How Urithi members paid millions for air

Urithi, a housing co-operative that has marketed itself as the best bet for those who cannot afford mortgages, has sold air to unsuspecting Kenyans, killing their dreams of becoming homeowners.

In yet another property scandal, more than 32,000 members of the co-operative are counting their losses. Those who had taken bank loans to finance their purchases are dealing with double losses, given that they have nothing to show for the money.

The losses run into billions of shillings, Urithi having run out of lies to feed its investors. Some have waited for more than eight years, and are coming to terms with the fact that they have lost their investment.

Its directors, who live large and drive posh cars, ride roughshod over investors and have no time even for direct media inquiries, preferring to use police to silence protesters rather than face their customers and offer solutions.

DELIVERABLES

Urithi chairman, Samuel Maina, in the most recent status update, dated June 2, said the co-operative had profiled every project to give clear timelines and deliverables.

“Over 30 land projects are in good progress and their title deeds shall be delivered in a few months. We have set up a robust communication desk to contact each of the members based on their obligations or payment status,” he said.

Mr Maina said those who understand the Urithi socio-economic model, understand that “each project is independently based on its timelines, region or structure”.

“Each should be addressed as such, without mixing issues,” he added. Urithi is accused of collecting money from members to buy land, which it used as collateral for loans. Some of the land is now facing auction.

Potential investors were drawn to the projects by enticing adverts, well-planned trips to view the land, with mega ground breaking ceremonies and artistic impressions of what their future homes would look like.

Some were taken to Malindi more than five years ago, accommodated in a posh hotel and then driven 20 kilometres to be shown the land that they were buying.

Urithi then asked for fencing and title processing money, but after being paid, the sales agents disappeared and blocked customers’ calls.

PAYMENT SCHEDULES

The promise was that they would own the homes within a relatively short time and the payment schedules only sweetened the deal.

So they trooped in their thousands to join the co-operative. Now they are in tears as they realise that they were duped into buying air. Most agents who sold properties on behalf of the co-operative have also vanished.

The clients are now lining up at the Directorate of Criminal Investigations (DCI) to lodge complaints.

For more than two weeks, the Nation has tried to get the company and its agents to talk. Last Friday, Chairman Maina did not pick our calls. But he sent a text message: “Hello, thanks for inquiring. I will call you once I am free to talk.” He has not communicated.

We asked him what had led to the flood of complaints from distressed members, and what had caused the latest problems. 

 Simon Gathai

When Mr Simon Gathai invested Sh1.95 million on land within the Nairobi metropolitan, he knew that was what he wanted. Even though it was covered with coffee bushes, the sales talk that accompanied the artistic impressions of what the estate would look like when completed were enough to convince him to buy it.

“I was told that roads would be constructed, a perimeter wall and common areas for residents,” he told the Nation. He took a bank loan to pay the entire Sh1.95 million for an eighth of an acre plot at Ruiru Ridges in April, 2018.

After paying, Mr Gathai knew it was just a matter of time before he would have land to build his home.

“But ever since, we are still waiting for our titles. They have just been telling us to wait. The whole project seems to be a sham,” offers a disappointed Mr Gathai.

“I have tried approaching the management to be shown my plot so that I can uproot the coffee bushes and develop it but I have not been successful,” he adds.

STATUS MEETINGS

He says the co-operative has been reluctant to call status meetings, fearing members will know each other and mobilise themselves, which would work against its interests.

Meanwhile, Mr Gathai continues to service the loan he took to pay for the land, which pains him.

 Benear Shapaya

In 2016, Mr Benear Shapaya attended a ground-breaking ceremony for the co-operative’s housing projects. He was trying to weigh his options on where to invest, especially in property.

After the sumptuous meal and flowery speeches on how the co-operative would walk with members to see them own their own homes, Mr Shapaya decided to invest in one of their projects.

In August that year, he secured a Sh1 million bank loan, which he used to book a two-bedroom unit in Joska-OTG Phase 2. The property’s full cost was Sh1.6 million.

He was promised that the project would be completed in two years, and so he proceeded to pay monthly instalments. However, as months turned into years, there was nothing to show for his money.

“I don’t even know where the property I bought is. I have tried finding out from Urithi offices but nobody seems to know. It seems I paid money for a project that does not exist,” he says.

When he saw things were not turning out as he expected, in May last year, he wrote to the co-operative, saying he wanted to withdraw his membership and seek reimbursement of the money he paid.

“That was after I made my last payment and went on the ground, only to find there was nothing to show for the money I had paid. I realised we had been duped,” he told the Nation. He had invested Sh1.4 million and had completed servicing the Sh1 million loan.

‘They do not seem to be interested in finishing the project. Whenever they say they are doing something, it’s just some cosmetic kind of thing,” he says.

He now wants his money refunded after realising it was not a genuine deal. 

 Jane Maina

What motivated Jane Maina to join Urithi was the desire to own a home, and the fact that she worked in Mombasa and did not have the time to supervise the construction of a house.  She considered buying a housing the easier option.

In 2016, she joined the co-operative’s OTG-Joska and Juja-Gem projects, where she thought she hoped to own three houses. By the end of 2017, she had completed payments for the OTG project, which cost Sh1.6 million.

During the Annual General Meeting AGM in 2018, Ms Maina says, Urithi Chairman Maina promised members of the project that all the units would be completed by November that year and their houses would be handed to them. That has not happened to date.

Ms Main has paid Urithi Sh4.37 million. She regrets having sold a plot on Thika Road to invest in the project.

 Susan Nyaga

Before Susan Nyaga’s husband died, they decided to acquire a house to avoid paying rent. And she came across the Urithi adverts in late 2016. Since her husband was working in Somalia, she secured a Sh1 million bank loan for the down payment. She would pay the remaining Sh600,000 in instalments.

Unfortunately, she lost her husband in January 2017 when she was still struggling to settle the balance, as well as service the loan.

“At the time, I was under a lot of stress, having lost my husband. But the co-operative kept asking me to complete my payments while the bank was pushing me to service their loan,” she says.

So she took another bank loan to repay the first one and pay Urithi what she still owed.

All the while the co-op promises that the houses would be handed over to the owners by March 2017. But March came and went, without any communication from Urithi.

In April, she visited the site and found out what was happening. It was then that she realised, to her shock, that the house she had been told was almost complete did not even exist.

Meanwhile, the bank from which she had taken the second loan was on her neck. She sold a car and a plot to repay the bank.