Diamond Property Merchants, a land buying and selling company associated with Tigania East MP Josphat Gichunge, risks losing one of its prime properties after defaulting on a loan from Consolidated Bank.
The lender Monday, through Leakey’s Auctioneers, advertised that the 28-acre freehold land located on Kangundo Road, Machakos, is up for sale.
The move risks exposing hundreds of buyers, who had purchased the land and were planning to put up houses, to major losses.
An official at Leakey’s Auctioneers told the Business Daily in confidence that they intend to sell the property to recover the money that the investment company owes the bank.
“The property will be sold as a block but not as subdivided plots to recover the money Diamond Property Merchants owes to Consolidated Bank. For now, I am not in a position to disclose how much they owe to the bank because of the bank-client privacy issues,” said the source at Leakey’s Auctioneers
Mr Gichunge, who is one of the directors of Diamond Property Merchants and Tigania East MP, said he is aware of the auction notice and would seek to resolve the matter with the bank.
“I am aware that the Consolidated Bank, which we owe some millions, has gone ahead and placed one of our properties in the newspaper for sale.
“We are in touch with them to resolve the matter,” he said on a telephone interview.
“What is there is that we are going through some financial difficulties that we hope to resolve soonest.”