Business
KCCA to buy Usafi Market at sh37bn
Publish Date: Jul 20, 2014
KCCA to buy Usafi Market at sh37bn
Although KCCA officials have remained tightlipped on the amount the body is willing to pay, records show that KCCA has allocated sh1.2b as a commitment towards buying the market
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By Chris Kiwawulo, Juliet Waiswa & Brian Mayanja

Mystery shrouds the sale of Usafi Market in Kampala after details emerged that the market was leased out at sh110m three years ago.

The lease holder, Omar Nasoro ssekamatte, now wants to sell it at sh43b. According to sources, the lease was transferred to him from an individual only identified as ssesimba, with the consent of Kampala district land board in 2011. But there are conflicting figures about the market’s going price.

Whereas Ssekamatte asked for sh43b, impeccable sources have revealed that Kampala Capital City Authority (KCCA) is planning to pay sh37.9b, starting this financial year.

According to a ministerial policy statement, the chief government valuer put the market value at sh33.8b.

The parliamentary budget committee chairperson, Amos Lugolobi, confirmed to Saturday Vision that ssekamatte’s asking price was sh43b.

They (KCCA and Ssekamatte) had not yet agreed on the price. But our advice is that the purchase price should not exceed the government valuer’s price,” Lugolobi stated.

The ministerial policy statement for 2014/2015, however, shows that the purchase of Usafi Market was among KCCA’s unfunded priorities at sh28.9b. The statement said KCCA wants to turn the market into a modern business centre.

Although KCCA officials have remained tightlipped on the amount the body is willing to pay, records show that KCCA has allocated sh1.2b as a commitment towards buying the market. Another sh2.90b is expected from local revenue towards the purchase.

The policy statement revealed that the Government also committed to contributing towards the purchase. “A business case on this transaction has been prepared and submitted to the finance ministry and has been presented to the parliamentary budget committee,” the statement noted.

When asked the price at which KCCA was to buy the market, presidency and Kampala minister Frank tumwebaze said: “Get details from the executive director (Jennifer Musisi) or the spokesman (Peter Kaujju).” Whereas KCCA opened boundaries for Usafi Market, its actual size also remains a mystery.

However, sources intimated that both Usafi Market and Usafi Park measure up to about six acres. Finance ministry spokesperson Jim Mugunga confirmed that his ministry was committed to funding the market purchase.

He argued that KCCA was like any other Government entity, with which they have a mutual working relationship.

Mugunga, however, said he was not aware of the amount that KCCA had proposed to buy the market, let alone the agreed modalities of payment. “I don’t know whether the money will be part of their budget allocation or direct funding. It is better you get the figure from KCCA.”

Kampala land board chairman yusuf Nsibambi, confirmed that Ssekamatte secured the market lease in 2011 at sh110m. He explained that KCCA ceased to own the market land the moment the Land Act came into force (1998), which gave district land boards powers to lease former public land.

“The premium for the lease is nominal, that is why we leased Owino Market at sh50,000. The premium is 10% of the unimproved value of the property, according to the law. The lease is not a full term purchase and therefore its value cannot be based on prevailing market prices.

“When we leased the market to Usafi, KCCA was collecting city rates, market dues and ground rent. So, the amount that ssekamatte paid for the lease at the time was fair,” Nsibambi explained.

Nsibambi said Ssekamatte was free to sell the market because the initial period given by the land board within which it can decide on the lease had elapsed.

“After the initial lease period, he is free to sell the land at the prevailing market prices.”

KCCA’s interest

KCCA noted that the number of vendors in the market had risen from 958 when it was commissioned to 2,415 to date. With 5,000 stalls, the market, located at Kalitunsi in Mengo-Kisenyi, was opened on March 1, 2013.

According to KCCA, Usafi Market has the capacity to accommodate 7,000 vendors and this would reduce the number of illegal street vendors.

KCCA noted that Usafi Market sits on a large piece of land and that it was strategically located at the apex of major routes, with double frontage on Katwe road and Mengo Hill road.

The city authority added that they chose to procure the market because of: “the availability of a gazetted taxi park which facilitates both the vendors and market-goers.”

The market has several developments, including an administration block, lock-up shops, permanent market stands and stalls, a butchery block, toilet block, a police post, generator room and barbershop block.


Usafi taxi park is located just behind the market

Besides, KCCA said they received a petition by small scale traders, initially submitted to the speaker of Parliament, rebecca Kadaga, imploring the Government to allow KCCA to take over the ownership and management of Usafi Market.

Kadaga, in a June 19 letter to the city executive director, asked KCCA to fully take over the market In January, street vendors who relocated to Usafi Market expressed dissatisfaction over the way KCCA was handling their stay at the market.

The traders claimed that the market owner (Ssekamatte) was charging them extra money in addition to the sh80,000 monthly dues. They had refused to pay the dues, until KCCA intervened.

Ssekamatte could not be reached for a comment as he was reported to be out of the country. 

KCCA councilors want to block sale

As several stakeholders are pushing for KCCa’s take-over of Usafi Market, city councillors have vowed to block the move with some arguing that procuring the market would be a waste of taxpayer’s money.

Makindye division councillor Allan Sewanyana is of the view that KCCA should instead set up markets on other plots of land that the authority acquired last year.

“We procured land in Bukoto, Ntinda, Busega and Nakulabye. Why don’t they use the sh33b to construct markets in these areas? I have to convince fellow councillors to fight this theft at City Hall,” he said.

Nakawa councillor Apollo Mugume, who is also KCCA’s internal audit chairman, noted: “KCCA has budgeted to procure Usafi Market this financial year, although some of us think the Government valuer and other parties involved inflated the price to sh33.8b.”

But KCCA spokesperson Peter Kaujju recently maintained that plans were under way to procure the market, to get rid of street vendors.

“KCCA engaged with the proprietor of the land on which Usafi Market is situated. Communication of the procurement will be made in due course,” he said.

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