The High Court has quashed notices issued earlier this year seeking interested buyers for Nairobi’s 14 Riverside Drive, which houses the DusitD2 hotel.
The court ruled that the process Synergy Industrial Credit and Moran Auctioneers followed in the proposed public auction scheduled for May 26, 2026, was defective and invalid.
However, the judge said Synergy is free to issue fresh notices and execution documents, provided they strictly comply with the law.
“I have carefully considered the material record. I find that contrary to Synergy’s submission, the execution instruments relied upon were defective,” the judge said.
The court identified several defects in the execution process, including the failure to properly state the reserve price.
Under the Auctioneers Rules, a warrant for the sale of immovable property must include the reserve price for each separate parcel of land, based on a professional valuation conducted not more than 12 months before the proposed sale.
The court also found that the sale documents failed to disclose registered encumbrances, as required under the Civil Procedure Rules.
“In the present case, the warrant marked encumbrances as NA, which is not applicable or not available, omitting the four registered long leases,” the judge said.
The court said the requirement for a reserve price is intended to safeguard against property being sold at an undervalue.
“Consequently, the notification of sale and warrants of sale alongside the auctioneer's notice and advertisement are invalid and must be set aside,” the court ruled.
The judge said Cape Holdings remains the registered proprietor of the property until a sale is lawfully completed.
“The notification of sale in respect is set aside for lack of compliance with the procedure. The respondent (Synergy) is at liberty to issue execution documents strictly complying with the law,” the judge said.
The dispute stems from Synergy’s efforts to recover a debt arising from an arbitral award of Sh1.66 billion, which has since grown to about Sh10.7 billion due to accumulated interest.
DusitD2 hotel complex in 14 Riverside Drive, Nairobi.
Photo credit: File | Nation Media Group
The dispute dates back to a 2011 agreement under which Cape Holdings agreed to sell office space in the 14 Riverside development to Synergy for Sh703.2 million.
After the transaction collapsed, an arbitrator awarded Synergy Sh1.66 billion in 2015, comprising the purchase price, interest and other losses.
The High Court initially set aside the award, but it was later reinstated on appeal, paving the way for years of enforcement proceedings.
A November 2020 valuation by Knight Frank placed the mixed-use development’s market value at Sh7 billion and its forced-sale value at Sh5.25 billion.
Cape Holdings has also filed a separate petition asking the High Court to determine whether the continued accumulation and enforcement of interest on the decretal amount violates constitutional protections, including the rights to equality, dignity and property.
The company argues that the amount claimed has grown substantially beyond the original arbitration award.
According to court documents, the arbitrator awarded Synergy Sh1.666 billion, while warrants of sale and a notification of sale issued on March 16, 2026, put the amount allegedly due at Sh10.679 billion.
Parliament and Synergy Industrial Credit have opposed the petition. Synergy argues that Cape Holdings seeks to reopen a matter that has already been determined by various courts.
