Mbaru asks Treasury to issue hospitality bond to save hotels
Monday, June 15, 2020 0:01
By GEOFFREY IRUNGU
Investment banker Jimnah Mbaru.
FILE PHOTO | NMG
The Government should issue an asset-backed infrastructure bond targeting to buy assets of distressed hotels and lease them back to the same establishments.
The arrangement would work such that State would use the money from the “hospitality bond” to buy the assets, but upon completion of the payment of the leases the hotels would revert to owners.
“The Government should issue an infrastructure bond named 'Hospitality Bond' and the funds from the bond would be used to buy and lease back assets of distressed hotels,” said Mr Mbaru, chairman of Dyer Blair Investment Bank.
“On completion of payment of leases the assets would revert to the owners of the hotels, thereby saving them and many jobs.”
