Machakos billionaire buys 680 Hotel in Nairobi
billionaire owner of Nairobi’s 680 Hotel has sold the three-star facility to
Machakos-based Maanzoni Lodges for an estimated Sh1.2 billion, highlighting the
hospitality sector’s deal-making.
to a transaction advisor who participated in the transaction and spoke to
Business Daily on the condition of anonymity, it received regulatory approval.
is part of the Sentrim Hotel portfolio, which is owned by billionaire investor
Jagdesh Patel, who hired property agency Knight Frank in 2018 to sell his eight
hotels at a guide price.
sale of the remaining seven properties, which include the Boulevard Hotel,
Castle Royal Hotel (Mombasa), Elementaita Lodge, Samburu Lodge, Sentrim Tsavo,
Sentrim Amboseli, and Sentrim Mara, is nearing completion, according to Knight
680 will be part of the Maanzoni franchises, which include a three-star lodge
with 326 ensuite rooms on a 28-acre land near Lukenya, Machakos.
is associated to billionaire Chris Musau, who revealed plans for an 11-story,
300-bed hotel with luxurious residential facilities in Machakos town in 2019.
deal comes at a time when top hotels are either closing or changing hands as
the industry recovers from Covid-19 travel restrictions.
has completed the sale of 680 Hotel. They needed a presence in Nairobi’s city
centre,” said the advisor to the 680-hotel deal.
which acquired its name from the number of beds it had when it first opened its
doors, is the group’s biggest moneymaker, bringing in Sh213 million each year
to Knight Frank, earnings from 680 can be maximized by either transforming the
property into an office block or allowing the three-star hotel to continue its
hotel is said to have attracted the interest of both foreign and domestic
investors, amid reports that Deputy President William Ruto was interested in
complicated ownership web has buried the individual owners’ names in multiple
layers of local and offshore trusts and corporations inside the Sentrim Group.
submitted to prospective buyers disclose only three individuals as minority
shareholders, with companies as majority shareholders.
Patel, Rajnikant M. Shah, and Harji V. Hirani each own a share in local
companies that own Sentrim Group hotels.
buildings and land are owned by Nairobi-based companies Mayhouse Ltd (680),
Chezer Investments (Boulevard), Newgate Management Ltd (Castle Royal), and
Operation Castle (Sentrim Elementaita).
Patel, Mr. Shah, and Mr. Hirani each own one share in Mayhouse, Chezer,
Newgate, and Operation Castle, with their offshore companies owning the
remaining 128,000 shares.
companies registered in the British Virgin Islands and Mauritius own the
majority of the four local companies.
Musau, the guy behind Maanzoni, began his hotel business as a side project two
years after selling his Nova Supermarkets to retail giant Naivas.
purchased 10,000 acres with the help of local lenders, personal savings, and
family resources, and then sold the majority of it, including to his late
brother-in-law and former Cabinet minister Mutula Kilonzo.
late Mutula’s Kwa Kyelu ranch is close to Maanzoni.
Musau has been looking to expand his company beyond Machakos County, and 680
provides the potential to run a hotel and office space in the heart of Nairobi.
tourism industry has begun to recover from the effects of Covid-19, as local
visitors take advantage of lower pricing, while foreign visitor numbers remain
much below pre-pandemic levels.
sector, which is generally one of the country’s main sources of foreign
exchange, is expected to generate Sh173 billion this year, up 18.5 percent from
last year. Earnings dropped to Sh88.6 billion as a result of Covid
year, they returned to Sh146 billion, with the number of hotel nights occupied
by Kenyan travelers doubling within the same period.
Covid-19 economic crisis, a number of top hotels in Nairobi’s city center,
including Hilton, InterContinental, and Laico Regency, ceased business. Some hotels
Hospitality Fund, which is supported by the Qatar Investment Authority (QIA),
the country’s sovereign wealth fund, has purchased the Crowne Plaza Hotel in
its entirety for an estimated Sh4.6 billion.
billionaire Prince Al-Waleed bin Talal sold his stake in The Norfolk and
Fairmont Mara Safari Club to a Nepalese tycoon for Sh2.8 billion while City
Lodge offloaded Nairobi’s Fairview Hotel, Town Lodge and City Lodge Two Rivers
to real estate investor Actis for Sh1 billion.
resorts, who generally focus their marketing efforts on foreign tourists, were
forced by the pandemic to turn to the domestic market, offering reduced
price rates to entice holidaymakers.
visitor numbers remained significantly lower than pre-pandemic levels, with
slightly under 870,500 in 2018 compared to two million in 2019. This year, they
are expected to exceed 1.03 million.
Read full story as told by Business