By Anderson Ojwang
Kisumu City Board has witnessed a near collapse of property rent collections by Charcon Properties Limited from Sh20,447,477 in Financial Year 2023/24 to Sh6,183,882 in FY 2024/25.
This represents a sixty-nine point eight per cent (69.8%) reduction in a single financial year, occurring during the period in which Charcon Properties Limited was engaged as managing agent.
“The FY 2024/25 rent collection of Kshs. 6,183,882 represents the lowest recorded rent collection in the five-year period under review, and marks a decline of Kshs. 14,263,595 from the previous financial year — the steepest single-year collapse in any Own Source Revenue stream over the review period. This decline occurred in direct correspondence with Charcon Properties Limited’s engagement as managing agent,” the report read.
The Kisumu County Assembly Ad Hoc Committee was alarmed by the decline to Sh14,263,595 and summoned Managing Director, Mr Connel Osano, to appear personally before the committee for substantive interrogation.
“On the appointed date (7th May 2026), the Company sent Mr Martin Okumu (Head of Operations) and Mr Jairo Nyamwaya (Property Manager) without a letter of authority, which the Committee found unacceptable and recorded it as contemptuous disregard for the County Assembly’s oversight mandate,” the committee wrote.
The committee, in its engagement with the Kisumu City Board, revealed that revenue performance has consistently underperformed against targets over three years despite significant projection increases and despite delegation of revenue collection roles to the City Board; that revenue monitoring was mainly report-based rather than real-time; and that the city currently operates a billing-oriented system rather than a fully integrated revenue management system.
The committee found that Charcon Properties Limited was contracted to supervise rent collection on behalf of the City Board, and “that the County is in the process of procuring a new revenue system which did not appear materially different from the existing one as presented,” the committee wrote.
The committee found that the engagement of Charcon Properties Limited without adequate oversight mechanisms, performance benchmarks, remittance timelines, or contractual accountability provisions directly contributed to this outcome.
The committee further observed that the Kisumu City Board failed in its supervisory responsibility to monitor Charcon’s performance and enforce remittance of collected rents to the County Revenue Fund.
According to the Property Management Progress Report dated 3rd May 2026 and the handover documentation referenced, the following estates, residential blocks, and institutional houses were placed under Charcon Properties Limited’s management:
Residential Blocks — Estates and Housing Units:
- Block 11 (Units 37, 38, 43, 46, 47, 47B, 47C, 47D, 48, 49 and 52)
- Block 4 (Units 149A, 149B, 158A, 158B, 154A and 154B)
- Block 8 (Units 79, 79A, 148A, 148B, 208, 208A, 258A, 258B, 258C, 258D, 258E, 258F, 259A, 259B, 259C and 259D)
- Block 10 (Units A, B, C and D)
- Block 12 (Units 91A, 91B and 91C)
Slaughter Houses:
- Slaughter House A, Slaughter House B and Slaughter House C; and Kibuye Estate (approximately 45 units)
Institutional and Special Facilities:
- Ober Kamoth Health Centre
- Got Nyabondo Health Centre
- Mama Ngina Children’s Home
- Old Fire Station
On New Leases and Renewals:
The report records that lease renewals have been materially impeded by the non-availability of updated Finance Act rental rates. The report states: “Renewal of Tenancy Agreements and leases is further dependent on the new County Finance Act, which prescribes the updated rent rates to be applied. This document has not been availed to us, making it impossible to commence the latest round of lease renewals.”
On Maintenance:
The report identifies extensive maintenance deficiencies including: plumbing, electrical and structural repairs required urgently at Kibuye Estate; leaking roofs at Block 12-A and Block 12-B (requiring complete overhaul); non-operational plumbing at House 11/49; and the Ober Kamoth Health Centre units being described as uninhabitable due to absence of water and leaking conditions, rendering rent enforcement impossible until conditions are addressed.
On Occupancy:
Occupancy levels across estates remain high, with most units occupied despite ongoing disputes and maintenance challenges. Several units are non-revenue generating due to occupation by county departments, security personnel, and institutional users. Some units remain unoccupied due to dilapidated conditions, pending repairs, or unresolved ownership claims. A comprehensive physical verification exercise is stated to be ongoing.
On Non-Revenue Generating Units:
The report identified multiple units that were non-revenue generating, including: Houses 4/149, 4/149A and 4/149B — occupied by KIWASCO, whose headquarters were constructed on these sites; Houses 8/148 and 8/148A — occupied by the Governor’s security detail; Houses 8/208A and 8/208B — used by the County First Lady as offices; and Houses 8/258A through 8/259D — found to belong to NSSF and since demolished for modern housing construction. These units generate no rental income to the county.
On Senior County Employees in Default:
The report explicitly states that a significant number of county government employees in higher ranks, including County Executive Committee Members, have been unwilling to pay rent; that despite repeated follow-ups, many either ignore communication or remain non-responsive to official correspondence; and that this creates substantial challenges in enforcing tenancy obligations. Some tenants making payments through payroll check-off deductions continue to show arrears in their accounts, indicating gaps in remittance reconciliation between the payroll office and the rent accounts.
Findings
The committee found that the Property Management Progress Report dated 3rd May 2026 confirmed that Charcon Properties Limited was, throughout the reporting period, unable to enforce rent collection against a significant proportion of tenants, including senior county government employees and elected officials — and that this failure was compounded by unresolved ownership disputes, the non-availability of updated Finance Act rates, inadequate maintenance of managed properties, and a structural reconciliation deficit between Charcon’s accounts and the Revenue Board’s collection records.
The committee further finds that Charcon’s letter dated 20th November 2025 to Mr David Nandi requesting rent payment slips for September and October 2025 is direct evidence that the managing agent did not have a complete and current picture of rent collected and remitted to the county — a fundamental failure of agency accountability.
The committee found that property rent revenue collapsed by sixty-nine point eight per cent (69.8%) in FY 2024/25, representing a loss of Kshs 14,263,595 against the prior year’s collections. This collapse occurred during the period of Charcon Properties Limited’s engagement as managing agent.
As at April 2026, cumulative rent arrears across the managed portfolio stand at approximately Kshs 7,810,660, with a cumulative collection rate of approximately fifteen per cent (15%) over the fourteen-month reporting period.
