The push to have the Lake Basin Mall in Kisumu handed over to the Lake Basin Development Authority (LBDA) has taken a new turn after a Senate committee summoned East African Community and Regional Development Cabinet Secretary Adan Mohamed to explain the delay.
Mr Adan is expected to appear before the Senate Committee on Devolution and Intergovernmental Relations on July 30 “to apprise the committee” on the circumstances that have made it difficult to pass on the ownership of the mall to LBDA.
Mr Mohamed will also be required to comment on the Auditor-General’s report that found the mall was value for money despite some procurement issues.
This follows a request by Kisumu Senator Fred Outa for a statement from the committee “on the delayed handover of the Lake Basin Mall in Kisumu.”
The LBDA management led by CEO Raymond Omollo have also been summoned by the committee and will appear on July 31.
The matter has taken a new urgency as local leaders push for the handover of the mall to LBDA after it emerged that the expansive 60,000 square metre mall has attracted just a few tenants as claims, counter-claims and a probe by the Ethics and Anti-Corruption Commission take centre stage.
Despite a number of government ministries and agencies explicitly giving the mall a clean bill of health, the combination of the ongoing investigations and the dispute between the contractor, Erdemann Property Ltd, and the government over Sh645 million the former is demanding as financial has meant that prospective tenants have kept off due to uncertainty the prevails.
The other outstanding issue between the contractor and the government concerns the issue of LBDA taking over the Sh2.5 billion bank loan Erdemann took to construct the mall. In the agreement, Erdemann was financing 80 per cent for the mall while LBDA was financing the other 20 per cent. But upon handing over the mall, LBDA was to take over the commercial loan.
EACC has conducted investigations into the mall whose cost shot up from Sh2.5 billion to Sh4.2 billion due to additional works undertaken including construction of a three-star hotel within the mall, a tyre centre, a showroom, boundary wall and back access road among others. Though no one has been indicted by EACC, an investigation file has been forwarded to the Office of the Director of Public Prosecutions (ODPP) for directions.
This push by Kisumu leaders to have the mall handed over to LBDA has also seen Kisumu Central MP Fred Ouda petitioning the EACC to explain the “unending investigations.”
“In public interest, these investigations must end and the mall left to achieve its original objectives,” Mr Ouda pleaded with EACC in a letter received at EACC CEO Twalib Mbarak’s office on July 20.