in loan row
Equity Bank can now sell mansions belonging to real estate firm Suraya Property Group to recover its loan after the Court of Appeal gave the green light in a protracted battle that seen several parties try to take over the houses in Kiambu.
A bench of three judges agreed with the lender that Equity is a reputable bank and the developer can still recover the money, in case the appeal, which is yet to be heard, is successful.
Justices Roselyn Nambuye, Hannah Okwengu, and Imaana Laibuta said Equity can sell the houses subject to the issuance of fresh notices, as had been directed by the High Court in 2020.
The houses were constructed by China Wu-Yi and financed by Equity for more than Sh1 billion.
Muga Developers, a joint venture partly owned by Suraya was placed under receivership in 2020 by Equity Bank. Mr Muniu Thoithi and Mr George Weru were appointed as the administrators.
“The applicant having offered the suit property as security, it has become a commercial entity that can be compensated in monetary value,” the judges said.
In the ruling, the court noted that Muga Developers has not demonstrated any efforts to repay the loan.
Mr Moses Ndirangu, who works for Equity said the bank has in the past four years made unsuccessful attempts to recover the millions used to finance the housing scheme.
Suraya Property owners- Peter Muraya and his wife Susan formed Muga Developers with the family of the late Samuel Gatabaki in 2007, for the development of Fourways Junction Estate. While the Gatabakis provided the land, Suraya was to source for funds.
The estate is strategically located a short distance from the leafy Runda Estate. It holds a mix of cluster houses, apartments, office blocks, a shopping mall, a three-star hotel, and a fully-fledged country club.
China Wu-Yi has also been fighting to get 10 houses as part of the payment for their services.
Suraya Property has denied the claims stating that even if there was a deal to that effect, the property is charged to Equity Bank which granted the Sh1.76 billion cash for the project.