Nakasero Market: Basajja told to pay sh4b

May 15, 2007

KAMPALA City Council has asked Hassan Basajjabalaba, the owner of Sheila Investment Ltd, to pay over sh4b for the lease of Nakasero Market plots.

By Florence Nakaayi
KAMPALA City Council has asked Hassan Basajjabalaba, the owner of Sheila Investment Ltd, to pay over sh4b for the lease of Nakasero Market plots.

This follows the council’s decision to lease the market to Sheila for redevelopment. In a May 8 letter to the managing director of Sheila, the acting town clerk, Ruth Kijjambu, said the new development was a result of the harmonisation of the legal and technical position undertaken by council.

“You should note that all the earlier communications to you in respect of the redevelopment of Nakasero are rescinded,” she said.

“The offer is subject to the settlement of the case in court.” Kijjambu said the firm, which manages the market, should pay a premium of sh1.29b and sh39m for ground rent for Plot 7B per annum.

Basajjabalaba was also asked to pay a premium of sh2.6b and sh79m ground rent for Plot 4B per year. “After fulfiling the above condition (payment), you will contact the city advocate to prepare an initial five-year term sub-lease extendable to 49 years,” she said.

The council last week resolved that Sheila Investment would get 70% of the market and the tenants would retain 30%.

Earlier on, the city authorities had valued the market at sh2b but leased the market to Basajjabalaba at sh248m. Basajjabalaba claimed he had invested sh1.9b in the market, forcing KCC to scrutinise the project.

The council claimed that Basajjabalaba owed it sh625m arrears for the management contract of the market.

The matter became controversial and forced the parliamentary committee to intervene. Kijjambu later cancelled the firms’s contract to manage Nakasero Market, causing Basajjabalaba to petition the court.

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