The facility will be the first of its kind in the sub Saharan Africa.
Watchdog asks developer to redesign the project or seek an alternative site.
Shopping malls are posting huge losses as ongoing supply glut compels landlords to cut rents.
UAP-Old Mutual Tower has added 300,000 sq feet of Grade A office space in Nairobi's Upper Hill area.
The Sh4.2bn mall that was completed in 2017 is yet to sign its first anchor tenant.
Too few residents have the financial capacity to shop at the facilities regularly.
Palm Exotica, a 61-floor luxury hotel-cum-residential project, will cost an estimated Sh28 billion.
The building has remained under construction for three decades despite budgetary allocations.
The rising supply of new offices is giving tenants an upper hand in lease negotiations.
Britam Tower was designed by GAPP Architects & Urban Designers and Triad Architects.