Construction of Sh215bn railway cities to start despite delays

An artists impression of Nairobi Railway City.
An artists impression of Nairobi Railway City. PHOTO/COURTESY
The Kenya Railways is keen to push forward its plan to build “cities” on land surrounding its rail stations in Nairobi, Mombasa and Kisumu, despite the project failing to get off the ground for nearly a decade.

The state-owned agency, which has been scouting for investors, is seeking to build office blocks, shopping malls, hotels, parking bays, industrial parks and arcades on the 320 acres of land that is currently sitting idle.

The mega project estimated to be worth Sh215 billion was scheduled to kick off in 2012, but nothing much has been heard regarding the venture except that it had attracted global interest – with US presidential hopeful Donald Trump being among the interested parties.

READ: Donald Trump indicates interest in Nairobi Golf City

But according to the latest report from a team of officials from the Land and Transport ministries, the project is still on course and will be undertaken through build operate transfer (BOT) – where investors build and operate facilities for several years before handing them back to the state.

“The project will be developed through build operate transfer, franchises and joint ventures under land lease,” the inter-governmental team said in a statement.

The Kenya Railways expects to earn Sh1 billion a year in land lease fees.

The state agency has been scouting for foreign investors with the financial capacity and experience in similar projects to help push forward the ambitious venture.

In Nairobi, the investors will put up – at a cost of Sh120 billion – shopping malls, restaurants, a manufacturing park, and two hotels able to accommodate 3,000 people in Nairobi.

On the other hand, the investors will spend Sh60 billion in the building of an international trade centre, office blocks, shopping malls, and three hotels with 3,000 pax conference facilities in Mombasa.

In Kisumu, the investors will construct a Sh35 billion shopping malls, a vehicle parking complex, restaurants and two hotels able to host 2,000 people.

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