The National Social Security Fund (NSSF) has been put on the spot over a stalled Sh2.15 billion housing project in Nairobi’s Nyayo Embakasi area, which is now 12 years past the estimated completion deadline.
An assessment by Auditor General Nancy Gathungu revealed that as of October 2025, the NSSF had only constructed 44 units as part of the Nyayo Embakasi Estate Phase 4 project, out of the 324 units captured in the contract.
The Auditor-General said that the NSSF management has claimed that the project has stalled due to delayed regulatory approvals by the Nairobi County government.
“The contract for the construction of 324 units at Nyayo Embakasi was signed on February 21, 2013, for 78 weeks from June 2, 2013, to November 30, 2014, at a total cost of Sh2,155,407,742,” Ms Gathungu said.
“However, the construction stalled. Although management explained that the project stalled due to lack of approval for the change of user by the Nairobi City County government, no evidence was provided to support this explanation. As at the time of audit in October 2025, only 44 units had been constructed.”
The NSSF has over the years majorly invested in the housing sector, hoping to ride on the increased demand for quality yet affordable houses by the middle class.
The units at Nyayo Estate phase four are part of NSSF’s ambitious housing project across several estates in the city, including Kitisuru, Highrise in Kibra, and Mountain View, where the fund targeted the middle-class workers.
Under the plan, buyers could get units under the tenant-purchase scheme, where they pay deposits of between 10 and 15 percent of the value of a unit and then clear the balance in 15 years.
A section of Nairobi's Nyayo Estate Embakasi. The estate is reputed for both its vastness and neatness.
But the Nyayo Estate Phase Four project flew into headwinds, risking member contributions and growing uncertainty on whether the remaining 280 units will be delivered.
NSSF has continued to invest in the housing projects, with the latest being two Sh1.4 billion projects in Machakos and Kisumu Counties.
The Kisumu project is already underway with the full budget of Sh700 million already allocated, while the start of the one in Machakos was shelved to the current financial year ending June 2026.
Recent disclosures show that the NSSF also targets a debt facility of up to Sh1.6billion to finance the construction of a mega affordable housing complex in Kisumu’s Milimani area. The debt would form part of Sh1.95billion financing for the housing project that will comprise 162 units.
“The project will be fully funded by funds from NSSF at an estimated cost of Sh1,953,426,539.00. The project will be debt-financed by a debt facility up to Sh1.6 billion. The financing plan results in total loan exposure of 65percent compared against the project cost, which is within most lending institutions' lending requirements, which caps the Loan to Value (LTV) ratio to 70percent,” the fund said in a disclosure.
LTV represents the proportion of an asset that is being debt-financed. LTV represents the proportion of an asset’s value that a lender is willing to provide debt financing against. It’s usually expressed as a percentage.
The NSSF said that its proposed Kisumu housing project will consist of 108 units of two-bedroom apartments with domestic servant quarters (DSQs) and 54 units of three-bedroom apartments with DSQs.
“The project has mixed-use character as observed from the mix of single dwelling and apartment residential developments, religious facilities, hospitals (Nitingale Medical Center- Milimani), hotels (Kalongo – longo restaurant), and schools Xaverian Primary School) in the immediate neighbourhood,” NSSF said.
